Administration takes bipartisan fire over Iran payment

The Obama administration is facing bipartisan skepticism over its $1.7 billion cash payment to Iran to settle a decades-old lawsuit that coincided with a prisoner swap.

Senate Banking Committee Republicans and Democrats said in a Wednesday hearing they’re concerned about the implications and precedent set by the payment. They focused on the fallout from giving Iran–the world’s foremost state sponsor of terrorism–more than $1 billion in untraceable money.

{mosads}“Hard cash is the preferred currency of terrorism,” said Sen. Mark Kirk (R-Ill.), chairman of the Banking subcommittee on national security. “How much more harm can Iran and its terrorist allies to do Americans and the world?” 

“An unchecked Iran poses not only a threat, but a grave threat,” added Sen. Heidi Heitkamp (N.D.), subcommittee ranking Democrat. “I hope this hearing can shed some light on those answers.”

Wednesday’s hearing followed weeks of criticism from Republicans, who say the $1.7 billion payment in European cash was ransom for four American prisoners in Iran. 

The Obama administration counters that the cash settlement of the almost 40-year-old lawsuit was part of two other simultaneous diplomatic efforts: the prisoner swap and the implementation of the Iran nuclear deal.

Suzanne Maloney, deputy director of foreign policy at the left-of-center Brookings Institution, said the Obama administration followed decades of precedent coupling financial and diplomatic settlements.

Administration officials have also insisted immediate payment was part of the settlement, and that the settlement could only happen via cash, because U.S. sanctions passed by Congress isolated Iran from the international financial system.

But Republicans have pointed to several recent US payments to Iran through other means, doubting the administration’s rationale.

“There could be only one purpose in which cash was useful,” said Michael Mukasey, attorney general under George W. Bush, “sponsoring terrorism around the world.”

“That money is going to buy a lot of dead westerners,” he said.

Mukasey also suggested that Iran could use the cash to buy nuclear weapons from North Korea.

“When you have a cash-starved country like North Korea that is conducting nuke tests,” said Mukasey, “that is a distinct danger.”

Senators also questioned witnesses as to whether the administration was legally allowed to make the payment. Sen. Bob Menendez (D-N.J.) pointed to a 2000 law that limits US payments to Iran until American terror victims with lawsuits against Iran conclude their cases.

“This action took place so precipitously,” said Menendez, who opposed the Iran nuclear deal. “Those victims of terrorism who have outstanding claims and have not been satisfied in the case of Iran were cheated out of the opportunity.”

Lawmakers have filed several bills meant to crackdown on future payments. One from House Foreign Affairs Committee Chairman Ed Royce (R-Calif.) blocks all cash payments to Iran and adds transparency requirements for future settlements between Iran and the US.

Another from Rep. Mike Pompeo (R-Kansas) and Sen. Marco Rubio (R-Fla.) would block the Treasury Department’s Judgment Fund until Iran returns the January cash payment and settles cases with American victims of terrorism.