A yellow ribbon hangs on a tree outside the family home of James Foley in Rochester, New Hampshire, August 2014.
Brian Snyder / Courtesy Reuters

Until June 2014, the hostage policy of the United States was clear. In seeking to secure the safe release of hostages, the United States would pay no ransoms and make no political concessions to terrorists. Unlike countries, mainly in Europe, that paid ransoms despite international censure, the United States held that “hostage takers looking for ransoms distinguish between those governments that pay ransoms and those that do not, and make a point of not taking hostages from those countries that do not pay.”

Within months, however, it became clear that the United States’ hostage policy was far from perfect. In August 2014, the self-proclaimed Islamic State (also known as ISIS) broadcast the murder of American journalist James Foley, followed soon by the murders of the American-Israeli journalist Steven Sotloff and the aid worker Peter Kassig. Then, during a December 2014 military rescue attempt in Yemen, al Qaeda in the Arabian Peninsula killed the U.S. journalist Luke Somers and the South African teacher Pierre Korkie. This January, the American aid worker Warren Weinstein and the Italian aid worker Giovanni Lo Porto, both held by al Qaeda in Pakistan, were inadvertently killed by a U.S. drone strike. And in February, ISIS announced that the American human rights activist Kayla Mueller, a hostage since August 2013, had been killed in a Jordanian air strike.

Last week, U.S. President Barack Obama acknowledged, for the first time, that the country had failed American hostages and their families. Although Washington still continues to oppose ransom payments, it will now be open to communicating and negotiating with hostage takers, and it will not stop families from paying ransoms on their own.

President Barack Obama announces a change in U.S. hostage policy in the Roosevelt Room at the White House, June 24, 2015.
Jonathan Ernst / Courtesy Reuters

With the policy shift, Obama is attempting the impossible task of balancing two uncomfortable truths: paying ransoms to designated terrorist groups may encourage further kidnapping (and is against international law), but paying ransoms may also increase the likelihood that a given hostage will return home alive—something any family would support. The latest research from YouGov puts this conflict in stark relief. Fifty-four percent of the Americans polled said that the U.S. government should not pay ransoms, but 56 percent said they would pay a ransom themselves to free a relative.

This will not be an easy balance to strike. The test for the new policy will be whether the 30 U.S. citizens still held hostage abroad return home safely or whether turning a blind eye to ransom payments simply puts more Americans at risk.


The loss of a family member to ISIS or al Qaeda is unfathomable enough, yet Washington compounded the pain through a management process characterized by poor communication with families and poor coordination among government agencies. In November 2014, seeking to understand how and where it had faltered, the White House ordered a comprehensive review of the nation’s hostage response policy, the fruits of which were revealed last week.

In announcing the new policy, Obama acknowledged the extent to which Washington had made things worse for the victims’ families. They were frustrated in dealing with their own government, confused about what Washington was prepared to do to help, and—in some cases—anxious that they would be punished for exploring their own options to bring their loved ones home.

A complete refusal to pay ransoms has proven to be wrong-headed.
 In his remarks, Obama made it clear that Washington would support families in the future and reminded that “no family of an American hostage has ever been prosecuted for paying a ransom for the return of their loved ones.” In doing so, however, he muddied the U.S. stance toward ransom payments, which has long held that the harms far outweigh the benefits. That view has been supported by the global counterterrorism campaign, which has made restricting and disrupting the financing of terrorism one of its core tenets. Since 9/11, the United Nations and other multilateral groups, such as the G8, have produced a series of laws and resolutions condemning the payment of ransoms to terrorists.

Artist Isaac Galvan works on a mural in tribute to journalist James Foley in Chicago, Illinois, October 2014.
Jim Young / Courtesy Reuters

The 2013 G8 summit in Northern Ireland, for example, noted that the international community had made “significant progress in combating the flow of funds to terrorist groups.” But it also warned of the financial benefit terrorist groups were earning from kidnappings. Terrorist groups place considerable value on kidnapping as a source of funding. Nasser al-Wuhayshi, the former leader of al Qaeda in the Arabian Peninsula, a group that is estimated to have earned $20 million from kidnap-for-ransom from 2011 to 2013, called the kidnapping of hostages “an easy spoil . . . a profitable trade and a precious treasure.” In several recorded messages, al Qaeda leader Ayman al-Zawahiri has called for supporters to kidnap Westerners. And ISIS is estimated to have raised up to $45 million from kidnappings in 2014.

Obama is attempting the impossible task of balancing two uncomfortable truths: paying ransoms to designated terrorist groups may encourage further kidnapping, but paying ransoms may also increase the likelihood that a given hostage will return home alive
In January 2014, the UN Security Council passed a further kidnap-for-ransom-related resolution calling upon member states “to prevent terrorists from benefiting directly or indirectly from ransom payments.” In the 18 months since, a blizzard of further UN Security Council resolutions has followed, all of which have addressed the importance of banning ransom payments. Yet payments appear to have continued, as hostages from a range of countries have returned home alive. Those from the United States and the United Kingdom—both of which have strict no-ransom policies—do not.

What will happen now that the United States has loosened its stance? House Speaker John Boehner expressed concern that the president could be putting Americans in danger, and House Judiciary Committee Chairman Bob Goodlatte accused the Obama administration of doing “more harm than good,” emboldening and incentivizing violent extremists “to capture and hold more Americans hostage for ransom.”

On the other hand, paying ransoms may actually save lives. A 2014 New York Times study of 23 hostages held in Syria found that those from countries that were willing to pay ransoms have been freed and returned home alive. A complete refusal to pay ransoms has thus proven to be wrong-headed. A more nuanced approach that leaves all options, including payment, open for negotiation is much more likely to result in success. In recent years, the international debate on ransom payments has become farcical. Leading nations have repeatedly signed up for “no ransom” commitments with one hand while making payments with the other. Obama’s policy announcement, contradictory as it may appear, is an important first step toward an honest, realistic, and much-needed debate.

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  • TOM KEATINGE is a former investment banker at J.P. Morgan and Director of the Centre for Financial Crime & Security Studies at the Royal United Services Institute. Follow him on Twitter @keatingetom.
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