£400million Iran ‘debt’ linked to Nazanin Zaghari-Ratcliffe case

£400million blow to Nazanin Zaghari-Ratcliffe: Ministry of Defence and Foreign Office are at war over Iran ‘debt’ thought to be linked to case of jailed mum

  • The MoD is said to have rejected pleas to hand over a £400m ‘debt’ to Iran 
  • Foreign Secretary Jeremy Hunt yesterday likened the debt to ‘ransom money’ 
  • It is feared British-Iranian mother-of-one Nazanin is being held as a ‘bargaining chip’ in the decades old dispute

The Ministry of Defence and the Foreign Office are at loggerheads over a £400m ‘debt’ to Iran linked to the case of jailed Nazanin Zaghari-Ratcliffe, it was reported last night.

The MoD is said to have rejected pleas to hand over the money because of fears it would end up in the hands of the Iranian Revolutionary Guards Corps.

It has long been feared that British-Iranian mother-of-one Nazanin is being held as a ‘bargaining chip’ in the decades old dispute.

Nazanin Zaghari-Ratcliffe, pictured with her daughter Gabriella, is being denied medical treatment for a mystery illness, her husband claims

The claim came as Foreign Secretary Jeremy Hunt yesterday likened the debt to ‘ransom money’ for the woman from Hampstead adding that the government faced a ‘conundrum’.

Sources claim there have been heated clashes over the debt between the Foreign Office – which is believed to have been pushing for a resolution to help secure the mother’s release – and the Ministry of Defence.

Successive defence secretaries Sir Michael Fallon and Gavin Williamson are understood to have opposed payment claiming it will fund the country’s ‘malign military agenda in Yemen, Syria and Lebanon’, The Guardian reported.

The IRGC – the Iranian government’s military department – has been declared a terrorist organisation by the US, but not the UK.

Foreign Secretary Jeremy Hunt granted Mrs Zaghari-Ratcliffe diplomatic protection last month

The long-running controversy over the money dates back to a 1970s arms deal, when the Shah of Iran ordered and paid for 1,750 Chieftain tanks and support vehicles from a firm owned by the Ministry of Defence.

But the deal was halted after the Shah was deposed in 1979, and Britain kept the money.

An international court ordered the UK to reimburse Tehran, but international sanctions mean Britain has yet to do so with the money being held by the High Court.

The UK and Iran – both of which have previously denied any link between the two issues – put their legal arguments over the payment to a high court hearing last week with a ruling due soon.

According to reports, Iranian regime hardliners have said they expect the deal to be settled as part of a list of demands before freeing Mrs Zaghari-Ratcliffe.

The 41-year-old has been held in Tehran since April 2016 after being jailed for five years over trumped up spying charges.

Her husband Richard Ratcliffe said the debt case ‘matters to us since we have been told explicitly that we are linked to this court case. It feels like we are a very explicit bargaining chip that is being used’.

Richard Ratcliffe, husband of Nazanin Zaghari Ratcliffe, who is detained in Iran, said his wife’s symptoms have steadily worsened since she was recalled to Tehran’s notorious Evin prison after a temporary three-day release in August

A source told the Guardian that records show there had been heated exchanges between the Foreign Office and the MoD about the controversial debt.

Some were said to have argued that the government lost the 2001 international arbitration case and owed the money so should therefore show a willingness to work with Iran.

But the MoD said even if an agreement on debt was reached the money could not be handed to Iran’s military sales arm because the body is under EU sanctions.

It was also argued the money could be paid in a way that avoids current sanctions – a case rejected by government lawyers.

Legal wrangling over the debt has been shrouded in secrecy for decades – but this was lifted after the Sunday Times won a court order allowing arguments in the case to be published.

Foreign secretary Jeremy Hunt yesterday claimed that there had never been a government policy to keep the court hearing secret and it was just normal legal practice in arbitration cases.

Welcoming the move to make it public on Radio 4, he said that Mrs Zaghari-Ratcliffe was being used as a pawn in a wider diplomatic dispute between Iran and the UK and likened the debt to ‘ransom money’.

‘The problem is if you pay ransom money to someone who is a hostage then all that happens is you might get that hostage out, but the next time they want something they’ll just take someone else hostage. That is the conundrum we have.’

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