M I D - E A S T R E A L I T I E S - LIE OF THE WEEK
For additional information: http://MiddleEast.OrgTHE SECRET PRICE OF TERRORISM:
CASH FOR NO QUESTIONS
January 1981. After 444 Days the 52 American Hostages In Iran are Hastily Released. Hours Earlier, the US Government had Paid a Secret (and Never Previously Revealed) $150 Million Ransom. They Have Been Trading With Terrorists Ever Since. Do the Deals Work?
Luxembourg: obsessively discreet, conservative and low-profile -- ideal for the transaction that the Americans had in mind. Their troops had liberated it at the end of the Second World War and their spies had gone on to use it as a clearing house for covert financial operations. Slowly and without fanfare, US government agencies had spent the Forties and Fifties moving their money around the hundreds of banks and finance houses of the tiny Grand Duchy. They became the cream of the clientele and got what they wanted most -- secrecy.
As he sat in his office in one of the city's financial giants, Jean Berthoud had reason to reflect on this ultra-special transatlantic relationship, as he carried out an order, telexed from Washington. The date was 18 January 1981 -- three days before the release of US hostages from their embassy in Tehran. (The 52 American hostages flew from Iran to Wiesbaden in West Germany after 444 days of captivity, minutes after Ronald Reagan was sworn in as fortieth President of the United States.) As part of the deal, the Americans were unfreezing Iranian assets in the world's largest-ever transfer of private funds. But Berthoud had been given a different task. He was to pay over -- in freely convertible bearer bonds -- an $8 million ransom that has never before come to light.
Set against the billions that were legitimately in transit, this was indeed a tiny sum. But it ended up sending a very potent signal: under extreme conditions the US would deal with terrorists and hostage-takers and even buy them off. In years to come, that message resounded around the world's darkest corridors, received and understood by extremists of every conceivable stripe. A dangerous precedent has been set.
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