Right-wing media are distorting a new report in The Wall Street Journal detailing a payment of $400 million from the United States government to the Iranian government to resolve an arms sale dispute dating to 1981. Conservative outlets are suggesting the payment “was definitely ransom” paid for American prisoners held in Iran, claiming “the administration did not reveal this to the public,” suggesting that Hillary Clinton was wrong to say the report is “old news,” and that airlifting cash to make the payment was essentially “money laundering.” But past reporting and explanations from the administration reveal “no concrete evidence that the cash payment was, in fact, a ransom,” that many of the details of the payments were made public in January, Clinton correctly noted the payment has been public for “seven or eight months,” and making the payment in cash was the only way to legally do it due to economic sanctions against Iran.
Resolution Of 35-Year-Old Dispute Coincided With Iran Nuclear Agreement And Prisoner Exchange
Wash. Post: Nuclear Agreement Between U.S. And Iran “Helped Accelerate The Talks” About Freeing Prisoners. On January 16, after years of negotiations, the United States government secured the release of five Americans held prisoner in Iran, including Washington Post reporter Jason Rezaian, who had been held in captivity for nearly two years. Their release was secured on the same day that the two nations agreed to an historic nuclear nonproliferation agreement, which President Obama heralded as “smart, patient and disciplined” diplomacy. According to the Obama administration, the prisoner release was “negotiated separately” from the nuclear accord “to ensure that the detainees were not used as leverage,” but the administration did concede that fruitful nuclear negotiations “helped accelerate the talks.” From a January 17 Washington Post article:
The nuclear agreement and the release of the American prisoners were negotiated separately to ensure that the detainees were not used as leverage, U.S. officials said. But the completion of the nuclear deal last summer helped accelerate the talks about the prisoners, which loomed in the background of the negotiations.
The Americans were freed in exchange for U.S. clemency in the cases of seven Iranians charged or imprisoned over sanctions violations, and the dismissal of outstanding charges against 14 Iranians outside the United States. At least five of the Iranians granted pardons or sentence commutations intend to stay in the United States, their attorneys said. [The Washington Post, 1/17/16]
AFP: U.S. Agreed To Repay $400 Million Plus Interest To Iranian Government Over Disputed Arms Sale. On January 17, the United States government agreed to repay $400 million plus approximately $1.3 billion in accumulated interest to the Iranian government to resolve a disputed arms sale between the two nations that occurred “prior to the break in diplomatic ties” during the 1979 Iranian revolution. According to reporting from Agence France-Presse (AFP) and other news agencies, the payment resolved a deadlock at the Iran-U.S. Claims Tribunal that had stood since the tribunal’s inception in 1981, and represented “a broader clearing of the decks between the old foes” just one day after the signing of an historic nuclear agreement. AFP reported at the time that the Obama administration’s political opponents were already attempting to scandalize the arrangement:
The repayment, which settles a suit brought under an international legal tribunal, is separate from the tens of billions of dollars in frozen foreign accounts that Iran can now access after the end of nuclear sanctions.
But the timing of the announcement, one day after the implementation of the Iran nuclear accord, will be seen as pointing to a broader clearing of the decks between the old foes.
US President Barack Obama defended the settlement in a televised statement from the White House, saying it was for “much less than the amount Iran sought.”
[Secretary of State John] Kerry described Sunday's payment of the 35-year-old trust as a “fair settlement.” But the debt deal immediately drew the ire of those in Washington who think the Obama administration had already made too many concessions to secure the nuclear deal. [Agence France-Press, 1/17/16]
The Wall Street Journal Reports U.S. “Secretly Organized” Cash Transfer To Iran
WSJ: U.S. “Secretly Organized An Airlift Of $400 Million Worth Of Cash To Iran.” On August 3, The Wall Street Journal reported that the United States “secretly organized an airlift of $400 million worth of cash to Iran that coincided with the January release of four Americans detained in Tehran.” The Journal noted that “[t]he money represented the first installment of a $1.7 billion settlement the Obama administration reached with Iran to resolve a decades-old dispute over a failed arms deal signed just before the 1979 fall of Iran’s last monarch,” adding that “senior U.S. officials denied any link between the payment” and a prisoner exchange that resulted in five Americans being freed. From the August 3 article:
The Obama administration secretly organized an airlift of $400 million worth of cash to Iran that coincided with the January release of four Americans detained in Tehran, according to U.S. and European officials and congressional staff briefed on the operation afterward.
