US says $400m to Iran not a ransom

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Obama administration denies $400 million Iran cash payment was a ransom.

WASHINGTON  - The Obama administration said on Wednesday that $400 million in cash paid to Iran soon after the release of five Americans detained by Tehran was not ransom as some Republicans have charged.

The five, including Washington Post reporter Jason Rezaian, were released on January 16 in exchange for seven Iranians held in the United States for sanctions violations. The prisoner deal coincided with the lifting of international sanctions against Tehran.

At the time, the United States said it had settled a longstanding Iranian claim at the Iran-US Claims Tribunal in The Hague, releasing $400 million in funds frozen since 1981, plus $1.3 billion(R18.17 billion) in interest that was owed to Iran.

The funds were part of a trust fund Iran used before its 1979 Islamic Revolution to buy US military equipment that was tied up for decades in litigation at the tribunal.

Representative Jason Chaffetz, the chairman of the House of Representatives Oversight Committee, on Wednesday sent a letter to US Secretary of State John Kerry asking him to appear at a future committee hearing to discuss the payment.

White House spokesperson Josh Earnest rejected suggestions the money transfer to Iran was ransom or a secret.

"The United States, under President Obama, has not paid a ransom to secure the release of Americans unjustly detained in Iran and we&39;re not going to pay a ransom," he said in response to a Wall Street Journal article that said Washington secretly organized the cash airlift.

Earnest said Republicans, who have long opposed the Iran nuclear deal, are seizing on how the money was paid to Iran as a way to undermine the deal. "They&39;re struggling to justify their opposition to our engagement with Iran," he told a briefing.

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&39;s decision.

Due to international sanctions against Iran, the payment, made in euros, Swiss francs and other currencies, had to be made in cash, US officials argue.

One US official said the $1.3 billion in interest was paid to Iran through the US Treasury-administered Judgment Fund, which is used to pay awards against the United States.

Senior officials at the Justice Department had objected to sending cash on a plane to Iran at the same time that Iran was releasing four imprisoned Americans but were overruled by the State Department, the Wall Street Journal reported in a separate story on Wednesday, citing people familiar with the discussions.

"People knew what it was going to look like, and there was concern the Iranians probably did consider it a ransom payment," the newspaper quoted one of the people as saying.

"The Department of Justice fully supported the ultimate outcome of the Administration&39;s resolution of several issues with Iran, including Hague settlement efforts, as well as the return of US citizens detained in Iran. We will not comment further on internal interagency deliberations," a department spokesperson said in a statement.

Republican presidential nominee Donald Trump blamed his opponent, former Secretary of State Hillary Clinton, for launching the talks with Iran.

"Our incompetent Secretary of State, Hillary Clinton, was the one who started talks to give 400 million dollars, in cash, to Iran. Scandal!" Trump said in a Twitter post.

Republican National Committee spokesman Reince Priebus also weighed in, saying: "The Obama-Clinton foreign policy not only means cutting a dangerous nuclear deal with the world&39;s number one state sponsor of terrorism, it also means paying them a secret ransom with cargo planes full of cash."

House Speaker Paul Ryan was more measured, saying that: "If true, this report confirms our longstanding suspicion that the administration paid a ransom in exchange for Americans unjustly detained in Iran."