Senate Republicans say the Obama administration misled the American people because it had promised Congress that Iran wouldn't gain access to America's financial system.
The effort was unsuccessful because American banks - themselves afraid of running afoul of USA sanctions - declined to participate.
U.S. Senator Rob Portman (R-OH), chairman of the Permanent Subcommittee on Investigations (PSI), Wednesday unveiled a majority report detailing, for the first time, how the Obama administration secretly granted a license authorizing the conversion of Iranian assets worth billions of U.S. dollars using the U.S. financial system - despite repeated assurances to the public and Congress that Iran would not be granted access to the U.S. financial system. They did this by first exchanging the Omani currency into USA dollars. Ambassador Thomas Shannon from the State Department testified that there would not be an "exchange of dollars inside the USA financial system" and that Iran would not have access to the larger US financial system. But Jarrett Blanc, former State Department coordinator of the Iran deal, called the report "wildly overblown".
Just three months earlier, the same agency issued a specific license for Iran to access to the USA financial system and the US dollar.
The Obama administration skirted their own key USA sanctions to grant Iran access to billions in hard currency despite public assurances the administration was engaged in no such action, according to a new congressional investigation, details published by the AP and other sources. Now it has become clear that even the terms that were ultimately agreed to were not honored by the Obama Administration. "This specific license was in fulfillment of JCPOA commitments to give Iran access to pools of its money held overseas".
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The findings are at odds with statements from senior Obama White House, State Department and Treasury Department officials who repeatedly said Iran would continue to lack access to the US financial and commercial markets following the implementation of the Iran deal, also known as the Joint Comprehensive Plan of Action (JCPOA). Iran as a substitute approached the US a couple of waiver - one which the Obama administration granted in February 2016, in a transfer that had not been beforehand disclosed. It did not allow Iran to conduct commercial transactions in foreign currencies via the U.S. banking system.
However, the banks declined to participate out of fear that doing so would harm their reputations.
That source pointed out that the license "did not authorize Iran to conduct commercial transactions denominated in United States dollars".
"To be clear, the U.S. Department of Treasury is not working on behalf of Iran to enable Iranian access to U.S. dollars elsewhere in the global financial system, nor are we assisting Iran in gaining access to dollar payment systems outside the U.S. financial system".
Because the clock counts down till US secondary sanctions are snapped again into place, European nations should weigh whether or not doing enterprise with Iran is price dropping entry to the USA monetary system or dealing with US sanctions penalties. Treasury Department officials downplayed any potential future penalties or fines, stating that 95 percent of the time, OFAC sends a warning letter or takes no action.
In one secret meeting, US officials "signaled that it would not aggressively enforce violations of the new sanctions regime", investigators found.