Wooden pallets stacked with euros, Swiss francs and other currencies were flown into Iran on an unmarked cargo plane, according to these officials. The U.S. procured the money from the central banks of the Netherlands and Switzerland, they said.
The money represented the first installment of a $1.7 billion settlement the Obama administration reached with Iran to resolve a decades-old dispute over a failed arms deal signed just before the 1979 fall of Iran’s last monarch, Shah Mohammad Reza Pahlavi.
Senior U.S. officials denied any link between the payment and the prisoner exchange. They say the way the various strands came together simultaneously was coincidental, not the result of any quid pro quo.
Meanwhile, U.S. officials have said they were certain Washington was going to lose the arbitration in The Hague, where Iran was seeking more than $10 billion, and described the settlement as a bargain for taxpayers.
The $400 million was paid in foreign currency because any transaction with Iran in U.S. dollars is illegal under U.S. law. Sanctions also complicate Tehran’s access to global banks.
The Iranians were demanding the return of $400 million the Shah’s regime deposited into a Pentagon trust fund in 1979 to purchase U.S. fighter jets, U.S. officials said. They also wanted billions of dollars as interest accrued since then. [The Wall Street Journal, 8/3/16]
Right-Wing Media Distort WSJ Report To Renew Attacks On Iran Negotiations
Fox’s John Bolton: “Of Course It’s Ransom. I Don’t Think There’s Any Way Of Getting Around It.” Reacting to the Journal article, Fox News contributor John Bolton said “of course” the payment to Iran was “ransom,” adding, “I don’t think there’s any way of getting around it.” From the August 4 edition of Fox News’ America’s Newsroom:
JOHN BOLTON: Well, of course, it's ransom. I don't think there's any way of getting around it. It's not a question what the administration says it is or what Iran says it is, it's the reality that the money paid was -- got -- helped get the hostages released as part of the overall nuclear deal. But I think there may have been other questions that [the] Justice [Department] was asking here, because the way this transaction was handled, without more information, it looks to me to be in serious jeopardy of violating the prohibitions on using dollars for transactions with Iran.
I don't think it should make any difference whether some government agency converted U.S. dollars into Swiss francs or euros. You could give the Iranians $400 million worth of pizzas, it would be exactly the same thing. It would be a transmission of resources to them. So I think -- I encourage all those investigative reporters at The Washington Post and The New York Times to get the scoop on what else Justice said. And importantly, who overruled them. I don't think the State Department could overrule the Justice Department on its own. [Fox News, America's Newsroom, 8/4/16]
Fox’s Ralph Peters: “This Was Definitely A Ransom, Or A Bribe If You Prefer To Call It That.” Fox News strategic analyst Ralph Peters stated that the payment “was definitely ransom” and that “the rest of the world” would look at the arrangement and conclude “we did pay ransom.” From the August 3 edition of Fox News’ America’s Newsroom:
RALPH PETERS: This was definitely a ransom, or a bribe if you’d prefer to call it that. And I can even tell you how it happened. It's the same thing as when you walk into a car dealership and you haggle with the car dealer. And finally you think the salesman -- you've agreed on a price, and the salesman disappears into the back room, and you're excited about that car, and the contract comes out, and it's $800 higher than you agreed on. And he says, “oh, that's a dealer prep charge.” And, if you're a fool, as John Kerry was of the Iranians, you agree to the higher charge. It was clearly a sweetener to get the deal through and to get the Iranian-Americans released. And the problem is, Elizabeth, that we did pay ransom. That's how it looks to the rest of the world. [Fox News, America's Newsroom, 8/3/16]
FACT: “No Concrete Evidence” That Payment Was A Ransom
AP: “There Is No Concrete Evidence That The Cash Payment Was, In Fact, A Ransom.” According to an Associated Press (AP) fact-check of Republican presidential nominee Donald Trump’s reaction to the WSJ article, “There is no concrete evidence that the cash payment was, in fact, a ransom.” The AP reported that “The Obama administration has flatly denied it has ever paid ransoms, including in this case,” and “officials acknowledge that progress in the nuclear negotiations contributed to progress on the settlement of the claim as well as progress in talks on the release of the Americans.” From the August 3 fact-check:
THE FACTS: There is no concrete evidence that the cash payment was, in fact, a ransom.
