United States Attorney for the Southern District of New York, Jay Clayton, announced that the United States has entered into a settlement resolving a 17-year forfeiture litigation that will result in the payment of approximately $318 million to hundreds of victims of Iranian state-sponsored terrorism.
In 2008, the United States commenced a forfeiture action that exposed an Iranian government-owned bank’s secret interest in 650 Fifth Avenue, a 36-story commercial and office tower located in the heart of Manhattan. Following the filing of the forfeiture complaint, hundreds of victims of Iranian government-sponsored terrorism filed claims and initiated separate litigation to enforce judgments obtained against the Government of Iran. After more than 17 years of complex litigation, all remaining parties to the related actions have entered into a global settlement that will result in a multi-hundred-million-dollar payment to these long-suffering victims, including victims and family members of the 1984 bombings of U.S. military facilities in Beirut, Lebanon; of the September 11, 2001 terrorist attacks in New York and Washington, D.C.; and Iranian proxy terrorist organizations’ attacks against civilians, including U.S. citizens, in Israel and elsewhere.
“Iran has sponsored terrorism for decades,” said U.S. Attorney Jay Clayton. “Since the inception of this litigation, the overriding goal of the Department of Justice has been to vindicate the rights of victims of the Government of Iran’s long-standing policy of supporting and promoting terror attacks across the world, including 9/11. This Office’s many years of determined litigation show our unrelenting commitment to victims’ rights and has led to this significant recovery. For nearly two decades, we pursued hidden Iranian government assets tied to a Manhattan skyscraper to ensure those funds would ultimately compensate victims of Iran-sponsored terrorism rather than terrorists and their enablers.”
According to the Complaint, Amended Complaint, public court filings, and other public litigation records:
The building at 650 Fifth Avenue (the “Building”) was originally constructed by a charitable foundation controlled by the former Shah of Iran, Mohammad Reza Pahlavi, prior to the Islamic Revolution that led to the installation of the current regime in Iran in 1979. The new regime took over control of the charitable foundation and created a partnership with Bank Melli Iran, an Iranian government-owned bank sanctioned by the U.S. government for its role in financing Iran’s weapons of mass destruction programs. Bank Melli Iran controlled its interest in the Building through front companies known as Assa that were established in the Isle of Man and in New York. The highest levels of the Iranian regime orchestrated this deceptive structure in the 1980s, including the Iranian Central Bank and the offices of the Prime Minister and the President of Iran.
After the imposition of broad sanctions against the Government of Iran by the United States in 1995, the owners of the Building concealed Bank Melli Iran’s ownership interest and facilitated the payment of tens of millions of dollars of income from the Building’s operations to Bank Melli through Assa.
In October 2008, this Office filed a forfeiture complaint against Bank Melli Iran’s interest in the Building. In November 2009, this Office filed an amended forfeiture complaint against the entire Building and other related properties. Following the filing of the complaint and the amended complaint, numerous groups of judgment creditors holding judgments against the Government of Iran for injuries resulting from state-sponsored terrorism filed claims and independent judgment-enforcement actions against Assa, the Building, and the Building’s owner.
In April 2014 and July 2017, the Office entered into settlements with these victims’ groups providing that any recovery the Government obtained through forfeiture would be distributed to the victims. In July 2017 and May 2021, the Office and the victims’ groups all obtained judgments against Assa’s interests in the Building and in related partnership distributions from the Building’s income.
In January 2025, this Office, the victims’ groups, and the Building’s owner entered into a further, final settlement providing for the dismissal of all remaining claims in exchange for a payment of $318 million to the victims’ groups, consisting of an initial payment of $129 million and a deferred payment of $189 million to be paid in three years, plus interest. The initial $129 million payment was completed Friday, March 20, 2026.
In addition to providing for recovery for terrorism victims, in connection with the settlement the partnership that owned the Building and the majority partner are being dissolved and the Building is being transferred to a new successor entity. The transfer of the Building and the transactions to consummate the global settlement agreement received approvals from the Office of the New York Attorney General’s Charities Bureau and the U.S. Department of the Treasury, Office of Foreign Assets Control.
Mr. Clayton praised the outstanding investigative work of the Federal Bureau of Investigation (“FBI”) and its New York Field Office Counterintelligence/Cyber Division; the FBI’s Joint Terrorism Task Force; the Internal Revenue Service, Criminal Investigation Division; and the New York City Police Department. Mr. Clayton also thanked the Counterterrorism Section of the Department of Justice National Security Division for their assistance in this case.
