Project Refund: An impressive accomplishment


By Bill Taylor

It seems to me that all the recent whoop-de-do about that $400 million dollar cash payment to Iran kinda makes a body realize what an impressive accomplishment this was.

After all, putting together such a undertaking (which I have dubbed “Project Refund”) likely required lots of planning and cooperation among a bunch of US agencies as well as some foreign governments and organizations. We probably will never get the whole story of who did what, how they did it, and other details, but that’s okay. We can still appreciate how our government was able to pull this thing off.

The gist of the matter is that while the Shah was still in power Iran ordered military equipment from the U S and made a down payment of $400 million. The revolution in Iran led to our not delivering the equipment and to the disruption of normal diplomatic relations resulting in the $400 million not being returned. Iran sued and the world court determined we had to refund that money. There were several difficulties to deal with in responding to this requirement with the primary one being that payment be made in cash so we couldn’t simply write a check or use a wire transfer.

In addition, restrictions on payments in dollars prohibited our using U S currency and so we had to use hard currency from other countries. That meant using Euros, English pounds, Swiss francs, Japanese yen and such.

Furthermore we had to deliver the cash to Iran. Quite a problem, right? Getting a large amount of cash together isn’t like going to your local bank and making a withdrawal from your account. Such a transaction raises red flags in financial and banking circles. (Some folks have tried to draw large sums of their own money from their personal accounts and have lived to regret it but that’s another story.)

So what could we do to meet this obligation? The cash most likely came from money we have in foreign countries in “counterpart funds” – meaning local currency of a country that has been accumulated by the sale of commodities or foreign exchange and received as payment. This money is kept in the country where it is received and is often considered a contingency fund, that is, a fund for emergencies or unexpected expenses. It is “off budget” in that it not part of the congressionally approved budget. It is, however, available to the Administration for expenditures – almost like a “slush” fund. Still, when you get right down to it, $400 million is a lot of money to be somehow withdrawn in cash from various places around the world and transferred to a central location.

Large amounts of money are almost always moved these days by electronic means – except for those folks who are into drug or arms dealing – so moving large amounts of cash is not an easy task. Kinda figure the money was likely moved in diplomatic pouches to avoid problems with prying eyes. Somehow enough cash was located and moved to a central location for inventorying and processing. The specific composition of this treasure trove hasn’t been revealed as far as I know but the chore of counting, figuring the exchange rate, and packaging “several pallet loads” of different currencies must have been a monumental task.

Once the cash was inventoried and packaged there was still the problem of getting the money to Iran. Delivery by air was the obvious choice, but the sheer bulk of the money would require a fairly large airplane. Fed Ex likely wasn’t an option nor was any of our military cargo airplanes – so what news reports described as an “unmarked” aircraft was used. There is some speculation that a CIA airplane was employed, but there was one report that an Air France passenger airliner with the seats and external markings removed was selected.

Complicating matters a bit more was the challenge of arranging the flight of an unmarked airplane through the heavily monitored and controlled airspace from takeoff all the way to Iran and back. I imagine that took a bit of coordination and international cooperation to make happen. Wonder if the aircrew knew what they were transporting. That’s a lot of loot.

Another point about this project was that the delivery was to be made at a specified time – essentially coincident with the release of several U S hostages being held by Iran. And don’t forget this entire operation was done quietly with no publicity until after the hostages were safe.

Yep, all-in-all Project Refund was an impressive achievement and we have to give credit where credit is due – even if we don’t know who the players were or exactly how they did it.. At least that’s how it seems to me.

By Bill Taylor

Bill Taylor, a Greene County Daily columnist and area resident, may be contacted at [email protected].

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