Administration waived $10-million fine for Iranian national involved in hostage deal

The deal with Iran that freed five American hostages two weeks ago contained a secret sweetener that facilitated the release of an Iranian convicted of violating the sanctions regime.

A $10-million judgment against Nader Modanlo, an Iranian-born aerospace engineer, was dropped as part of the deal to release the Americans held by Iran.  The money was a fee collected by Modanlo for a deal he brokered between the Russians and Iranians to receive the technology that allowed the latter to launch their first satellite.


A Washington-based spokesman for the Justice Department declined to comment on discussions over the $10 million, which the jury found that Modanlo was paid to help Iran launch its first satellite in 2005. Modanlo says the money was a loan from a Swiss company for a telecoms deal.

In the prisoner swap, five Americans held in Iran were released at the same time as seven Iranians charged or imprisoned in the United States were granted pardons or had their sentences commuted. The deal accompanied the Jan. 16 implementation of a landmark agreement that curbs Iran's nuclear program in exchange for sanctions relief.

Even after receiving the improved offer on Friday, Jan. 15, Modanlo said he didn't budge at first. He wanted a chance to clear his name in court, he says.

"I was mostly disappointed that I have to give up my right to appeal," Modanlo, 55, told Reuters in one of his first interviews since being released.

"If they believe in their justice system why would they deprive me of it? Let them prove me wrong."

As part of their clemency agreements, all of the Iranians had to renounce any claims against the U.S. government. All but one had been accused of violating the economic sanctions the United States has enforced against Iran for decades.

Modanlo's reluctance to accept Obama's offer became an eleventh-hour complication to an otherwise carefully staged deal with Iran that had been negotiated in secret for months by U.S. Secretary of State John Kerry and his Iranian counterpart.

He only agreed to accept the clemency offer on Saturday, Jan. 16 as the clock ticked toward what U.S. officials said was the final deadline, according to Modanlo and U.S. officials.

He was freed the next day from a federal prison near Richmond, Virginia. The release marked an abrupt conclusion to his case after a sprawling, decade-long investigation into Modanlo's role in brokering Iran's access to space technology. U.S. federal agents had pursued evidence from the suburbs of Washington to Switzerland and Russia.

Modanlo was serving the longest sentence of any of the seven Iranians and had the most extensive, established connections to Iran's government.

The amount of money is unimportant.  What matters is what Iran was able to extort from this administration to get our people back.  We already knew that we included a $150-million interest payment on some returned assets to secure the release – a ransom that the administration refuses to acknowledge as such. 

There is absolutely no deterrence whatsoever in this deal to make Iran think twice about taking more Americans hostage.  In fact, they'd be fools not to.  As long as the administration continues to coddle, to grovel, and to surrender to Iranian threats and extortion, no American who travels to Iran will be safe.

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