Obama-era license aimed to let Iran convert money

Obama-era license aimed to let Iran convert money

Obama-era license aimed to let Iran convert money

And the Obama Treasury Department's issuing of a license to allow Iran to convert $5.7 billion it held at a bank in Oman was not illegal.

The Obama administration asked two United States banks to facilitate the conversion of the Iranian assets, but its effort was ultimately unsuccessful as the banks refused to take such action citing reputational damage in dealing with Iran and potential wrongdoing of violating existing U.S. sanctions.

But the Senate report revived criticism of how the Obama administration sought to accommodate Iran in connection with the nuclear deal.

Even though the Obama administration assured Congress the nuclear deal it negotiated with Iran wouldn't give Iran access to U.S. dollars or banks, the U.S. Treasury Department secretly authorized Iran to use U.S. banks to convert billions of Iranian assets into dollars, according to a new report released by Ohio GOP Sen.

As the United States negotiated with Iran, one important USA interest consistently remained off-limits: Iran would not be granted access to either the US financial system or the USA dollar. Iran's nuclear program would be unconstrained.

As the Obama administration pondered how to address Iran's complaints in 2016, reports in The Associated Press and other media outlets revealed that the USA was considering additional sanctions relief, including issuing licenses that would allow Iran limited transactions in dollars. Richard Blumenthal's (D-Conn.) warning that Iran would receive "an economic windfall" if Congress rejected the deal.

The issue also shows the importance of a close working relationship on such deals between Treasury and State, and the importance of closely overseeing such deals, the report says.

A report from the Permanent Subcommittee on Investigations chaired by Portman said the transactions authorized by the Obama administration never took place because two US banks refused to execute them. Six months later, the Obama administration was still lying about it.

Iran eventually found other ways to convert its money to Euros so it could access it. Marco Rubio, R-Fla., and Mark Kirk, R-Ill., Treasury officials declared "The U.S. Department of Treasury is not working on behalf of Iran to enable Iranian access to U.S. dollars elsewhere in the global financial system, nor are we assisting Iran in gaining access to dollar payment systems outside the U.S. financial system". Iran as a substitute approached the US a couple of waiver - one which the Obama administration granted in February 2016, in a transfer that had not been beforehand disclosed.

Though the nuclear deal kept certain sanctions in place, the license allowed Iran to access previously frozen assets totaling $5.7 billion in an Omani bank. The Obama administration approached two US banks to facilitate the conversion, the report said, but both refused, citing the reputational risk of doing business with or for Iran.

Investigators also found internal State Department emails, in which officials admitted that the Obama administration had "exceeded our JCPOA commitments" by authorizing Iranian access to USA banks.

Former Obama administration officials declined to comment for the record.

The situation resulted from the fact that Iran had stored billions in Omani rials, a currency that's notoriously hard to convert. The dollars were then to be converted into euros.

Because the clock counts down till US secondary sanctions are snapped again into place, European nations should weigh whether or not doing enterprise with Iran is price dropping entry to the USA monetary system or dealing with US sanctions penalties.

According to the report, a senior State Department official explained that such "transactions are prohibited by USA sanctions that are still in place, and which we were clear we would not be removing as part of the (Iran deal)". And Asian and European banks are wary because US regulators have levied billions of dollars in fines in recent years and threatened transgressors with a cutoff from the far more lucrative American market.

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