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U.S. to Return $454 Million in Iran Funds

May 12, 1987|United Press International

WASHINGTON — The United States has accepted the decision of The Hague tribunal on Iranian assets held by the United States and will return about $454 million to Iran, the State Department said today.

The settlement of the claims, dating back to 1981, removes one of the major issues that the Iranian government has used as an explanation for the tense relations between the two countries and for the taking of U.S. hostages in Lebanon by pro-Iranian groups.

In accepting the decision by the joint tribunal, set up in 1982 as the result of the settlement of the embassy hostage crisis, the State Department explicitly ruled out any link between the return of the Iranian assets held by the United States and any hint that it was a form of ransom being paid to get Iranian cooperation in the release of American hostages in Lebanon.

$66 Million Retained

The U.S. government agreed to transfer about $454 million from an account held by the Federal Bank of New York, which now contains $520 million. The remaining $66 million will be used to satisfy outstanding claims by creditors.

The account contained Iranian government funds originally meant for purchases of arms and other U.S. items. The sales were cut off and the money was frozen in 1980 in retaliation for the Iranian seizure of the U.S. Embassy in Tehran in 1979.

As part of the agreement ending the 444-day crisis, both countries agreed to abide by the decisions of The Hague International Tribunal.

However, the United States delayed the return of the money until the U.S. government was satisfied that there was no link--implied or actual--that would suggest that the Administration was paying a form of ransom for the seven American hostages still being held in Lebanon, some of them by groups believed close to the Iranian government.

The money will be transferred to Iranian government accounts on Wednesday.

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