Happy ending for an Iranian Account held at Clearstream, Luxembourg?

My Orchids. Cattleya "Sheherazade" Photo ET

Happy ending for an Iranian Account of USD 1.6 billion, held at Clearstream, Luxembourg?

In 1983 Iranian backed terrorists blew up a US Marines base in Beirut, killing 241 American servicemen, and injuring many. Of the injured, 13 died in the days after the attack. 58 French soldiers were also killed in a second attack.

Under the “Terrorism Insurance Program established under the Terrorism Risk Insurance Act of 2002”, families of those killed or injured filed civil law suits against Iran. Victims were awarded 2.65 billion from Iran as the sponsor of the attacks carried out by Hezbollah. 

In 2013 already, Clearstream turned over USD 1.8 billion belonging to Iranian Bank Markazi. Another USD 1.6 billion owned by Banca UBAE were the object of this week’s ruling by District Judge Katherine Forrester in New York. Her conclusions were that Clearstream’s 2013 settlement released it from new claims in this matter. She also dismissed three other classical arguments, that would put a case into US jurisdiction: Clearstream has offices in the US, accounts were held in USD, and funds had transited through JP Morgan. Those are indeed top considerations when in administrative sanctions, foreign financial institutions are submitted to US “long-arm” policies. An early example for this would have been in the 1990ies Bank Leu in Luxembourg, convicted of money laundering, though it had no presence in the US, no accounts, but cashed drug related checks in USD, transactions that hit the jurisdiction through correspondent banks.

The victims’ families have vowed to appeal. Based on earlier long-arm strategies, it might be successful. However somehow time is of the essence for them. Under international sanctions against Iran, Clearstream had to freeze the account. At this moment the account remains in Clearstream’s custody. However, this might change in a relatively near future, as the US has deployed vast efforts and possibly concessions to Iranians to achieve an anti-proliferation agreement on its nuclear development program. Lifting sanctions, thereby un-freezing the Iranian foreign accounts could become part of a package deal. 

Starbucks Luxembourg will be so much more!

My Orchids. Phalaenopsis "Latte with Sprinkles". 
Photo Got Milk?

Starbucks Luxembourg will be so much more!

Officially, Luxembourg’s Prime Minister Xavier Bettel will visit the West Coast of the US and promote “DigitalLuxembourg”.

That’s for the official story. Everyone knows that software engineers cannot function without Starbucks coffee. This blog though, I hope renowned for its in depth contributions to the public’s information, found at least some trace of the unspoken collateral diplomacy going on. Patti Payne, may I quote here your article from February 12th,2015 (Patti is a Columnist at the Puget Sound Business Journal):

“Philanthropist Cynthia Stroum, a former U.S. Ambassador to Luxembourg who was appointed by Barack Obama in 2009, will host a dinner for the Prime Minister of Luxembourg Xavier Bettel and his official delegation on Monday at Seattle's Wild Ginger.

Prime Minister Bettel will be joined by Seattle Mayor Ed Murray as well as two local business leaders. Bettel was Mayor of Luxembourg before becoming the prime minister.

"I continue to have great relationships in Luxembourg," says Stroum, who stepped down from the job in 2011 amid reports of a confrontational management style by some staffers, "and continue making connections and links between the two countries."

Of course we in Luxembourg remember Cynthia Stroum and her incomprehensible sudden departure from her post as Ambassador. We have looked with incredulity at a so-called investigation by the Inspector General, taking issue with her management style. And not to forget the queen size mattress, and 24 bottles of wine. I came to the conclusion that most countries subjecting their Ambassadors to the same criteria would run out of Ambassadors.

That’s how things go. When a President rewards his supporters with a diplomatic post, and then drafts a Secretary of State who was a former opponent for political calculation, somehow that might backfire on the early supporters. In any case, Luxembourg didn’t seem to make a great case out of the episode. They still call her Madam over there.

The parallel diplomacy with Luxembourg maintained by Cynthia Stroum at least document her excellent contacts there. It is a nice occasion to finally close another project she had in her mind during her official tenure: Starbucks Luxembourg. Ms. Stroum as a venture capitalist has been an early investor into the Seattle based company. The Luxembourg project will be a success, and much more: success is the sweetest revenge, if one is needed.

I don’t know though if the moment is ripe to ask Mr. Bettel for a special tax ruling. Unless it is over tasting Seattle Fran’s irresistible smoked salt caramels in chocolate!

Starbucks (left) in artist's rendering at Centre Hamilius. Photo Codic