US says cash payment to Iran was ‘leverage’ in prisoner release

The US acknowledges the cash payment of $US400 million to Iran was “leverage” in prisoner release.

The Obama administration said its $US400 million payment to Iran was used as “leverage” to gain the release of Americans.

The Obama administration said for the first time yesterday its $US400 million cash payment to Iran in January was used as “leverage” to gain the release of American prisoners, fuelling criticism the exchange amounted to the US paying ransom.

State Department spokesman John Kirby confirmed the US refused to allow Iran to take possession of the cash until a plane carrying the freed Americans had taken off from Tehran.

“If you’re asking me was there a connection in that regard, at the endgame, I’m not going to deny that,” Mr Kirby said.

“We took advantage of leverage that we felt we could have to make sure that they got out safely and efficiently.”

He was responding to a report in The Wall Street Journal disclosing that an Iranian cargo plane was not permitted by the US to leave Geneva with $US400m in euros, Swiss francs and other currencies stacked on shipping pallets until the Americans had left Tehran. The exchange took place on January 17.

Administration officials, including Barack Obama, have said the cash payment was not ransom because the $US400m was money the US already owed Iran to settle a failed arms deal from more than three decades ago.

Republican senator Ben Sasse said Mr Kirby’s statements yesterday showed the cash transfer to Iran was a ransom payment. “If it quacks like a duck, it’s a duck,” he said.

“If a cash payment is contingent on a hostage release, it’s a ransom. The truth matters and the President owes the American people an explanation.”

Fellow republican senator Tom Cotton said the cash payment sent a message to extremists that “the United States will pay cold, hard cash for hostages”.

Republican leaders in congress plan to hold hearings on the cash transfer next month.

Mr Kirby said repeatedly the payment didn’t amount to ransom. “We don’t pay ransom,” he said. Instead, he portrayed the cash as a useful tool: “It would have been foolish, imprudent, ­irresponsible for us not to try to maintain maximum leverage.”

US officials say the prisoner release and the arms-deal settlement were negotiated through separate diplomatic channels, and deny the two were linked.

The White House said in January the US would pay Iran $US400m in the first instalment of a $US1.7 billion settlement to resolve a legal dispute over the failed arms deal.

Administration officials did not say at the time the $US400m already had been paid in cash to Iran and had refused to answer questions about how and when the payment took place. Officials said the legal dispute could have cost the US $10bn without January’s settlement.

The Wall Street Journal