The United States paid Iran $1.7 billion in cash earlier this year, most of which was taxpayer money, around the same time that the Islamic Republic released several American prisoners, as first reported by the Associated Press.
Administration officials have rejected charges that the payment was for ransom, and have said that the money, of which $400 million was an initial payment and $1.3 billion was accrued interest, represents a settlement for a decades-old arms deal gone awry.
Treasury Department spokesperson Dawn Selak told THE WEEKLY STANDARD Tuesday that successful sanctions on Iran forced the United States to pay the sum in cash.
“The form of those principal and interest payments – made in non-U.S. currency, in cash – was necessitated by the effectiveness of U.S. and international sanctions regimes over the last several years in isolating Iran from the international financial system,” Selak said in a statement.
White House and State Department officials have for weeks refused to disclose details about the payment, including its method and timing. On Tuesday, State, Treasury, and Justice Department officials informed congressional staff that the remaining $1.3 billion was also paid in cash installments, on January 22 and February 5, the AP reported.
The congressional briefing, which was meant to “provide a full and complete accounting of the Hague Tribunal settlement,” had been “offered several times in the past,” Treasury said.
The $1.3 billion came out of the Judgment Fund, which is fueled by taxpayer dollars, run by the Treasury Department, and “used to pay for certain court judgments and settlements against the federal government.” The fund allows the president to skirt direct congressional approval to exercise the power of the purse.
The administration has denied that the payment was quid pro quo, but has said that the cash was “leverage,” held until Iran released the hostages. Officials have also said that Iran has “so far” not used the money “for any nefarious activities.”
The payment has nevertheless been met with a flurry of legislation.
Florida senator Marco Rubio and Kansas congressman Mike Pompeo introduced legislation this week that will prohibit the government from paying ransom, as well as block Judgment Fund money from being sent to state sponsors of terrorism without congressional approval, among other provisions.
“Congress is taking a clear stand—demanding Iran return the more than $1 billion the Obama Administration wrongly gave them and putting a stop to any and all future money this administration, or any administration might want to give to state sponsors of terrorism like Iran,” Pompeo said in a statement last week.
Chairman of the House foreign affairs committee Ed Royce has also introduced a bill that “prohibits cash payments to Iran—period” and “demands transparency on future settlements to ensure they are not used to pay ransom.”
