Former President Obama’s administration allegedly gave Iran access to the United States financial system, a new Senate GOP-authored report reveals.
The new report from the Senate Permanent Subcommittee on Investigations unveiled Wednesday indicated that, although officials promised to prohibit it, the Obama administration granted Iran a license allowing the access despite sanctions against it, Fox News reported.
“On Feb. 24, 2016, the Treasury Department issued a specific license to Bank Muscat to authorize the conversion of Iran’s rials to euros through ‘any United States depository institution …,’” the draft report read. “Even after the specific license was issued, U.S. government officials maintained in congressional testimony that Iran would not be granted access to the U.S. financial system.”
Subcommittee chairman, Sen. Rob Portman, slammed the “desperate” administration for misleading the American public.
“The Obama administration during the negotiation of the Iran deal misled the American people,” the Ohio Republican said, according to Fox News. “I think they did so because they were desperate to get a deal.”
“Senior U.S. government officials repeatedly testified to Congress that Iranian access to the U.S. financial system was not on the table or part of any deal,” the report read.
“Despite these claims, the U.S. Department of the Treasury, at the direction of the U.S. State Department, granted a specific license that authorized a conversion of Iranian assets worth billions of U.S. dollars using the U.S. financial system,” it continued.
The subcommittee noted that Iran had $5.7 billion in assets at Bank Muscat in Muscat, Oman at the time the Iran nuclear agreement was implemented in 2015. Using the U.S. financial system to convert the assets, maintained as Omani rials, “was the most efficient means, even though U.S. sanctions prohibited it,” according to the report.
According to The Hill:
The Omani Bank Muscat, on behalf of Iran, asked that the Office of Foreign Assets Control (OFAC) convert $5.7 billion in assets, a request that came shortly after the JCPOA went into effect because foreign banks were having problems converting Iran’s assets, the report says.
Iran wanted to convert the Omani rials to Euros, but the Omani rial’s value is tied to the U.S. dollar. In order for the conversion to be complete, the rials had to be converted to U.S. dollars, which would then be converted into euros. The report says that this conversion process was not allowed under U.S. sanctions, and that there were other options available to convert such funds — just less efficient.
Despite this, OFAC provided Bank Muscat with a specific license in February 2016, authorizing roughly $5.7 billion worth in Iranian assets to be processed through the U.S. financial system, the report says.
Two U.S. banks did not want to comply with the administration’s request to convert the money, however, citing legal concerns and the appearance of processing an Iranian transaction,, the report said.
“To further encourage the banks, one U.S. government official wrote ‘I agree it would be a good idea to have [Secretary] Lew engage [the U.S. bank]. If they refuse we can suggest [Secretary] Kerry will call, which will drive them nuts,” according to the report.
All this took place while lawmakers were continually assured by the Obama administration that the very transactions with the U.S. financial system were not actually happening.
“As the Treasury and State Department worked behind the scenes to help Iran access the dollar, the message to Congress remained the same: The JCPOA did not allow Iran to access the U.S. financial system,” the report read.
A senior State Department official told the subcommittee, which began investigating the transaction last year, that nothing in the Joint Comprehensive Plan of Action with Iran required the license that was issued. The unnamed official said the administration “’exceeded our JCPOA commitments’ because there was nothing in the JCPOA that required the issuance of the specific license,” according to the report.
A former Obama official, disputing the subcommittee’s conclusion argued that the “license cannot be described as ‘granting access to the U.S. financial system,’”
“This specific license was in fulfillment of JCPOA commitments to give Iran access to pools of its money held overseas. It was aimed solely to allow the movement of Iran’s own funds stranded at an Omani bank into euros at a European bank, where Iran could then make use of them,” the official said.
The report recommended a series of steps to ensure secret transacations such as those executed by the Obama administration in securing the Iran deal are prevented in the future.
“We now have an opportunity to fix the fundamental flaws in this deal and put in place a strong agreement that truly protects America’s national security interests and the interests of our allies in the region,” Portman said.
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