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September 23, 2016 9:17 am

Senate Committee Holds Hearing on Obama’s $1.7 Billion Cash Transfer to Iran

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President Obama with Secretary of State Kerry. Photo: White House.

President Obama with Secretary of State Kerry. Photo: White House. – The Obama administration’s $1.7 billion cash payment to Iran earlier this year came under fire during a hearing by the Senate Banking Subcommittee on National Security and International Trade and Finance on Wednesday.

Several experts testified on international banking and terrorism, including former Undersecretary of Defense for policy Eric Edelman, former Attorney General Michael B. Mukasey and Suzanne Maloney, an Iran expert at the Brookings Institution.

“In far too many respects, this incident embodies the deeper failures of the administration’s Iran policy. … Indeed, years of unenforced red lines by the Obama administration – including the one on ransoms – have created a disturbing asymmetry in US-Iran relations, where both countries behave as though the United States is too invested in the JCPOA to risk angering Iran,” Edelman said in his testimony.

In early August, it was revealed the Obama administration had secretly flown $400 million in pallets of cash to Iran, just as four American hostages were released from Tehran in January 2016. The payment also coincided with the implementation of the Joint Comprehensive Plan of Action (JCPOA), or Iran nuclear deal, which saw a number of international sanctions on the Islamic Republic being lifted. An additional $1.3 billion in interest was paid in cash over the following weeks.

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The total $1.7 billion was part of a settlement deal with Iran over a failed arms deal in 1979. The Obama administration, while acknowledging the payment, has continued to deny the money transfer amounts to ransom. Obama has insisted they had to pay with cash, converted to foreign currency, since there is no ability to wire transfer money to Iran, which was not true, according to an expert from the Foundation for Defense of Democracies.

Critics of the payment contend that the cash payment is untraceable and that Iran is using it to strengthen its military and to fund terrorism.

“The reason why a cash payment raises serious questions should be obvious,” Mukasey said in his testimony. “Iran is a designated state sponsor of international terrorism…The only reason to insist that cash in the form of Euros and Swiss francs be provided to Iran — in Iran — is to permit that money to be distributed outside its borders in a way that cannot be traced. The activity that Iran pursues outside its borders that requires untraceable funds is terrorism.”

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