Secretary of State John Kerry acknowledged on Thursday that Iran will likely use some of the tens of billions of dollars its receives as a result of sanctions relief under the nuclear deal to sponsor terrorists.
“I think that some of it will end up in the hands of the IRGC [Islamic Revolutionary Guard Corps] or of other entities, some of which are labeled terrorists to some degree,” he told CNBC in Davos, Switzerland. “I’m not going to sit here and tell you that every component of that can be prevented.”
Kerry said there were no indications yet that released funds were being directed “to that kind of endeavor” but that he was “sure at some point some of it will.”
He went on to suggest that the impact in the region of such funding would be limited, pointing to the much larger military spending by Gulf Arab states in comparison to Iran.
“The Saudis alone spend $80 billion a year on defense. The entire Gulf state community spends 130 billion a year on defense,” he said. “Iran spends 15 billion a year on its military activities. So it’s so incredibly disproportionate.”
The U.S., by working with its Gulf state partners, would be able to guarantee their security, he said. It would “stand by them, even as we look for this potential other shift in behavior.”
In Washington, Republican senators responded scathingly.
“Talk about stating the obvious,” the Associated Press quoted Sen. Kelly Ayotte (R-N.H.) as saying, adding that even when Iran’s economy was crippled by sanctions it was funding “guns, not butter.”
“To have them actually now say, ‘Well, we think some of this might go to terrorism.’ D’uh. I mean, really?”
At a press conference with several Senate colleagues focusing on Iran, Ayotte said it had been obvious from the outset.
“Finally Secretary Kerry acknowledged what all of us who have opposed this [nuclear] agreement from the beginning saw was obvious – that when they got this economic relief and lifting of the sanctions that in fact some of that money was going to support their terrorism in the region,” she said.
Sen. Lindsey Graham (S.C.) disputed that Iran’s use of the freed-up funds for terror was merely likely, saying in words directed at Kerry that it was “certain that they will use this money to support terrorism. You might as well as have written the check to [Syrian President Bashar] Assad yourself; you might as well have funded Hezbollah yourself.”
“So all of this cash going into the ayatollah’s pockets won’t stay long,” Graham said. “It’s not going into roads and bridges in Iran, it’s going into war machines throughout the Mideast and to think otherwise is completely naïve.”
In Davos, Kerry said Iranian President Hasan Rouhani had indicated that he wants to use the nuclear deal “as a departure point for something new” – although he conceded that “just saying it doesn’t make it happen. You have to now test it and see where we’re going.”
Kerry told the network Iran would likely get $55 billion in sanctions relief, not the considerably larger sums sometimes reported.
“It’s not 150 billion, it’s not 100 billion. Iran will get approximately – according to the Treasury Department and all of the analysis of our intelligence community – about $55 billion,” he said.
“Why won’t they get the 100 [billion] that some people refer to? Because a large chunk of it is already committed to China, to other countries through loans and long-term commitments that have been made.”
‘This is a sovereign country that will make their own decisions’
The IRGC which Kerry referred to is not itself designated a foreign terrorist organization (FTO) under U.S. law, despite efforts by Republican lawmakers to prod the administration into doing so. (While in the U.S. Senate, Kerry opposed such a move, as did then-Senators Barack Obama and Joe Biden; Hillary Clinton did not.)
Iran is a primary sponsor of violent anti-U.S. Shi’ite militias in Lebanon (Hezbollah) and Iraq (Khata’ib Hezbollah and others). It has also long supported Palestinian terror groups such as Hamas. Hezbollah, Khata’ib Hezbollah and Hamas are all designated FTOs.
Shortly after the nuclear deal was announced last July, Kerry downplayed concerns about sanctions relief money benefitting terrorists, arguing that the Iranian government had more pressing priorities.
“If President Rouhani and his administration do not [use the freed-up funds to] take care of the people of Iran, they will have an enormous problem,” he told the BBC at the time.
In similar comments earlier last year, White House press secretary Josh Earnest conceded that the administration would not be able to prescribe how Iran uses the money its sanctions relief windfall, but said it was “common sense” to expect Tehran would use it to improve the ailing economy, not to increase funding for terrorism or for other destabilizing actions in the region.
“I’m not going to make any predictions about what they are going to do, and I’m certainly not going to be in a position to prescribe what they should do,” he said. “This is a sovereign country that will make their own decisions.”