'We Don't Pay Ransom For Hostages': Obama Denies $400 Million Cash Payment To Iran Was To Secure Release Of Americans
WASHINGTON (CBSNewYork/AP) -- President Barack Obama vigorously denied that a $400 million cash payment to Iran was ransom to secure the release of four Americans jailed in Tehran. He defended the transaction as evidence that the nuclear accord with Iran has allowed for progress on other matters.
"This wasn't some nefarious deal," Obama told reporters at the Pentagon. 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."
"We do not pay ransom for hostages. We got a number of Americans being held all around the world, and I meet with their families, and it is heartbreaking," Obama said. "The notion that we would somehow start now, in this high-profile way, and announce it to the world, even as we're looking into the faces of other families whose loved ones are being held hostage and say to them that we don't pay ransom defies logic. We didn't here and won't in the future."
The cash was delivered to the Iranian government in January, at the same time the nuclear deal was settled and the Americans were released. The payment was part of a decades-old dispute over a failed military equipment deal dating to the 1970s, before the Islamic revolution in 1979. It was delivered to Iran on palettes aboard an unmarked plane.
"The reason that we had to give them cash is precisely because we're so strict in maintaining sanctions and we do not have a banking relationship with Iran, that we couldn't send them a check and we could not wire the money," Obama said.
The president told reporters he was somewhat shocked at how this became a news story.
"It is not at all clear to me why it is that cash, as opposed to a check or a wire transfer, has made this into a news story," Obama said. "Maybe because it kind of feels like some spy novel or some crime novel because cash was exchanged."
Earlier in Buenos Aires, Argentina, Kerry told reporters that the "story is not a new story" and "was announced by the president of the United States himself at the same time."
The settlement stemmed from a claim filed by Iran with an international tribunal in 1981 that related to a $400 million payment made by the government of the U.S.-backed Shah of Iran to purchase military equipment in 1970s. The equipment was never delivered because, in 1979, his government was overthrown and revolutionaries took American hostages at the U.S. Embassy in Tehran. Diplomatic relations were subsequently severed although the two countries did agree to set up the tribunal to rule on claims from both nations.
U.S. officials have said they were concerned that the 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."
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