Critics of the Iran deal, including many senior Republican lawmakers, maintain that the $400 million settlement was a ransom for the release of four private American citizens jailed in Tehran and freed a day after the Iran deal was implemented. Some Iranian officials have suggested the same thing. The Obama administration has flatly denied it has ever paid ransoms, including in this case.
The timing of the prisoner release and the arrival of the payment has given weight to GOP claims. U.S. officials acknowledge that progress in the nuclear negotiations contributed to progress on the settlement of the claim as well as progress in talks on the release of the Americans. [Associated Press, 8/3/16]
Vox: $400 Million “Wasn’t A Ransom Payment,” Trump Is Wrong To Characterize It That Way. An August 3 Vox post explaining the controversy over the payment stated “it wasn’t a ransom payment. It was a settlement.” The post further explained that Trump “is wrong” to go with the “‘secret ransom payment’ line.” [Vox, 8/3/16]
CNN: Prisoner Release Was Part Of A “Separate [Negotiating] Session” That “Opened After The Iranian Nuclear Deal.” In January, CNN.com reported that the United States “insisted there had to be a separate session between the U.S. and Iran” to discuss the “prisoner exchange.” According to CNN.com, “A senior administration official who briefed reporters said a ‘window’ opened after the Iranian nuclear deal ‘and we wanted to take advantage of that window.’” From the January 16 report:
The prisoner exchange between the U.S. and Iran capped 14 months of secret diplomacy and talks between Washington and Tehran as the U.S. and world powers negotiated the pact to curb Iran's nuclear program, reflecting a thaw in relations between the sworn enemies.
The negotiation over the prisoners began on the sideline of the nuclear talks, intensified after the deal was completed last April and heated up even further in recent months, senior administration officials told CNN. The secret talks were led by Brett McGurk, the U.S. special envoy tapped by President Barack Obama to coordinate the global fight against ISIS, the officials said
The Iranians told the U.S. during the talks they wanted a “goodwill gesture” and gave the U.S. a list of Iranians they wanted released. The U.S. officials excluded any names of anyone charged with terrorism or violence, insisting that they would only consider those who had been convicted of sanctions violations or violations of the trade embargo.
After every meeting on the nuclear deal between world powers and Iran, the U.S. insisted there had to be a separate session between the U.S. and Iran on the American prisoners, the officials said. [CNN.com, 1/16/16]
State Department: “Any Suggestion That It Had Anything To Do With Ransom Is Absolutely And Utterly False.” In an interview on Fox News, State Department spokesman John Kirby explained that the prisoner exchange was negotiated by “a completely separate team than was working in The Hague tribunal to negotiate this claim.” After co-host Bill Hemmer said the payment “looks like it’s ransom,” Kirby reiterated the U.S. government’s policy that “We don't pay ransom. We just don't pay ransom. It is our policy. This was not ransom.” From the August 3 edition of Fox News’ America’s Newsroom:
JOHN KIRBY: The teams that were negotiating the release of our Americans was a completely separate team than was working in The Hague tribunal to negotiate this claim. Completely separate processes, though simultaneously done. The timing is all coincidental. Again, we can --
BILL HEMMER (HOST): This is from The Wall Street Journal report, this is very important now, OK? Because, in its story today, it talks about Iranian press reports. And, straight out of Tehran, they've quoted senior Iranian defense officials saying, “it was a ransom payment.” Now, are they wrong?
JOHN KIRBY: Yes, they are. They're absolutely wrong, Bill. Completely wrong. Look, you can believe us, who've talked about this on camera and on the record since January, or you can believe an unnamed, anonymous defense official from Iran. You choose who you are going to believe to be more credible.
