Iran’s Funding of U.S. Hostage Captors Told

Iran financed the confinement and upkeep of the American hostages who were held in Lebanon and also paid their captors $1 million to $2 million for each hostage released, according to Bush Administration officials who have studied the long ordeal and eventual liberation of the captive Americans.

U.S. officials interviewed since last month’s release of Terry A. Anderson, the last of the American hostages, said that nearly all the key negotiations about the American captives took place in Tehran, rather than Lebanon. And the officials added that advance word of impending releases came from the Iranian Foreign Ministry through diplomatic channels several days ahead of each recent release.

The officials said that Lebanese fundamentalists who directed the incarceration of the hostages were provided with Iranian travel documents and conferred frequently with Iranian diplomats.

Moreover, officials said regular payments to the groups holding the Americans and other Western hostages were traced by U.S. intelligence to official Iranian sources. The $1 million to $2 million paid to the hostage-holders in connection with each release was in addition to the regular payments and was described by one official as a “per capita” award for hostage termination.

Asked why Iran had to pay the captors for the releases if it exerted overall control anyway, a senior U.S. official said the Iranians “want to keep these people happy, quiet and on their side. They have long-term investments in Lebanon. They are there for the long haul.” Officials declined to give details of Iran’s financial involvement with the hostage-keepers because they said the information is based on highly classified intelligence reports.

“The road to the hostages ran through Tehran,” said an Administration official who for the past six years led a U.S. unit that concentrated on the long-running issue. He and others expressed the belief that the holding of American hostages in Lebanon was terminated not because of inducements or deals--as was attempted during the Ronald Reagan Administration--but because the hostages had outlived any possible usefulness with the passage of time, the realignment of East-West relations and the unwillingness of Washington to bargain.

These officials said Iran concluded that the continued holding of the hostages was a serious detriment to the Islamic republic’s efforts to win economic access to the West at a time when the Soviet alternative had collapsed. The hostages also had become more of a burden than an asset to the fundamentalist Shiite Muslim groups in Lebanon that seized and held them for years.

Iranian officials had often tied their cooperation in obtaining the release of the hostages in Lebanon to the return of Iranian assets impounded by the United States in an earlier hostage episode--the 1979 seizure of the U.S. Embassy in Tehran.

The Bush Administration, recognizing Iran’s interest, shifted gears in 1989 to speed action in the U.S.-Iran Claims Tribunal at The Hague. In a much-noted action Nov. 29, amid the final releases of U.S. hostages, the United States announced payment of $278 million in compensation for seized Iranian military equipment. However, U.S. officials have provided an account of U.S.-Iran negotiations showing that the coincidence of timing was due to Tehran, not Washington.

While Americans were still being held in chains in Lebanon, Washington officials had been willing to discuss Iran’s behind-the-scenes role only in the most guarded terms. In recent weeks, officials disclosed new details and assessments of the Iran connection, some of which were based on developments in the end-game negotiations.

“Iran had a substantial amount of authority in almost all cases,” said a senior U.S. official with access to the complete file on the hostages. Another senior official said, “We used to spend endless hours debating here the degree of Iranian control. The evidence now is that control was 99.9%.”

A third senior official who carefully studied all information about the hostages said Iranian control over the hostages may have been less clear-cut than the others believe. He said Iran had “about as much control as you do over your 16-year-old son,” which is to say the levers of power are there to be used but the realistic question is, “How much pressure are you willing to bring to the table?”

Iran’s ambassador to the United Nations, Kamal Kharazi--one of a dozen high-ranking diplomats and officials interviewed in Washington and the United Nations for this story--said reports that Iran had control over the captive Americans and other Western hostages in Lebanon are “baseless.”

“Those who have such imaginations don’t understand Lebanon, the Lebanese people and these (hostage-holding) groups,” the ambassador added. If there was an Iranian influence, Kharazi said, it was “spiritual influence,” which was exerted through “different channels of communication” to encourage Lebanese groups to release their hostages. Kharazi said that, to his knowledge, money was not a factor in either the seizure or the release of the hostages.

Iran’s role in the original capture of American and other Western hostages in Lebanon is not clear. But experts said the seizure of the U.S. Embassy in Tehran in November, 1979, and the holding of U.S. diplomats for 444 days at the end of the Jimmy Carter Administration, convinced some Iranian factions as well as their sympathizers in Lebanon that hostage-holding was an effective form of revolutionary warfare, with an impressive political payoff as well as potential economic gain.

In Lebanon, the hostage-takers were identified by U.S. officials as clandestine elements of Hezbollah, an umbrella organization of Lebanese Shiites that is inspired and aided by Iran and which also has religious, social and political functions.

Another important governmental player was Syria, which held military sway over much of Lebanon and, therefore, was in a position to pressure the hostage-holders. Although Syrian intelligence conceded that it knew at times where the hostages were, officials in Damascus indicated to then-U.S. Ambassador Edward P. Djerejian that they were reluctant to stage a raid because hostages could be killed.