Administration officials say "no deal" to a new Iranian attempt to link the release of U.S. hostages in Lebanon to settlement of a longstanding financial claim.
At the same time, officials say they are still interested in continuing negotiations to settle claims between the United States and Iran.The issue was raised Tuesday by Iranian Parliament Speaker Hashemi Rafsanjani in comments broadcast on Iranian television and monitored in Washington.
In the interview, it was not clear exactly which contested funds Rafsanjani referred to, but it appeared he was talking about $1 billion in a foreign military sales escrow fund the former shah's government had created for the purchase of weapons.
The arms were embargoed during the Islamic Revolution of 1979 that deposed the shah and brought the Ayatollah Ruhollah Khomeini to power. The new Iranian government claimed the money, but it also took Americans hostage in the U.S. Embassy, and the U.S. government kept the funds frozen.
Another $1.5 billion remains in a bank account known as "security account number 1," but that fund is under arbitration at The Hague. The interest alone on both claims has amounted to about $200 million annually.
"It is not a question of denying the individual claims or the accumulated interest," one State Department official said Tuesday. "We insist there can be no link to these claims and the hostages."
There is great disparity between Iran's estimate of the money owed and what the U.S. government accepts. Iranian claims taken cumulatively could amount to $11 billion, but U.S. officials believe the final settlement, when claims from both sides are resolved, will show the United States owes about $1 billion.