State Department Says $400 Million Payment to Iran Was Used as Leverage in Prisoner Release

President Barack Obama during a news conference at the Pentagon in Washington, on Aug. 4, 2016. (AP Photo/J. Scott Applewhite)

The State Department said on Aug. 18 that the timing of a $400 million payment to Iran in January was linked to the release of four U.S. hostages.

According to State Department spokesman John Kirby negotiations over the payment, which stemmed from a legal case over Iranian funds frozen by the U.S., and negotiations over the release of U.S. citizens were conducted separately, but that the payment was used as leverage. 

As part of the prisoner exchange deal, seven Iranians detained were exchanged for four Americans, including Washington Post journalist Jason Rezaian, Idaho pastor Saeed Abedini, and former Marine Corps Sergeant Amir Hekmati.

A recent report from the Wall Street Journal had reported that the cargo plane used to transport the money was not permitted by the United States to leave Geneva until the prisoners had left Iran.

“Obviously, when you’re inside that 24-hour period and you already now have concerns about the end-game in terms of getting your Americans back, it would have been foolish, imprudent, and irresponsible for us not to try to maintain maximum leverage,” said Kirby on Thursday.

“If you’re asking me if there was a connection in that regard in the end-game, I’m not going to deny that,” Kirby said.

U.S. officials had said previously the $400 million was the first installment of a $1.7 billion settlement the Obama administration reached with Iran to solve a decades-old dispute over a failed arms deal. The settlement, which was resolved before an international tribune, occurred on the same weekend the United States and other global powers brokered a nuclear deal with Iran.

The State Department’s admission comes after President Barack Obama said on Aug. 4 that the $400 million cash payment to Iran was not a ransom.

“We don’t pay ransom for hostages,” Obama said earlier this month, adding that Americans are held prisoners around the world and that “we won’t pay ransoms in the future.”

The president also said the notion of paying a ransom to Iran in that manner, and so publicly, “defies logic.”

Obama had said the reason why the payment coincided with the release of prisoners and the nuclear deal was because the United States and Iran were having diplomatic conversations for the first time in decades. The president also said that the reason why the money was given in cash was because the United States is “so strict in maintaining sanctions” and because the country has “no banking relationship” with Iran.

However, Iranian media reported in February that the money was in exchange for the prisoners. Broadcaster TVV reported that the $1.7 billion, along with the release of the Iranian prisoners and dropping extradition requests for other individuals, was in exchange for the freedom of the four Americans. 

Since the release of the detainees in January at least one other Iranian-American has been detained.

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