HEMMER: Well, 1.3 billion to go, correct?So, that means what, is that more pallets of euros headed for Tehran?
HEMMER: And, you know, the series [of] events last January, it looks like it's ransom. It looks like Tehran said, “we'll go ahead and do this, but you have to give us the money, and you have to do it in cash.”
KIRBY: We don't pay ransom. We just don't pay ransom. It is our policy. This was not ransom. Any suggestion that it had anything to do with ransom is absolutely and utterly false. These were two separate processes run by two separate teams. Now, yes, they were done simultaneously, and so I understand the coincidental nature here of the timing. But, absolutely had nothing to do with ransom. We do not, and will not, pay ransom. [Fox News, America's Newsroom, 8/3/16]
Fox’s Steve Doocy: “We Didn’t Know About This.” Fox & Friends co-host Steve Doocy hyped The Wall Street Journal’ article, saying of the $400 million cash payment was “ransom money” and that the American public “didn’t know about this.” Co-host Anna Kooiman also cited Trump’s misleading tweet about the article, which blamed Hillary Clinton for the so-called “scandal.” From the August 3 edition of Fox News’ Fox & Friends:
STEVE DOOCY (CO-HOST): All right, The Wall Street Journal had an exclusive report yesterday late in the day and now everybody's got it. The same day that four American hostages were released by the country of Iran, earlier that day, under the cover of darkness we believe, the United States sent an unmarked cargo jet. There you've got the hostages landing in Geneva. They've been loaded up in Tehran. Earlier, an unmarked white cargo plane with $400 million on wooden pallets in Swiss francs was delivered to the country of Iran, and right now, people are saying, “wait, that’s hostage money, right? That’s ransom money.” No, the administration says it's not. It might look like it, but indeed what that was was part of $1.7 billion we owed to the country of Iran after that 1979 arms deal and the fall of the Shah of Iran.
ANNA KOOIMAN (CO-HOST): Yeah, they say that it's -- that the settlement actually is resolving a decades-old dispute. But others others are going, “this looks a whole lot like ransom money.”
DOOCY: Do you think?
KOOIMAN: And Donald Trump tweeted this earlier, and he has reason behind it. He says, “Our incompetent Secretary of State, Hillary Clinton, was the one who started talks to give 400 million dollars, in cash, to Iran. Scandal!”
DOOCY: So you’ve got four Americans released who had been held hostage, and then there's $400 million in that airplane. Remember the American sailors who were taken hostage and, of course, we were told that no money was paid regarding that. But we didn't know about this, what apparently was ransom money either. You got to wonder whether or not there was a secret deal regarding that, too. [Fox News, Fox & Friends, 8/3/16]
Fox’s Tucker Carlson: “The Truth Remains That The Administration Did Not Reveal This To The Public.” Fox host Tucker Carlson stated that the payment “was ransom,” and that “the administration did not reveal this to the public.” While Carlson insisted that “any reasonable person looking at this is going to reach that conclusion,” he admitted that the claim is “[h]ard to prove” and “[m]aybe it’ll never be proved.” From the August 3 edition of Fox News’ America’s Newsroom:
BILL HEMMER (CO-HOST): What do you make now with the administration pushing back, suggesting that John Kerry made this public months ago? Yet there does not appear to be a record of Kerry talking about money.
TUCKER CARLSON: No, there doesn't, and of course the administration has talked about this deal in some great detail a lot over the last several months, and never mentioned this. It was done secretly in an unmarked aircraft, as you know. Not in U.S. dollars, in euros and francs. Pallets of them. And it was done that way because it would have been illegal to conduct it in U.S. dollars, which tells you everything right there. If you and I did this in American currency, we'd be charged with a felony. And so, there is a secretive component to this. Why would the administration keep this from the American people? It seems to me that’s a pretty obvious question for Admiral Kirby. But it has an odor to it.
