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Iran Central Bank Chief Says Luxembourg Lifts Freeze On $1.6 Billion

Abdolnasser Hemmati , Governor of the Central Bank of Iran talking with reporters. FILE PHOTO
Abdolnasser Hemmati , Governor of the Central Bank of Iran talking with reporters. FILE PHOTO

Central Bank of Iran (CBI) Governor says Luxembourg has unfrozen 1.6 billion dollars of Iran's assets despite an attempt by victims of terror to get the funds as compensation.

Abdolnasser Hemmati said on Wednesday, April 8, Tehran thwarted Washington's efforts to seize and transfer the CBI's funds out of Europe.

However, the case mentioned by Hemmati is related to a private lawsuit against the Islamic Republic.

In 2012, a New York court found there was evidence showing that the Islamic Republic provided "material support and resources to al Qaida for acts of terrorism". The extremist group had carried out the September 11 hijacked plane attacks in New York and Washington.

The court awarded the plaintiffs, all private citizens of the United States, damages of over $7 billion.

Based on the 2nd Circuit's ruling, families of the victims were seeking access to $1.6 billion of Iranian funds in Luxembourg, which were frozen as part of international sanctions over Tehran's controversial nuclear program.

When in 2016 international sanctions against Iran ended, the money in Luxembourg remained frozen pending litigation. Meanwhile, the Islamic Republic attorneys appealed against the ruling of the American court.

On January 13, the plaintiffs' hopes highly diminished when the Supreme Court repealed the decision by a federal appeals court in New York and returned the case to the 2nd U.S. Circuit Court of Appeals.

CBI attorneys told the Supreme Court that the federal appeals court ruling in New York would put the United States in violation of international law and threatened "disastrous consequences" for American foreign relations.

Later, the Luxembourg Times reported on March 27 that a Luxembourg court rejected a U.S. court request to compensate victims of the Twin Tower attacks by seizing assets from Iran.

"The rule of the U.S. court used to repeal the immunity of the defendants, namely the Islamic Republic of Iran and the Central Bank of Iran, is not compatible with international law," it added.

In the meantime, Hemmati has stopped short of saying whether the released funds were transferred to Iran or not. Given current U.S. sanctions on Iran’s banking, the funds most probably will remain in Europe and theoretically can be used for food or humanitarian purchases.