For Former Embassy Hostages, a Special Interest in Iran Talks

WASHINGTON - When the United States agreed on Monday to extend the nuclear negotiations with Iran for another seven months, it was met with immediate protest from Republicans and some Democrats in Congress, as well as from hard-liners in Iran's Parliament.

But it also raised alarms with another group that has a long, anguished history with Iran: the Americans held captive in the United States Embassy in Tehran for 444 days, from 1979 to 1981.

As part of the extension, Iran will continue to receive $700 million a month in funds that were frozen under Western sanctions. That is money the surviving hostages, and their families, believe could be used as a financial settlement for their captivity - a period in which they were interrogated, beaten and subjected to mock executions.

The former hostages - 39 of the original 52 are still alive - have waged a fruitless campaign for restitution because of a diplomatic agreement that President Jimmy Carter signed to obtain their release, which granted Iran immunity from legal claims in the United States, in addition to freeing up nearly $8 billion in Iranian assets.

With Iran entering serious talks with the West over its nuclear program last year, the hostages believed they finally stood a good chance to extract compensation. So the prospect of sending back another $4.9 billion in Iranian funds over the next seven months troubles them, particularly since they are an aging group, with a dwindling chance to be compensated for an ordeal more than three decades ago.

'My initial thinking when they went into this nuclear negotiation with Iran was that America had a pretty good hand,' said David M. Roeder, a retired Air Force colonel who was an assistant attaché on Nov. 4, 1979, when a mob of protesters overran the embassy. 'What happened this week raises a serious question in my mind.'

Colonel Roeder said he hoped the White House or Congress would take action, either through an executive order or legislation, to help the hostages gain access to Iranian funds. A Senate bill introduced last year would compensate the victims and their families from a fund financed by levying a temporary surcharge on companies or individuals that do business with Iran in violation of American sanctions.

The trouble is, federal courts have consistently refused to overturn the deal signed by Mr. Carter, known as the Algiers Accords. Because of that, the Tehran hostages have been denied the damages awarded to other victims of Iranian state terrorism, like the 63 people killed in the April 1983 bombing of the American Embassy in Beirut, Lebanon.

'What the American people don't really understand is that even though we regained our freedom the day Ronald Reagan was inaugurated, that was not the end of the hostage crisis,' Colonel Roeder said.

Several of his fellow hostages suffered psychological trauma in the years after their captivity, he said. One recently committed suicide. Families have broken apart, and with advancing age, the older members of the group are experiencing health problems.

Senator Richard Blumenthal, a Connecticut Democrat who co-sponsored the Senate bill along with a Republican colleague, Senator Johnny Isakson of Georgia, said he believed the decision to extend negotiations with Iran - and to give Iran $700 million a month in sanctions relief - should put a spotlight on the plight of the former hostages.

'As important as the amount of money is the amount of will or determination to do the right thing here,' he said. 'I'm very hopeful that we can rejoin the battle for fairness to the victims of one of the most oppressive chapters in U.S.-Iran relations.'

The State Department said it was obligated to honor the legal immunity in the Algiers Accords, according to a senior official, but was working with Congress to find other ways to compensate the hostages. The official, who spoke on the condition of anonymity because of the sensitivity of the matter, said that the funds being paid to Iran as part of the nuclear talks came from restricted bank accounts overseas and 'do not in any way impact on any attempts to compensate the former hostages.'

Tom Lankford, a lawyer in Alexandria, Va., for the ex-hostages and their families, said: 'We've had supportive words from Secretary Kerry and his staff. What we're after is exactly what other victims of state-sponsored terrorism are entitled to.'

In similar cases, Mr. Lankford said, courts have mandated that former hostages receive $10,000 for each day of their captivity; in cases where the victim is dead, spouses and children are entitled to $5,000 per day. That works out to damages of $4.4 million per hostage, or roughly $450 million for all the hostages.

Theoretically, there is no shortage of Iranian money to pay compensation. The Iranian government has $100 billion to $120 billion in foreign-exchange reserves in accounts outside the country, according to Mark Dubowitz, an expert in sanctions who is the executive director of the Foundation for Defense of Democracies.

The bulk of that money is oil revenue held in escrow accounts by major trading partners of Iran, including China and Japan, Mr. Dubowitz said. Only about 10 percent of it is in frozen accounts that include cash and other assets, like Manhattan real estate. Since the United States and its partners agreed last November to ease sanctions in return for a freeze in Iran's nuclear program, they have released $7.7 billion to Iran.

Lawyers involved in other terrorism cases said they were hopeful that if Iran reached a nuclear deal with the West, the two sides could resolve claims stemming from terrorism cases, as the United States did with Libya when they re-established diplomatic relations.

'If and when they do reach an agreement on the nuclear nonproliferation issue, there must be at some point an agreement between the U.S. and Iran similar to the one the U.S. did with Libya,' said Stuart H. Newberger, a lawyer who won a judgment against Iran on behalf of victims of the Beirut embassy bombing.