White House Defends $10 Billion Sanctions Waiver to Iran Following Attack

Latest Developments

The White House on April 15 defended Iran sanctions waivers it last extended in March, giving Iran access to $10 billion in funds. National Security Council spokesperson John Kirby told reporters none of the unfrozen funds go directly to Iran’s Islamic Revolutionary Guard Corps (IRGC) or supreme leader, Ayatollah Ali Khamenei. A day earlier, on Fox News Sunday, Kirby insisted that the funds, which the administration first unfroze in July, did not contribute to Iran’s use of its drones and missiles against Israel or its proliferation of weapons to its terrorist proxies. Kirby said that the funds were only “for humanitarian goods.”

Kirby’s defense comes less than a week after the Biden administration admitted that any funds Iran receives go to supporting violent activity before the humanitarian needs of its people. Opponents of the waiver note that money is fungible and that the waiver will allow the regime to free up funds to continue arming its anti-U.S. and anti-Israel proxies.

Expert Analysis

“Money is fungible. This money is budget support to the regime in Tehran, plain and simple. The relevant question is not whether this is sanctions relief — it is — but rather why the White House is so desperate to keep it going after October 7, three dead Americans in Jordan, and now Saturday night’s attack on Israel.” — Richard Goldberg, FDD Senior Advisor

“Joe Biden is Ali Khamenei’s Iron Dome. By not enforcing the sanctions and by offering Tehran unprecedented access to its currency reserve and export revenue, Biden is funding Ali Khamenei’s oppression at home and aggression abroad while he pressures U.S. allies not to retaliate against Tehran.” — Saeed Ghasseminejad, FDD Senior Iran and Financial Economics Advisor

Every Dollar Goes to ‘Violent Activity’

On April 9, Deputy Treasury Secretary Wally Adeyemo testified in Congress about the Islamic Republic’s spending. “What we’ve seen time and time from the Iranian regime is that they fail to feed their people, and they put the IRGC first,” Adeyemo said. “Any dollar they have will go towards violent activity before they deal with their people.” He added that “almost none of the humanitarian money has been used for humanitarian purposes because they don’t care about getting drugs and food for their people.” Yet Adeyemo claimed that the money covered by the waiver will never go directly to Iran.

Sanction Waivers Different Than Those of Trump Administration

The United States first issued the sanctions waiver in July, giving Iran access to funds that were in escrow in Iraq. Since then, the Biden administration has reissued the waivers in November and March — approximately a month and a half after Iran-backed Iraqi militias killed three U.S. servicemembers in Jordan. The State Department claims that the waiver allows Baghdad to continue purchasing electricity from Iran.

From 2018 to 2023, the State Department issued temporary sanctions waivers that allowed Iraq to import electricity from Iran on the condition that all payments remained in an escrow account in Baghdad, thereby denying Iran access to the revenue. Last summer, the Biden administration changed that waiver to allow Iraq to transfer $10 billion to Iran and to deposit future payments into Iranian bank accounts in Oman. The new policy also allowed Iran to convert the money from Iraqi dinars to euros and then process euro-based transactions for imports and debt payments out of those accounts.

Related Analysis

“U.S. Grants Iran Sanctions Waiver Worth $10 Billion,” FDD Flash Brief

“Iran Receives Access to $10 Billion Thanks to U.S. Sanctions Waiver,” FDD Flash Brief

“Iraq to Pay Iran with Oil for Billions of Dollars in Debt,” FDD Flash Brief