US Indicts Sanctions Violators but Remains Permissive Toward Tehran

As well as further demonstrating the depth of Iranian efforts to evade US-led sanctions, this story indicates that at least in some instances, the US Department of Justice is still following up on reports to this effect. These sorts of arrests and prosecutions stand in contrast to the large-scale relief from economic sanctions, which has been proffered to Iran as part of the Joint Comprehensive Plan of Action. The enforcement efforts may also function as a counterpoint to American lawmakers’ criticisms of the Obama administration’s Iran policy, which has widely been described as overly permissive. 

However, occasional instances of enforcement are hardly enough to counterbalance the sources of those criticisms, some of which continue to be subject to close scrutiny and the revelation of new information. For example, in January, the administration settled an outstanding debt related to an uncompleted arms sale to the Shah, and months later that payment came to be regarded by Republicans and some Democrats as a payment of “ransom” for American citizens being held in Iranian jails. The administration itself acknowledged that the money was held back to be used as “leverage” in securing the release of the prisoners, though it has denied that this constitutes ransom. 

In the ensuing months, critics of the Obama administration have called attention both to new details about the payment and to the potential effects of that payment on Iran and particularly on its pattern of arresting and issuing harsh sentences to Iranian-Western dual nationals. Now, Mosaic Magazine has published an in-depth report on the payment, once again alleging that the administration’s actions were much worse than was previously believed. 

Specifically, the article argues that the payment was made prematurely and that it actually violated a law dating to the end of the Clinton administration, which required that Iran pay the penalties established by American court cases related to Iran-backed terror, before the US could be allowed to repay the supposed debts related to Foreign Military Sales. Mosaic emphasizes the uncertainty about whether such debts were actually owed to Iran by the US, in that there were related claims pending over Foreign Military Sales, with the US as the plaintiff and Iran as the defendant. 

According to Mosaic, this means that it is highly likely that judgments in international court would have determined Iran to owe more to the US than the US owed to Iran, thereby cancelling out the 1.7 billion dollar debt that the Obama administration paid beginning on January 17. Furthermore, this figure represented the apparent maximum amount that the US would have been obligated to pay, contrary to White House claims that the immediate settlement saved US taxpayers billions of dollars over what Iran had been demanding. 

While it may be true that Iran was making exorbitant demands, the Mosaic report finds no evidence that those demands were legally substantiated or that legal precedents at the Hague would have allowed for collection of anything more than 1.3 billion dollars in interest on the 400 million dollar principal debt. 

Both in the Mosaic report and in the preexisting criticism of the debt repayment, uncertainty about the US’s financial obligations is only one part of the story. The larger point of contention seems to relate to how Iran is expected to spend money acquired through these settlements, especially in light of a lack of enforcement or safeguards by the US government and the international community. Mosaic states that Iran has been and continues to be extremely brazen in its support of terrorism, to the point that the government even has a line item for such expenditures in its annual budget. A major concern among critics of January’s payment is that that money will be largely dedicated to this purpose, and that it could have otherwise been used to pay compensation owed to previous victims of Iran-backed terror attacks. 

Several of these incidents are detailed in the Mosaic report, as are the legal judgments handed down against Iran as a result of them. The Victims of Trafficking Violence Protection Act demanded that those judgments be paid before the arms sale debt was repaid to Iran, and the White House has provided no legal justification for ignoring or circumventing this provision. And according to Mosaic, the neglect of that provision represented not only a violation of the law, but also a deviation from previous foreign policy, as in the case of Libya, where settlement of terror-related claims was successfully put forward as a precondition of normalizing relations with the US. 

Just as US lawmakers are concerned that the apparent ransom payment will encourage ongoing hostage-taking, so are they concerned that willful neglect of Iran’s terror support network will embolden more of the same behavior. And the potential impact of that emboldening can be seen throughout the region. In October, missiles belonging to the Iran-backed Houthi rebels were fired from Yemen toward US warships in the Red Sea. And in Iraq and Syria, Shiite militias continue to vie for influence over regions reclaimed from ISIL. Some of those militias openly declare allegiance to the Iranian supreme leader. 

On Tuesday, the World Tribune provided new updates about the role of those militias in the fight to capture the ISIL stronghold of Mosul in Iraq. The article noted that Iran’s political influence over Baghdad had allowed for those forces to be welcomed into the outskirts of Mosul, although not into the city itself for the time being. But major conflict is expected at the town of Tal Afar, 45 miles outside of Mosul, and the Tribune describes this as putting Iranian and Turkish proxies on a collision course, as both fight to defeat ISIL but replace it with their own brand of influence.  

Although the US has traditionally supported some of the same rebel groups as has Turkey, there is little sign of Western nations making efforts to legitimize the Turkish presence or to obstruct that of Iran’s local proxies, many of which have been accused of attacking Sunni civilian populations and committing crimes against humanity which rival those of ISIL.