This component of the deal was known that Iran was expecting payment of frozen funds, et cetera, et cetera. But the truth remains that the administration did not reveal this to the public, and that American hostages were released at the same time, and it's impossible not to draw the conclusion that this was, at least in part, ransom money. And boy, that's of a piece, by the way. For all the talk about how we never pay for ransom for hostages, we don't negotiate, the truth is that news organizations and governments very often pay ransom and negotiate, and everyone in Washington, for example, knows that. And the lying and the sanctimony around this subject is hard to take once you know that. [Fox News, America’s Newsroom, 8/3/16]
Rush Limbaugh: “Obama Secretly Paid $400 Million To The Iranians For The Release Of Four American-Iranian Hostages.” Rush Limbaugh asserted that “Barack Hussein Obama secretly paid $400 million to the Iranians for the release of four Iranian American hostages.” From the August 3 edition of Premiere Radio Networks’ The Rush Limbaugh Show:
RUSH LIMBAUGH (HOST): We were talking about Barack Hussein Obama’s excoriating Donald Trump for being “unfit” for office. For being unsuitable. Or maybe even being mentally unfit to hold the office of president of the United States. What have we learned since yesterday? We have learned that Barack Hussein Obama secretly paid $400 million to the Iranians for the release of four American-Iranian hostages. [Premiere Radio Networks, The Rush Limbaugh Show, 8/3/16]
FACT: Most Details Of The WSJ Article Were Announced By The Obama Administration In January
President Obama In January: “The United States And Iran Are Now Settling A Longstanding Iranian Government Claim Against The United States Government.” In a January 17 statement on the implementation of the Iran nuclear deal, President Obama explained that “engaging directly with the Iranian government on a sustained basis … has created a unique opportunity -- a window -- to try to resolve important issues.” Among those issues, Obama said, was the resolution of a “financial dispute that dated back more than three decades”:
So, nuclear deal implemented. American families reunited. The third piece of this work that we got done this weekend involved the United States and Iran resolving a financial dispute that dated back more than three decades. Since 1981, after our nations severed diplomatic relations, we’ve worked through a international tribunal to resolve various claims between our countries. The United States and Iran are now settling a longstanding Iranian government claim against the United States government. Iran will be returned its own funds, including appropriate interest, but much less than the amount Iran sought.
For the United States, this settlement could save us billions of dollars that could have been pursued by Iran. So there was no benefit to the United States in dragging this out. With the nuclear deal done, prisoners released, the time was right to resolve this dispute as well. [The Washington Post, 1/17/16]
Secretary Of State John Kerry Issued Press Release Announcing Settlement Of Iranian Government’s Claims, Beginning With $400 Million Payment. On January 17, Secretary of State John Kerry issued a press release explaining that Iran will be paid $400 million, to be followed by $1.3 billion more to settle “a long outstanding claim at the Iran-U.S. Claims Tribunal in the Hague”:
The United States and Iran today have settled a long outstanding claim at the Iran-U.S. Claims Tribunal in the Hague.
This specific claim was in the amount of a $400 million Trust Fund used by Iran to purchase military equipment from the United States prior to the break in diplomatic ties. In 1981, with the reaching of the Algiers Accords and the creation of the Iran-U.S. Claims Tribunal, Iran filed a claim for these funds, tying them up in litigation at the Tribunal.
This is the latest of a series of important settlements reached over the past 35 years at the Hague Tribunal. In constructive bilateral discussions, we arrived at a fair settlement to this claim, which due to litigation risk, remains in the best interests of the United States.
