Political Hostage-Taking Over the Two Billion Dollar Compensation

The issue of withdrawing 1.75 billion dollars from Iran's frozen assets to compensate the victims of the explosion at the U.S. Marine Corps headquarters in Beirut has turned into a new conflict within the system and a division between supporters and opponents of Hassan Rouhani's government. Conservatives accuse Rouhani and Zarif of creating conditions for the 'looting' of Iran's assets through optimism and passivity towards the U.S. government. In contrast, reformists and moderates point fingers at Ahmadinejad and his government for their 'mismanagement' in purchasing U.S. government bonds, claiming they not only acted with 'suspicious negligence' but also paid a generous amount of Iranian people's assets to a government that was ostensibly hostile. Even Akbar Torkan, a senior advisor to the president, has called on the Parliament and Judiciary to prosecute the previous administration for purchasing bonds from the U.S. and investing in a 'hostile country.' Mohammad Javad Zarif also described the confiscation of Iranian assets as street theft in similar language to the 'concerned' faction. Conservatives, especially the so-called 'Velayatmadar' forces, claim that the previous government's negligence does not absolve the current government of responsibility and that this issue should have been resolved during the JCPOA negotiations. The negotiating team argues that the condemnation of the Islamic Republic in U.S. courts was outside the scope of the JCPOA. The Obama administration also supported a ruling that the U.S. Supreme Court confirmed. The original incident dates back to an explosion at the U.S. and French Marine headquarters in October 1983 during the Lebanese Civil War. In that terrorist suicide attack, 241 U.S. Marines, 58 French peacekeepers, and 6 civilians were killed. The Islamic Jihad Movement claimed responsibility for this explosion. However, the then U.S. government initially identified the Iranian and Syrian governments as organizers and later accused those who subsequently founded Hezbollah Lebanon. According to their assessment, individuals such as Mustafa Badreddine and Imad Mughniyeh were behind this attack, which is considered the bloodiest day for the U.S. Navy since World War II, and they used the Islamic Jihad Movement's name as a cover. The Iranian government has always strongly denied involvement in the operation over the past 33 years. However, holding a ceremony to support the 1983 suicide bombing on December 3, 2004, by a group called the 'Committee for Commemorating the Martyrs of the Global Islamic Movement' in Behesht Zahra and installing a memorial raised suspicions against at least a radical part of the government. Although the 'Committee for Commemorating the Martyrs of the Global Islamic Movement' has always emphasized that it has no connection with official institutions of the Islamic Republic, the lack of prevention of their actions, given the sensitivity of the issue, fueled doubts. Twenty years later, in late 2003, a case was opened in a U.S. federal court regarding a lawsuit against the Iranian government for its involvement in the Beirut explosion. This court ultimately ruled in 2007 that Iran must pay 2.65 billion dollars to the victims' families due to the Iranian government's role in equipping and providing materials to the attackers. Throughout this period, such claims were always denied by the Iranian government, and on the other hand, no specific location for paying this compensation was identified. In 2012, the U.S. Congress passed a law titled 'Reducing the Threat of Human Rights Abuses by Iran and Syria,' which legalized the seizure of funds from Iran's central bank accounts and payment of compensation to the victims of terrorist attacks believed by Americans to have been orchestrated by Iran. The sanctions on the central bank also led to the freezing of its assets. Obama confirmed the congressional resolution a few days later. In October 2014, another judge rejected Iran's appeal and ruled that 1.45 billion dollars should be paid to the families of the victims of the Beirut explosion. After this incident, the central bank felt threatened. Therefore, in October 2015, three months after the signing of the nuclear agreement, the Central Bank of the Islamic Republic of Iran submitted its appeal to the U.S. Supreme Court. This request was rejected by the Supreme Court on April 20, 2016, and ultimately the rulings of U.S. federal courts were upheld. According to this ruling, 1,300 families of the American victims of the 1983 Beirut attack and other events deemed related to the Iranian government by U.S. courts, including the Khobar Towers bombing in Saudi Arabia in 1997, can withdraw their compensation from the location of Iran's central bank assets in Citibank, New York. Debra Peterson, the sister of one of the victims in Beirut, pursued the lawsuit. After the Supreme Court ruling, she stated that receiving money was never her goal; rather, she wanted justice for the organizers of the mentioned terrorist attack and accountability for their actions. Since lawyers for Iran's central bank have appeared in court and filed an appeal, the implementation of Zarif's and the officials' claims regarding non-acceptance of the ruling seems difficult. Additionally, the approval of a new amendment to the law on state immunity in the U.S. in 2012 also legally allows U.S. courts to issue orders for compensation payments from Iranian assets. The threat of a lawsuit in the Hague is also unlikely to come to fruition. The government has practically recognized the jurisdiction of the courts. According to Iraqchi's claim, the National Security Council has a resolution that the legitimacy of U.S. courts should not be accepted by Iran. It is unclear whether the central bank's appeal is case-specific and whether it conflicts with the National Security Council's resolution. The full dimensions of the decision-making regarding U.S. government bonds are still unclear. The 'moderates' claim that the ninth government decided in 2007 to use part of its foreign assets to purchase bonds. This decision was not