The €300 million ($350 million) in question is being held by the European-Iranian Trade Bank, which is majority owned by Iranian state-owned banks, but registered in Hamburg with the German central bank, the Bundesbank.

According to a report by Germany's Bild newspaper, Iran wants to fly the money out as soon as possible to avoid the potential freezing of accounts as a result of reimposed US sanctions coming into effect in August.

If the operation goes ahead, it is likely to trigger a strong response from Washington. The US ambassador to Germany, Richard Grenell, already told the newspaper that the government of US President Donald Trump was "very concerned" and called on Berlin "to intervene and stop the plan."

Bild reported that the money to be flown out would be passed on to Iranians lacking a valid credit card to use while traveling abroad and in need of cash. Under impending US sanctions, Iranian banks will be excluded from the main credit card networks, including VISA and Mastercard.

Tough decision ahead

A German Finance Ministry spokeswoman said it would be one of the largest cash transfers ever in German history.

The German Foreign Ministry said the current probe would aim to determine whether the arrangement would be an infringement of existing sanctions, and that in order for them to intervene, there would have to be concrete evidence of illegal activity.

Bijan Djir-Sarai, an Iranian-German immigrant who is a member of the German federal parliament and the foreign policy speaker for business-friendly opposition Free Democrat Party, called on the government to do everything in its power to block the transfer, should there be any evidence that the money could be used to finance terrorist activities.

'Improperly exerting pressure'

Omid Nouripour from the environmentalist Greens told DW "the Iranians are trying to act before US sanctions come into effect — sanctions that we Europeans don't approve of as Iran has so far adhered to the nuclear deal."

Rolf Mützenich from the center-left SPD criticized the US ambassador for his early comments on the planned money transfer. "Ambassador Grenell is improperly exerting pressure on the German government again in demanding immediate steps to be taken," he told DW. "The ambassador should finally realize that German authorities will act in line with the laws in place."

Germany is in a bind over the requested transfer because blocking the move could be politically precarious, as it could mean the collapse of the Iran nuclear deal, which the European Union still hopes to salvage.

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(Published by DW, Jul 10, 2018)