Free Beacon Managing Editor Aaron MacLean on Tuesday discussed U.S. efforts to keep its funding from ending up in the wrong hands.
The U.S. temporarily halted cash transfers to the Iraqi central bank over the summer because it suspected the money was being funneled to Islamic State (IS) and Iran.
MacLean said that the funding shutoff was illustrative of the challenges the U.S. faces finding reliable partners in Iraq.
"The most remarkable part of the story is that, month after month, as the U.S. government is trying to do something about this and get Iraqi help, it turns out it takes shutting down the flow of cash over the summer to get their participation in stopping it," MacLean said.
MacLean noted the irony that Iran was siphoning U.S. dollars out of Iraq while it was negotiating a nuclear deal with the U.S. and its partners. Iran will be further enriched through the nuclear deal, which gives it access to billions in business and previously-frozen assets.
Transcript below:
DEIRDRE BOLTON: The U.S. is cutting cash to Iraq on worries it is getting into the wrong hands. Welcome to Risk and Reward, I'm Deirdre Bolton. The treasury department shutting down the flow of billions of dollars to Iraq's central bank. Concerns mounting the money was ending up at sanctioned Iranian banks and being funneled to ISIS militants. Retired Captain Aaron MacLean is with me now. He says the U.S. should worry less about the money going into Iraq, more about renegotiating our agreement with Iran. Captain, thank you so much for your time. These two are not mutually exclusive. Why not focus on the money trail? It seems like something that is more easily controllable now.
AARON MACLEAN: Well, look, it's really hard to focus on that money trail when we seem to lack Iraqi partners who want to do the right thing and keep this money out of ISIS and Iranian hands. But this is a remarkable story. For over a year now, the U.S. government has been leveling some very serious allegations behind closed doors that the Iraqi central bank, when it receives U.S. cash under a legitimate deal, then turns that cash over to other parties who in turn are apparently providing it to ISIS on the one hand and these Iranian banks on the other hand. The most remarkable part of the story is that month after month as the U.S. government is trying to do something about this and get Iraqi help, it turns out it takes shutting down the flow of cash over the summer to get their participation in stopping it.
BOLTON: All right. Now, as far as the Iran framework that we agreed to—the U.S. and five other nations—, experts tell us that that ship has sailed until Iran breaks a key condition. So what do you see as a possible action point?
MACLEAN: Well, yeah, that ship has sailed for sure, but it's good to reflect on the irony about the cash flow: this summer, as the nuclear deal was being negotiated and finalized, in fact, behind our backs these Iranian banks were going behind American backs and getting U.S. dollars through the Iraqi government really only a couple of steps through the Treasury, even as these deals were being negotiated. These are our partners.
BOLTON: All right, retired captain, glad to have you with us.