The UK and US denied claims by Iranian state media that a prisoner swap was under way after anonymous sources on Sunday said Britain would pay millions of pounds to Tehran to free Iranian-British charity worker Nazanin Zaghari-Ratcliffe.
Hours earlier, UK Foreign Secretary Dominic Raab condemned Ms Zaghari-Ratcliffe’s “torturous” treatment by Iran.
She is one of three Iranian-British dual nationals held in Iran and any government deal with Tehran would look to secure the release of all of them.
Anoosheh Ashoori, 66, a retired engineer, is serving a 10-year sentence in Evin prison after being convicted of spying for Israel, despite never having visited the country.
Labour rights activist Mehran Raoof is also being “arbitrarily detained” in Evin.
Iranian state media reported Iran had agreed to release four Americans held on charges of spying in Tehran in exchange for the release of four Iranians detained in Washington and $7bn in frozen Iranian assets.
But US State Department spokesman Ned Price quickly denied the news.
“Reports that a prisoner swap deal has been reached are not true,” Mr Price told The National.
“As we have said, we always raise the cases of Americans detained or missing in Iran. We will not stop until we are able to reunite them with their families.”
It is understood that Ms Zaghari-Ratcliffe is being held in Iran, while her husband Richard Ratcliffe said the family “have heard nothing”.
“The release of Nazanin Zaghari-Ratcliffe in exchange for the UK’s payment of its £400 million ($552.6m) debt to Iran has been finalised,” an Iranian official told state TV.
The British debt to Tehran dates back to 1979 when the shah of Iran ordered UK-made military equipment.
The UK refused to deliver the tanks after the shah was ousted, and admits it owes Iran the money. US sanctions on Iran have made it more complicated to pay back.
“We continue to explore options to resolve this 40-year-old case and will not comment further as legal discussions are ongoing,” said a representative of the UK’s Foreign Office.
British politicians also denied that there were developments in the aid worker’s long-running case.
“I have spoken to her family and they have heard nothing confirming any of these rumours,” tweeted Tulip Siddiq, Ms Zaghari-Ratcliffe’s local MP.