U.S. and Qatar Deny Iran Access to $6 Billion From Prisoner Deal

U.S. and Qatar Deny Iran Access to $6 Billion From Prisoner Deal

NY Times-Oct 13th2023

Michael Crowley reported from Washington and Alan Rappeport from Marrakesh, Morocco.

The United States and Qatar have agreed to deny Iran access to $6 billion recently transferred to the nation as part of a deal between Washington and Tehran that led to the release of five imprisoned Americans from Iran last month.

Wally Adeyemo, the deputy Treasury secretary, told House Democrats on Thursday that Iran would no longer have access to the funds, according to a person familiar with the matter. The money was under close supervision and strict conditions that it be used only for humanitarian purposes.

U.S. officials did not describe the money as frozen permanently but said that case-by-case applications to spend it under the current arrangement will be denied for the foreseeable future.

The move comes after harsh criticism, mainly from Republicans, that the Biden administration had given Iran a vast sum that freed up other funds for Tehran to provide support to Hamas before it attacked Israel over the weekend.

U.S. officials said they had not seen intelligence that Iran had directly assisted with the assault and that some senior Iranian officials were taken by surprise. But Tehran has been a major backer of Hamas for decades, and critics said the fungibility of money meant the restrictions had little meaning.

The Treasury Department, which oversees the funds, is not employing sanctions powers to formally freeze the money but has what was described as a quiet understanding with Qatar that Iran will be unable to retrieve it.

It is unclear whether the Biden administration may yet declare the funds permanently off limits. It is also unclear whether the action reflects any new analysis by the administration about Iran’s role in the attack.

Regardless, it is certain to infuriate Iran’s leadership after a painstaking prisoner swap that took many months to construct and weeks more to complete.

Speaking with reporters in Tel Aviv on Thursday, Secretary of State Antony J. Blinken would not confirm that Iran would be cut off from the account. But he noted that “none of the funds that have now gone to Qatar have actually been spent or accessed in any way by Iran.”