President Donald Trump declared on July 23, 2026, that any damage by Iranian attacks “to ships, cargo, or anything related thereto, will be paid for by Iranian money that the United States has in its possession, and controls.” Iraqi Kurdistan fits that criterion, and the Trump administration could make a compelling case for using frozen assets to compensate victims of Iranian attacks in the semi-autonomous region.
Iraqi Kurdistan has been one of the primary targets of Iranian attacks since the war began on February 28. Iran and its Iraqi proxy militias have launched more than 1,000 missile and drone attacks against the Kurdistan Region, making it one of the hardest-hit areas by Iran across the region. In terms of casualties, the Kurdistan Region has also suffered the one of highest tolls in the Middle East, with at least 30 people killed and more than 150 wounded in Iranian attacks since the war began.
Iran and its Iraqi proxy militias have launched more than 1,000 missile and drone attacks against the Kurdistan Region, making it one of the hardest-hit areas.
Even during the fragile ceasefire between Washington and Tehran, the Iranian regime and its proxies continued cross-border strikes into Iraqi Kurdistan. Since Trump’s announcement about the frozen funds, Iran has carried out attacks daily against targets across Iraqi Kurdistan. Iranian aggression against Kurdistan is on multiple fronts. It has repeatedly targeted civilian and critical infrastructure, including refugee camps, oil fields, and power plants.
Compensating victims of Iranian attacks would demonstrate Washington’s commitment to its regional partners while imposing tangible financial consequences on Tehran. It would also show that Trump’s announcement is backed by concrete action.
Existing U.S. legal authorities provide potential avenues for pursuing such compensation. The Foreign Sovereign Immunities Act contains a terrorism exception that allows certain victims of state-sponsored terrorism to seek damages against designated state sponsors of terrorism, including Iran. Plaintiffs who obtain judgments against Iran, in some cases, have been able to recover utilizing blocked or frozen Iranian assets located in the United States under statutes such as the Terrorism Risk Insurance Act.
Kurdish individuals, businesses, and other entities harmed by Iranian missile and drone strikes could explore how to bring claims in U.S. courts or seek compensation through any future claims process established by the executive branch or Congress.
The Kurdistan Regional Government, affected municipalities, energy companies, humanitarian organizations, and private citizens in Iraqi Kurdistan could strengthen such claims by systematically documenting physical damage, civilian casualties, economic losses, and evidence linking the attacks to Iran or Iran-backed proxy groups.
Iraqi Kurdistan has long been a close U.S. partner, yet it lacks sovereign authority and military capabilities to fully defend itself against sustained Iranian attacks.
Coordinated legal action supported by U.S. and international counsel would increase the likelihood of successful claims and ensure that frozen Iranian assets, if made available under U.S. law, are directed toward rebuilding communities and compensating victims.
While victims of Iranian attacks elsewhere in the region may view Trump’s announcement as symbolic, victims in Iraqi Kurdistan could see it as a meaningful opportunity to pursue compensation for the extensive losses they have suffered since the start of the conflict.
Iraqi Kurdistan has long been a close U.S. partner, yet it lacks sovereign authority and military capabilities to fully defend itself against sustained Iranian attacks. That vulnerability strengthens the case for greater U.S. protection and support.
If the administration is serious about using frozen Iranian assets to hold Tehran financially accountable, Iraqi Kurdistan should be the first place where the United States puts that commitment into practice. Doing so not only would help rebuild communities devastated by Iranian aggression but also would establish a precedent in the region that states responsible for unlawful attacks cannot escape the financial consequences of their actions.
