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H.R. 5931, Prohibiting Future Ransom Payments to Iran Act

Floor Situation

On­­­­ Thursday, September 22, 2016, the House will begin consideration of H.R. 5931, Prohibiting Future Ransom Payments to Iran Act, under a structured rule. H.R. 5931 was introduced on September 6, 2016, by Rep. Ed Royce (R-CA) and was referred to the Committee on Foreign Affairs.


Summary

H.R. 5931 prohibits the United States Government from making any cash payments to the Government of Iran until the President certifies Iran is not a primary money laundering concern or a state sponsor of terrorism. The bill states that the policy of the United States Government not to pay ransom or release prisoners for the purpose of securing the release of United States citizens taken hostage abroad.

The bill also increases transparency and reporting requirements related to settlements and judgments under the Iran-United States Claims Tribunal.


Background

On January 17, 2016, President announced that the United States would pay Iran $1.7 billion to settle a dispute over an aborted arms sale that had dragged on since the radicals that rule Iran seized power in 1979. The White House initially rejected concerns that this settlement amounted to a ransom for the release of the American hostages and refused to answer questions from Congress.[1]

In August, 2016, the Obama Administration “secretly organized an airlift of $400 million worth of cash to Iran that coincided with the January release of four Americans detained in Tehran, according to U.S. and European officials and congressional staff briefed on the operation afterward.

Wooden pallets stacked with euros, Swiss francs and other currencies were flown into Iran on an unmarked cargo plane, according to these officials.” At the time, “Senior U.S. officials denied any link between the payment and the prisoner exchange [that occurred on the same day].”[2]

State Department Spokesmen John Kirby later told reporters that the U.S. would not allow Iran to take possession of the money until the American prisoners had been released. He then added, “We took advantage of leverage that we felt we could have to make sure that they got out safely and efficiently.”[3]

There is no provision under current law that prohibits the U.S. Government from making payments in exchange for certain actions or to fulfill certain settlement agreements. However, Presidential Policy Directive (PPD) 30 states that “It is United States policy to deny hostage-takers the benefits of ransom, prisoner releases, policy changes, or other acts of concession. This policy protects U.S. nationals and strengthens national security by removing a key incentive for hostage-takers to target U.S. nationals, thereby interrupting the vicious cycle of hostage-takings, and by helping to deny terrorists and other malicious actors the money, personnel, and other resources they need to conduct attacks against the United States, its nationals, and its interests.”[4]

According to the bill sponsor, “The Obama administration forked over a massive cash ransom to Iran, emboldening the world’s leading state sponsor of terror and putting more lives at risk.  All of this was done in secret, hidden from the American people and from Congress.  This bill will ensure it doesn’t happen again.”[5]


Amendments

  1. Rep. Ed Royce (R-CA) – This amendment clarifies prohibited forms of payment to Iran include monetary instruments and precious metals
  2. Rep. Mike Pompeo (R-KS) – This amendment prohibits the U.S. government from making random payments.
  3. Rep. Mike Pompeo (R-KS) – This amendment imposes sanctions on Iranians involved in kidnapping or unjustly detaining U.S. citizens.
  4. Rep. Sean Duffy (R-WI) – This amendment prohibits cash and precious metal payments to designated state sponsors of terrorism and North Korea in addition to Iran.
  5. Rep. Eliot Engel (D-NY) – This substitute amendment strikes the text of the committee print and replaces it with text that requires the President to notify Congress of a payment made to any state sponsor of terrorism of North Korea pursuant to a settlement or judgement against the United States. The amendment further requires the President to report on pending claims before the Iran-U.S. Claims Tribunal.

Cost

The Congressional Budget Office (CBO) estimates enacting the bill would impose limitations on the ability of the federal government to make such payments to Iran and thus could reduce direct spending, therefore, pay-as-you-go procedures apply. However, CBO has no basis for estimating the timing or amounts of those effects, if any. Enacting the bill would not affect revenues.


Staff Contact

For questions or further information please contact John Huston with the House Republican Policy Committee by email or at 6-5539.

 

 


 

 

[1] See WSJ Article, “U.S. Payment of $1.7 Billion to Iran Raises Questions of Ransom,” January, 21, 2016.
[2] See WSJ Article, “U.S. Sent Cash to Iran as Americans Were Freed,” August 3, 2016
[3] See WSJ Article, “U.S. Acknowledges Cash Payment to Iran Was ‘Leverage’ in Prisoner Release,” August 18, 2016.
[4] See White House Press Release, “Presidential Policy Directive -- Hostage Recovery Activities,” June 24, 2015.
[5] See Foreign Affairs Committee Press Release, “Chairman Royce Introduces Bill to Block Ransoms to Iran,” September 6, 2016.

114th Congress