Iran will receive the balance of $400 million in the Trust Fund, as well as a roughly $1.3 billion compromise on the interest. Iran’s recovery was fixed at a reasonable rate of interest and therefore Iran is unable to pursue a bigger Tribunal award against us, preventing U.S. taxpayers from being obligated to a larger amount of money. [U.S. Department of State, 1/17/16]
NY Times: $400 Million Transfer Was “For Military Equipment … Sold To The Shah Of Iran And Never Delivered When He Was Overthrown.” The New York Times reported on January 17 that the president announced the return of “over $400 million in payments for military equipment that the United States sold to the shah of Iran and never delivered when he was overthrown”:
Mr. Obama also announced the resolution of another argument between Tehran and Washington that dates to the Iranian revolution, this one over $400 million in payments for military equipment that the United States sold to the shah of Iran and never delivered when he was overthrown. The Iranians got their money back, with $1.3 billion in interest that had accumulated over 37 years. [The New York Times, 1/17/16]
Hillary Clinton Responds To Questions About WSJ Article: “Actually This Is Kind Of Old News. It Was First Reported About Seven Or Eight Months Ago, As I Recall.” In an interview with Denver-based NBC affiliate 9 News, Hillary Clinton was asked if she “knew” the payment to Iran “was coming” and whether she “approve[d] of it,” to which Clinton responded by saying “I think actually this is kind of old news. It was first reported about seven or eight months ago, as I recall.” Clinton added that the payment “had nothing to do with any kind of hostage swap or any other tit for tat. It was something that was intended to, as I am told, pay back Iran for contracts that were canceled when the Shah fell.” [KUSA, 9News.com, 8/3/16]
Fox & Friends Hosts Object To Clinton’s Response To WSJ Report. Fox & Friends co-host Anna Kooiman took issue with Democratic presidential nominee Hillary Clinton’s reaction to the Journal’s report. From the August 4 edition of Fox News’ Fox & Friends:
BRIAN KILMEADE (CO-HOST): If you think the tone and tenor of that explanation from Hillary Clinton kind of saying, “where does that come” from sounds familiar, it's exactly what -- it sounds familiar [sic]. It's about Benghazi, it's about when she talks about her emails. She said, “where does this come from? I don’t know where you” -- it makes you feel ridiculous for asking the question.
ANNA KOOIMAN (CO-HOST): Yeah, nothing to see here. Nothing to see here. But those are two stories that she hasn't been able to shake either. [Fox News, Fox & Friends, 8/4/16]
Laura Ingraham: “When She’s Asked A Question About An Uncomfortable Topic” Clinton “Always Kind Of Has The Same Answer” That “It’s Always Old News.” Radio host Laura Ingraham said Clinton “always kind of has the same answer” when responding to “a question about an uncomfortable topic,” saying Clinton’s response is to say “it’s always old news.” From the August 4 edition of Courtside Entertainment Group’s The Laura Ingraham Show:
LAURA INGRAHAM (HOST): [Hillary Clinton] was instrumental in initiating the talks that led to the Iran deal, and was supportive of the Iran deal, we have to remember that. But as far as the actual pallets moving on the cargo plane and being dropped off in Iran, she was already out of office by then. But do you know what? When she's asked a question about an uncomfortable topic, I get a sense she always kind of has the same answer.
HILLARY CLINTON: This is kind of old news.
INGRAHAM: Oh. It's always old news. It just broke yesterday in The Wall Street Journal, it's old news. [Courtside Entertainment Group, The Laura Ingraham Show, 8/4/16]
FACT: Clinton Was Correct: Media Outlets Including Fox News And WSJ Reported On Payment To Iran In January
Fox News On January 18: “The United States Has To Repay Iran A $400 Million Debt … Dating Back To The Islamic Revolution.” On January 18, Fox News correspondent Kevin Corke reported that along with the prisoner exchange and the nuclear deal with Iran, “the United States has to repay Iran a $400 million debt and $1.3 billion in interest dating back to the Islamic revolution.” Corke further explained, “[t]hat $400 million was actually set aside in a trust that Iranians hoped to use to buy U.S. military equipment back in 1979. But, of course, after the break down of diplomatic ties that money was held up so the U.S. has to give back that money; plus as I pointed out in the piece -- $1.3 billion on top of it.” [Fox News, Special Report with Bret Baier, 1/18/16, via Nexis]
WSJ Reported On The Payment On January 21. The Wall Street Journal reported on January 21 that a “$1.7 billion financial settlement ended a 35-year legal saga that centered on a purchase of U.S. arms by Iran’s last monarch, Shah Mohammad Reza Pahlavi, that were never delivered because of the Iranian revolution in 1979.” [The Wall Street Journal, 1/21/16]
