When $6 billion of unfrozen Iranian funds are wired to banks in Qatar as early as next week, it can trigger a rigorously choreographed sequence that may see as many as five detained U.S. dual nationals leave Iran and an identical variety of Iranian prisoners held within the U.S. fly home, based on eight Iranian and other sources aware of the negotiations who spoke to Reuters.
As a primary step, Iran on Aug. 10 released 4 U.S. residents from Tehran’s Evin prison into house arrest, where they joined a fifth, who was already under house arrest. Later that day U.S. Secretary of State Antony Blinken called the move step one of a process that may result in their return home.
They include businessmen Siamak Namazi, 51, and Emad Sharqi, 59, in addition to environmentalist Morad Tahbaz, 67, who also holds British nationality, the U.S. administration has said. The Tahbaz and Shargi families didn’t reply to requests for comment. A lawyer for the Namazi family declined to comment.
The identities of the fourth and fifth Americans, one in every of whom based on two sources is a girl, haven’t been disclosed. Reuters couldn’t establish which Iranian prisoners, in turn, could be swapped by the U.S.
At the middle of the negotiations that forged this deal between the superpower which Iran brands the “Great Devil” and the Islamic Republic which Washington calls a state sponsor of terrorism is the tiny but hugely wealthy state of Qatar.
Doha hosted no less than eight rounds of talks involving Iranian and U.S. negotiators sitting in separate hotels speaking via shuttle diplomacy, a source briefed on the discussions said, with the sooner sessions focused mainly on the thorny nuclear issue and the later ones on the prisoner releases.
Doha will implement a financial arrangement under which it can pay banking fees and monitor how Iran spends the unfrozen money to make sure no money is spent on items under U.S. sanctions, and the prisoners will transit Qatar after they are swapped, based on three of the sources.
“Iran initially wanted direct access to the funds but in the long run agreed to having access via Qatar,” said a senior diplomat. “Iran will purchase food and medicine and Qatar can pay directly.”
Reuters pieced together this account of previously unreported details concerning the extent of Qatari mediation of the key talks, how the deal unfolded and the expediency that motivated each parties to clinch the prisoner swap deal. Reuters interviewed 4 Iranian officials, two U.S. sources, a senior Western diplomat, a Gulf government adviser and the person aware of the negotiations.
The entire sources requested anonymity due to the sensitivity of a deal which hasn’t been fully implemented.
A State Department spokesperson said the U.S. was not able to announce the precise timing of the prisoner release. The Department also declined to debate the main points of what the spokesperson termed “an ongoing and highly sensitive negotiation.”
‘You possibly can construct trust’
The U.S. administration has not commented on the timing of the funds transfer. Nevertheless, on Sept 5, South Korean foreign minister Park Jin said efforts were under strategy to transfer Iran’s funds.
“The U.S.-Iran relationship just isn’t one characterised by trust. We judge Iran by its actions, nothing else,” the State Department spokesperson added.
Washington consented to the movement of Iranian funds from South Korea to restricted accounts held by financial institutions in Qatar, but no money goes to Iran directly, the spokesperson added.
Qatar’s Ministry of Foreign Affairs didn’t reply to Reuters’ request for comment on the main points of negotiations, Qatar’s role within the talks or the terms of the ultimate agreement.
Iran’s foreign ministry and its U.N. mission didn’t reply to detailed questions regarding this story.
The sources’ account of the negotiation shows how the deal sidestepped the major U.S.-Iran dispute over Iran’s nuclear goals, culminating in a rare moment of cooperation between the long-time adversaries, at odds on a bunch of issues from Iran’s nuclear program to the U.S. military presence within the Gulf.
Ties between the U.S. and Iran have been at boiling point since Donald Trump quit a nuclear cope with Iran as U.S. president in 2018. Reaching one other nuclear deal has gained little traction since then, as President Joe Biden prepares for the 2024 U.S. election.
The State Department spokesperson also said there had been no change in Washington’s overall approach to Iran, “which continues to be focused on deterrence, pressure and diplomacy.”
Once the funds are transferred, they will likely be held in restricted accounts in Qatar, and the U.S. could have oversight as to how and when these funds are used, the State Department spokesperson added.
The potential transfer has drawn Republican criticism that Biden, a Democrat, is in effect paying ransom for U.S. residents. But Blinken told reporters on Aug 10 the deal doesn’t mean that Iran could be getting any sanctions relief, explaining that Washington would proceed to thrust back “resolutely against Iran’s destabilizing activities within the region”.
The Qatari-led mediation gained momentum in June 2023, said the source briefed on the discussions, adding no less than eight rounds of talks were held since March 2022, with earlier rounds devoted mainly to the nuclear issue and later ones to prisoners.
“All of them realised that nuclear (negotiation) is a dead end and shifted focus to prisoners. Prisoners is more easy. It is simple to get and you may construct trust,” he said. “That is when things got serious again.”
Prisoners expected to transit Qatar
The Iranian, diplomatic and regional sources said that after the cash reaches Qatar from South Korea via Switzerland, Qatari officials will instruct Tehran and Washington to proceed with the releases under the terms of a document signed by each side and Qatar in late July or early August. Reuters has not seen the document.
The transfer to banks in Qatar is predicted to conclude as early as next week if all goes to plan, the source briefed on the talks said. Reuters was unable to discover the banks involved.
“American prisoners will fly to Qatar from Tehran and Iranian prisoners will fly from the U.S. to Qatar, after which be transferred to Iran,” the source briefed on the talks told Reuters.
In accordance with two Iranian insiders, the source briefed on the negotiations and the senior Western diplomat, the talks’ most complex part was arranging a mechanism to make sure transparency in the cash transfer and respect for U.S. sanctions. The $6 billion in Iranian assets – the proceeds of oil sales – were frozen under sweeping U.S. oil and financial sanctions against Iran. Then president Trump in 2018 reimposed the sanctions when he pulled Washington out of a deal under which Iran had restricted its nuclear program.
Issues discussed included the best way to ensure Iran only spent the cash on humanitarian goods and securing guarantees from Qatar on its monitoring of the method.
“To salvage the negotiations from collapse, Qatar pledged to cover the banking fees for the funds’ transfer from Seoul to Switzerland, and subsequently to Qatari banks, while also taking up the responsibility of expense oversight,” an Iranian insider briefed concerning the talks told Reuters.
The central bank governors of Iran and Qatar met in Doha on June 14 to debate the funds transfer, a second Iranian insider and the source briefed on the talks said.
The Central Bank of Iran and the Qatar central bank declined to comment .
The talks were led by U.S. Special Envoy for Iran Robert Malley — now on unpaid leave because his security clearance is under review — and by U.S. Deputy Special Envoy Abram Paley and Iran’s chief nuclear negotiator, Ali Bagheri Kani, said one Iranian official, two sources briefed on the negotiations and the Western diplomat.
Mehdi Safari, Iran’s deputy foreign minister for economic affairs, joined the Iranian delegation at two meetings in Qatar for talks on the funds transfer, one senior Iranian diplomat told Reuters. Qatari Minister of State on the Foreign Ministry Mohammed Al-Khulaifi was the go-between mediator.
Malley declined to comment. Paley, Kani and Al Khulaifi couldn’t be reached directly for comment.
