U.S. Rep. Stephen Lynch today acknowledged "the optics were not good" as news broke the Obama Administration had sent $400 million in cash to Iran in a deal that coincided with the January release of four Americans detained in Tehran, but said the money exchange was a separate settlement that had been long in the works.
“The timing obviously raised some eyebrows,” Lynch said today on Herald Radio. “This was a long-standing claim that was outstanding, so I agree that it looks bad, but I don’t think it was a quid pro quo. I don’t believe that, no.”
The money, Lynch said, was part of an agreement the administration reached with Iran to resolve a dispute over a failed arms deal inked just before the fall of Shah Mohammad Reza Pahlavi and the Iranian hostage crisis in 1979. The claim had been before the international tribunal in The Hague, and the resolution coincided with the formal implementation of the Iranian nuclear deal, as did as the prisoner swap that freed four Americans detained in Teheran in exchange for seven Iranians.
“This was a swap. We swapped seven Iranians for four U.S. detainees in Iran and that’s how this works sometimes,” Lynch said. “The $400 million, I know it was transferred around the same time and it raises some eyebrows, but I think the deal would have been done regardless of the timing of that payment.”
Lynch said the U.S. State Department felt they were going to lose the case before the Hague and have to pay upwards of $10 billion in accumulated interest.
“This was their attempt to cut their losses,” Lynch said, adding the U.S. would have to pay additional interest that would bring the total to around $1.7 billion.
However, he conceded, “The optics are not good.”
The cash included Swiss francs, euros and other denominations and was stacked on pallets flown in January on an unmarked cargo plane – an arrangement made necessary by existing U.S. sanctions against Iran, Lynch said.
“We can’t ask any banks to do business with Iran, especially the Republican Guard,” he said. “So they had to go around to Switzerland and a couple of other countries and get euros and other domination notes and load it on pallets and send it on a cargo plane because there are no banks that will risk the charge of terrorist financing that comes along with feeding money to the Republican Guard…so that’s how it had to be paid.”
The story of the payment — which was never mentioned by the administration — was first reported by the Wall Street Journal.
Republican presidential nominee Donald Trump took to Twitter today to lambaste Hillary Clinton after the news broke, tweeting "Our incompetent Secretary of State, Hillary Clinton, was the one who started talks to give 400 million dollars, in cash, to Iran. Scandal!"
Lynch also discussed his call for Congress to reconvene and vote on emergency funding to combat the Zika virus.
"All you need to do is come in contact with one family that has a child with very severe birth defects to see the human costs," Lynch told "Morning Meeting" hosts Jaclyn Cashman and Kevin Franck. "It's devastating."
Lynch sent a letter Monday to House Speaker Paul Ryan and fellow Republican Senate Majority Leader Mitch McConnell. urging them to have House and Senate lawmakers return to Capitol Hill immediately to address President Obama's request for the funding as the risk of transmission spreads across the United States. Lawmakers are not scheduled to return to Capitol Hill until September.
This week, federal health officials advised pregnant women to avoid an area of Miami where mosquitoes are apparently transmitting Zika directly to humans. The virus has been linked to microcephaly and other critical birth defects.
Lynch, co-sponsor of a bill that provides $1.9 billion in emergency funding to fight Zika, has said he regards the virus as a "national security and public health crisis."
"The human costs are devastating, and then there are the financial costs, Lynch said. "What do you think will happen to the tourism industry in Florida and Louisiana and Mississippi along the Gulf Coast? It's also devastating from a financial standpoint."
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