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Obama Says $400 Million Payment To Iran Not 'Nefarious' Ransom Deal

  • RFE/RL

U.S. President Barack Obama has dismissed criticism of his administration's $400 million cash payment to Iran to settle a long-standing legal claim, adamantly rejecting charges that it was a ransom paid for the release of imprisoned Americans.

"This wasn't some nefarious deal," Obama told reporters at the Pentagon on August 4. He pointed out that the payment, along with an additional $1.3 billion in interest to be paid later, was announced by the administration publicly when it was concluded in January, a day after the implementation of a landmark nuclear agreement with Iran.

"It wasn't a secret. We were completely open about it."

Obama said the one new piece of information, first reported this week by The Wall Street Journal, was that the $400 million was paid in cash. It was delivered to Iran on palettes aboard an unmarked plane.

"The only bit of news is that we paid cash," he said. "The reason that we had to give cash is precisely because we are so strict in maintaining sanctions and we do not have a banking relationship with Iran."

The payment has revived allegations from critics of the Iran nuclear deal. The timing of the arrival of the cash coincided with the release of the four detained Americans as well as implementation of the nuclear deal, leading to charges that the settlement of the 35-year-old claim was a "ransom" payment.

"We do not pay ransom for hostages," Obama said, citing long-standing U.S. policy not to pay for fear of encouraging abductions. "We didn't here and we won't in the future."

The settlement stemmed from a claim filed by Iran with an international tribunal in 1981 for reimbursement of a $400 million payment made by the shah of Iran to purchase military equipment in the 1970s. The equipment was never delivered because of the 1979 Islamic Revolution that toppled the shah.

U.S. officials have said they were concerned that The Hague tribunal might order the U.S. to pay billions more in interest as part of an enforced judgment and that settling the claim in January made good sense.

"It was the assessment of our lawyers that there was significant litigation risk and we could end up costing ourselves billions," Obama said. "Their advice was that we settle."

With reporting by AP, AFP, and Reuters
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