Biden Admin’s Defense Of $6 Billion Payment To Iran Isn’t So Simple, Experts Say

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The Biden administration has defended its decision to send a $6 billion transfer to Iran by arguing that it can only be used for humanitarian aid, but the argument ignores the fact it frees up unrestricted funds the country already had on hand that it could now use to sponsor terrorism, according to lawmakers and foreign policy experts.

The Biden administration cut a deal with Iran in September to transfer $6 billion in previously frozen assets in exchange for five American prisoners. Though administration officials insist that funds are strictly for “humanitarian purposes,” it could also free up $6 billion in unrestricted funds for Iran to use to sponsor terrorist groups like Hamas, which killed hundreds of Israelis in attacks over the weekend. (RELATED: Blinken Deletes Post Calling For ‘Cease-Fire’ Between Hamas And Israel)

“Let’s be clear: the deal to bring U.S. citizens home from Iran has nothing to do with the horrific attack on Israel,” State Department spokesman Matthew Miller said on Saturday as numerous analysts and GOP lawmakers blamed the Biden administration for helping to fund Hamas’s historic war. “Not a penny has been spent, and when it is, it can only go for humanitarian needs like food and medicine. Anything to the contrary is false.”

Miller’s statement, and other Biden administration officials’ statement, fails to take into account that the $6 billion in funds allows Iran to reallocate other funds that it could use to back terrorist operations, experts said. The notion that Iran would not use freed-up funds to sponsor groups like Hamas is “ridiculous,” according to Gabriel Noronha, former Special Advisor for the State Department.

“Iran normally has to allocate its limited foreign exchange reserves for food/medicine months in advance to facilitate trade flows. Not anymore,” Noronha said on X. “Iran can now devote $6 billion of its unrestricted funds toward financial, operational, and logistical support for terror proxies including Hamas.”

“The $6 billion is fully fungible within the Iranian system,” Noronha said to the DCNF. “This is like getting $6 billion in a savings account that fully frees up money to be used as checking accounts and credit cards.”

The Wall Street Journal reported that Iran helped Hamas plan the attacks weeks in advance, and gave the go-ahead for the assault last week; however, Secretary of State Antony Blinken said on Sunday that the Biden administration has “not yet seen evidence” of that being the case. Israeli intelligence did not initially suspect Iranian involvement, but now has growing concerns that it played a role in the attacks, even indirectly, according to Politico.

“Just because you don’t have that evidence doesn’t necessarily mean Iran isn’t behind it,” Maj. Nir Dinar, a spokesperson for the Israel Defense Forces, told Politico on Monday.

Blinken said that Iran has historically “used and focused its funds on supporting terrorism, on supporting groups like Hamas,” during an NBC News interview on Sunday.

“The $6 billion payment freed up huge reserves to ensure that Iran could continue this support,” Noronha said on X.

Victoria Coates, Vice President of the Kathryn and Shelby Cullom Davis Institute for National Security and Foreign Policy at The Heritage Foundation, told the DCNF that while she doesn’t believe the freed-up funds were used by Hamas in their recent assault on Israel, it likely gave them the confidence to speed up the timeline for the attacks, knowing they’ll have access to funding for the future.

“Certainly it emboldened the Iranians to know they had an additional $6 billion in the bank so may have hastened the attack, but this will well into the planning phase before the transfer,” Coates told the DCNF. “What funded this attack was the tens of billions in oil revenues Iran has raked in since Biden stopped imposing the sanctions two years ago.”

“So the $6 billion ransom will almost certainly fund the next attack, but I don’t see it as directly responsible for this one,” Coates said.

The $6 billion was transferred on the condition that Iran would free five American prisoners. However, the recent actions of Hamas demonstrate that Iran believes it is now profitable to take more hostages in the hopes of another payout, as the terrorist group has kidnapped over 100 Israelis since the attacks began on Saturday, according to Jonathan Schanzer, an Iran expert at the Foundation for Defense of Democracies.

“Whether the cash has been transferred to Iran or it hasn’t, the message the United States sent to Iran was this: Hostage diplomacy is fair game,” Schanzer said, according to the Washington Free Beacon. “Hamas appears to have taken that message to heart. The end result is that five Americans have been sent home, but more than 100 Israelis are now held in Gaza.”

Iranian President Ebrahim Raisi stated in September that Tehran has the “authority” to use the $6 billion “wherever [they] need it.”

“Money is fungible and regime officials calculate for it, including for shoring up their foreign exchange reserve,” said Republican Texas Sen. Ted Cruz.

The White House and State Department did not immediately respond to a request for comment.

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