How Obama Mislead U.S. <br>In Advance of Ransom <br>For Iranian-held Hostages

The State Department spokesman finally admitted yesterday that the January 17 payment of $400 million to Iran and the release of the American prisoners were connected. He rejected the word “ransom,” asserting that the money had simply been “leverage,” a distinction that reporters demonstrated was semantic. He also argued there was “really nothing new here,” and invited reporters to “go back and look at the President’s comments …when all this happened.”Let’s do that.On the morning of January 17, President Obama announced that five Americans “unjustly detained by Iran” were “finally coming home.” He said he was responding with a “reciprocal humanitarian gesture” to grant clemency to seven persons (one Iranian and six Iranian-Americans) convicted or awaiting trial for violating sanctions on Iran.Then he said this: “With the nuclear deal done, prisoners released, the time was right to resolve” the dispute over the $400 million that Iran in 1979 paid into a Foreign Military Sales account at the Defense Department.The president did not disclose that the payment had been made in untraceable foreign cash; nor that it had been delivered, as reported yesterday by Jay Solomon and Carol E. Lee of the Wall Street Journal, to an Iranian airline sanctioned for its connections to Iran’s Islamic Revolutionary Guard Corp; nor that the IRGC may thus have gained control of the cash; nor that the administration lifted sanctions on the airline only the day before; nor that the administration had specifically linked the payment with the release; nor that the release and the payment had been virtually simultaneous.Even beyond all this, however, there are two additional problems with the President’s January 17 statement — which transcend the “ransom” issue and call into question the basis for making any payment to Iran whatsoever.First, the President portrayed the resolution as returning Iran’s “own funds, including appropriate interest,” for a total of $1.7 billion — which he said could save “billions of dollars that could have been pursued by Iran.” Two days later, his press secretary said the savings were “potentially up to $6 billion or $7 billion.” But on February 3, the House Committee on Foreign Affairs chairman, Rep. Edward Royce (R-CA), wrote to Secretary of State Kerry seeking a “detailed explanation of how the interest payment to Iran … was calculated,” and then wrote to Secretary Kerry again on June 1 reiterating his request, because:“Information since provided to the Committee by the Congressional Research Service indicates that the [Iran Claims] Tribunal has never awarded compound interest on this particular type of claim, but has instead calculated past payments with simple interest at a rate of 10 percent.”Chairman Royce calculated that, at 10% simple interest, the maximum exposure from Iran’s claim had been $1.8 billion — just slightly more than the $1.7 billion the administration paid. The administration still has not provided a computation of the “$6 billion or $7 billion” in interest supposedly avoided by the January 17 payment. The Royce computation indicates that on January 17 the administration simply conceded 95% of the maximum amount at stake.Second, in a January 29 letter to Secretary Kerry and Treasury Secretary Lew, Senator Blunt, a Republican of Missouri, noted that American courts had found Iran liable for bombings of our embassy and Marine Corps barracks in Beirut in 1983, Khobar Towers in Saudi Arabia in 1996, and other terror attacks. He cited a finding by the Congressional Research Service that there were some $43.5 billion in unpaid Iranian judgments. He questioned why the administration paid Iran $1.7 billion while those judgments remained outstanding, given the provisions of the “Victims of Trafficking and Violence Protection Act,” which was enacted in 2000.VTVPA directed Treasury to pay individuals who held judgments against Iran and provided that the U.S. would be “fully subrogated” (placed in their shoes to pursue the judgments against Iran). Moreover, the law directed that “no funds shall be paid to Iran … from the Foreign Military Sales Fund, until such subrogated claims have been dealt with to the satisfaction of the United States” (emphasis added). Senator Blunt’s letter stated that the damages in the cases against Iran “far exceed[ed] the $400 million” in Iran’s FMS account.Responding to Senator Blunt’s inquiry – more than six weeks later – Julia Frifield, Assistant Secretary of State for Legislative Affairs, wrote to him on March 15, acknowledging that VTVPA had converted the terror judgments into claims of the United States against Iran but stating that the claims had been “resolved” to secure the alleged “billions” of savings in interest:“The recent [$1.7 billion] settlement resolved those subrogated claims to the satisfaction of the United States by securing a favorable resolution on the interest owed to Iran and thus foreclosing a far higher award at the [Iran Claims] Tribunal.”If Chairman Royce’s computation is correct, there was in fact no “favorable resolution” that foreclosed “a far higher award,” much less the “$6-7 billion” the White House alleged in January. And Sen. Blunt’s letter raises an even larger question: if the amount in Iran’s FMS account was far less than the U.S. claims against Iran under VTVPA, why was there any payment to Iran at all?Iran obviously did not care whether the cash was called “leverage,” or whether a more accurate term were used. Iranian officials themselves deemed it “ransom” in Iranian press accounts. Moreover, Iran was aware of all of the facts the President omitted from his January 17 statement; only American citizens and their representatives in Congress were kept in the dark.Congress plans to hold hearings in September not only to ferret out all the facts, but to determine why they were withheld for seven months, until the the Wall Street Journal reported them. There are significant questions about the administration’s failure to answer specific questions in multiple letters from senators and representatives, and whether the cash given Iran enabled it to avoid the impact of 2015 legislation designed to prevent bank financing of Hezbollah.What we do know already, however, is that the President’s statement on January 17 was seriously misleading.Mr. Richman is a contributing editor of the New York Sun.

How Obama Mislead U.S. <br>In Advance of Ransom <br>For Iranian-held Hostages

How Obama Mislead U.S. <br>In Advance of Ransom <br>For Iranian-held Hostages

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