Fox’s Charles Krauthammer: “This Is Called Money Laundering.” Despite acknowledging that “there is a statute that prohibits” the United States “from engaging in Iran dealing with dollars,” Fox News contributor Charles Krauthammer still falsely claimed that the $400 million cash transfer, is “money laundering.” From the August 8 edition of Fox News’ Special Report with Bret Baier:
CHARLES KRAUTHAMMER: Well of course the Justice Department objected. It was illegal. It isn't only the optics. It isn't only that they are just looking ridiculous in denying that it was a quid pro quo. Obviously it wasn't a coincidence. The reason that it was objected to by Justice, there is a statute that prohibits us from engaging in Iran dealing with dollars. So they had to -- they had to print the money here, ship it over to Switzerland, turn it into Swiss francs and euros, and ship it over to Iran. If a private company had done this, this is called money laundering, the CEO would be in jail right now. [Fox News, Special Report with Bret Baier, 8/3/16]
Wash. Post’s Jennifer Rubin Alleges “Shady” Payment “Launder[ed] The Money Through European Central Banks.” Conservative Washington Post blogger Jennifer Rubin cited “foreign policy gurus” who described the “shady” payment as “bulk cash smuggling” and “laundering the money” through Europe. From an August 3 post on Rubin’s Right Turn blog:
[A] number of foreign policy gurus have remarked on how shady the arrangement was. Michael Makovsky, CEO of JINSA, observes that “the president has gone rather rogue by circumventing sanctions restrictions on banks by laundering the money through European central banks, which is not only wrong but sends a dangerous signal to other countries and companies.” He further notes, “This payment coincided with not just the release of civilian hostages from Iran but also followed by a few days the release of American sailors who were abducted the prior week.”
Experts emphasize just how peculiar this arrangement was. “The White House sent pallets of cash in an unmarked plane to pay off a state sponsor of terrorism. This is what we call ‘bulk cash smuggling’ in the terrorism finance business,” Jonathan Schanzer of the Foundation for Defense of Democracies remarks. “Until recently, this kind of activity could result in punitive sanctions. Now, the Obama administration is trying to tell us that this is statecraft.” [The Washington Post, 8/3/16]
FACT: “Due To International Sanctions Against Iran, The Payment, Made In Euros, Swiss Francs And Other Currencies, Had To Be Made In Cash”
Reuters: “Due To International Sanctions Against Iran, The Payment … Had To be Made In Cash.” According to an August 4 report by Reuters, which detailed the Obama administration’s responses to claims that the cash settlement sent to Iran was a “ransom” payment, “international sanctions against Iran meant that the settlement had to be paid “in cash”:
While there have long been questions about the timing of the payment, one Iranian concern was that the Obama administration could face too much domestic political criticism if it delayed acting on the tribunal's decision.
Due to international sanctions against Iran, the payment, made in euros, Swiss francs and other currencies, had to be made in cash, U.S. officials argue. [Reuters, 8/4/16]
CNN: Payment Could Not Be Made In American Dollars Because Of U.S. Sanctions. A CNN.com report explained that the payment to Iran had to be made in foreign currency because “existing US sanctions ban American dollars from being used in a transaction with Iran.” [CNN.com, 8/4/16]
The Atlantic’s Steve Clemons Explains That America Doesn’t Have Banking Relationships With Iran, “So The Cash Payment Makes Total Sense.” MSNBC contributor and The Atlantic editor-at-large Steve Clemons explained that because of international sanctions, the United States “just simply [does not] have financial arrangements with Iranian financial institutions” to facilitate money transfers between the two governments, “so the cash payment makes total sense.” From the August 3 edition of MSNBC Live:
STEVE KORNACKI (HOST): What about the cash payment here? This is not money being wired in a traditional sense. This is cash being delivered, has sort of a covert feel to it. What's the purpose of that?
STEVE CLEMONS: Well, I suppose if we had banking relationships with Iran, we could wire money to them. We don't. We have sanctioned Iran, we’ve sanctioned banking institutions that dealing with Iran. After the very big pallets of cash that we have sent to Iraq, we seem to be good at delivering pallets of cash.
One, it wasn't secret, but two, we just simply don't have financial arrangements with Iranian financial institutions any longer. So the cash payment makes total sense. [MSNBC, MSNBC Live, 8/3/16]