communicated to the Parliament, and there is no resolution regarding it. Only the seventh Parliament granted the ninth government permission to make repeated withdrawals from the foreign exchange reserve account throughout the year, while also allowing the withdrawals to be included in that year's budget law. This investment may be part of the funds lost during Ahmadinejad's presidency. The lack of proposal and obtaining permission for investment in U.S. government bonds is inconsistent with the laws of the Islamic Republic. As Abbasali Noora, a member of the eighth Parliament's Planning and Budget Commission, explains, according to the law, whenever a currency transaction is to be made with another country and money or capital is to be held in another country, the entire matter must be presented and approved by the Parliament. There is no evidence that oversight bodies such as the Court of Audit and the Inspector General's Office were aware of the expenditure of this decision. However, banking officials from Ahmadinejad's government have a different narrative. Mahmoud Bahmani, the former head of the Central Bank, reacted to this issue by stating that the history of purchasing dollar bonds does not relate to my presidency at the Central Bank and goes back to before 2006. He also added that these bonds were part of the foreign exchange reserves belonging to the central bank, not the government, and that dollar bonds were held in European countries, not the U.S. Meyno Kiani Rad, the former foreign exchange deputy of the central bank, also stated in an interview that the seizure of two billion dollars of Iranian assets has nothing to do with our period and relates to earlier periods. At the same time, it is rumored that a former foreign exchange deputy of the central bank has been summoned to court regarding this matter and was released on bail after interrogation. However, the ninth government was negligent in not seeking to remove these assets from U.S. government access even after the intensification of sanctions after 2008. It seems that this problem has been inherited from the previous government or governments to Rouhani's government. Resolving it is also unrelated to the JCPOA. In fact, preventing such events requires continued de-escalation in relations with the U.S. and political and diplomatic negotiations. However, the hostile relations of the Islamic Republic and the existence of multiple historical cases, especially the seizure of the U.S. embassy, have created an environment conducive to issuing judicial rulings against Iran in the U.S. and led to rulings that at least some of them seriously raise suspicions of being politically motivated. Resolving these issues is not easy. The dispute that has arisen today clarifies the future outlook regarding the possibility of controlling other assets in Iran. Currently, the financial value of rulings issued against Iran in various U.S. courts exceeds 15 billion dollars. Conservatives and opponents of Rouhani's government are not seeking to disrupt the JCPOA; rather, they are using the nearly two billion dollar compensation as a platform to attack the government and devalue the JCPOA. They want to use this issue to prove the 'hostile' and 'enemy' nature of the U.S. against Iran and demand a continuation of the confrontational and ideological approach against the U.S. They also question the credibility of the government and its de-escalation approach in foreign policy, portraying it as incapable. The government and its supporters also aim to shift the responsibility for this waste of national capital to the previous government and extremist factions that created this problem with their radical actions and 'mismanagement.' They also seek to present the JCPOA as an approach to resolve these issues or prevent their recurrence. However, government officials have also emphasized that the JCPOA has not resolved the strained relations between Iran and the U.S. In fact, this tension reflects the confrontation of two currents that both believe in the enmity of the U.S. political system with the Islamic Republic, but one prescribes a confrontational approach while the other follows a cautious defensive and de-escalation approach. The country's dire economic situation, along with a significant decline in oil prices and the lack of a reliable outlook for its return to the hundred-dollar-per-barrel price channel, has made the JCPOA politically irreversible in the foreseeable future. The disputes are more about how to deal with the JCPOA. The government wants the JCPOA to be viewed as a benevolent act and a transformative measure to serve as a model for organizing various problems, while forces aligned with the leadership believe the JCPOA was an unavoidable evil that was deemed necessary to accept, but should only be considered an exception and not a rule. However, the two billion dollar compensation shows that contrary to the optimistic and pessimistic assumptions of both sides, as long as there is no significant change in the government's foreign policy and its orientation shifts from confrontation with the global order to compatibility and a reformist approach, problems and tensions with the U.S. will continue. The JCPOA is also an exception in U.S. policy, and its realization is owed to the presence of an individual in the White House who had a strong desire to resolve issues with Iran. Such an approach is in the minority within the U.S. administration. The path that led to the loss of nearly two billion dollars of Iranian public wealth reflects the flawed foreign policy trajectory after the seizure of the U.S. embassy and support for confrontational approaches with the West in the Middle East, which has imposed tens of billions of dollars in damages on Iran. If no measures are taken and reconciliation with the world does not become a sustainable and genuine strategy, then more assets from Iran will also be confiscated. Groups have serious plans for this purpose. Trapping Iran's assets and reserves in the global trade and financial network will not be impossible. The issue will not be limited to the recent judicial order of the U.S. Supreme Court.