Iran's Foreign Ministry spokesperson Nasser Kanaani said the funds, which had been frozen in South Korea, would be in Iran's possession on Monday so the deal mediated by Qatar during months of talks could go ahead.

There was no immediate public U.S. comment.

"Both parties have been notified by Qatar that all $6 billion has been transferred from Switzerland to bank accounts in Qatar," the source briefed on the matter told Reuters.

"A Qatari aircraft is on standby in Iran waiting to fly five soon-to-be released U.S. citizens and two relatives to Doha on Monday morning."

Under the deal, the five Americans with dual nationality are expected to leave Tehran and head to Qatar's capital Doha and then from there fly to the United States.

In return, five Iranians detained in the U.S. will be released. The Iranian Foreign ministry spokesperson said two would return to Iran while two would stay in the U.S. at their request. One detainee would join his family in a third country, he added.

The deal, first made public on Aug. 10, will remove a major irritant between Washington and Tehran, although the two sides remain deeply at odds over issues ranging from Iran's nuclear ambitions and its influence around the region to U.S. sanctions and America's military presence in the Gulf.

South Korea's Foreign Ministry had said on Monday it was working with all parties on the deal "to ensure smooth progress of all procedures so that it will be resolved once and for all."

SANCTIONS WAIVED

The U.S. dual citizens to be released include Siamak Namazi, 51, and Emad Sharqi, 59, both businessmen, and Morad Tahbaz, 67, an environmentalist who also holds British nationality. They were released from prison and put under house arrest last month.

A fourth U.S. citizen was also released into house arrest, while a fifth was already under house arrest. Their identities have not been disclosed.

Iranian officials have named the five Iranians to be released by the U.S. as Mehrdad Moin-Ansari, Kambiz Attar-Kashani, Reza Sarhangpour-Kafrani, Amin Hassanzadeh and Kaveh Afrasiabi. Two Iranian officials previously said that Afrasiabi would remain in the United States but did not mention others.

Ties between Washington and Tehran have been boiling since Donald Trump, a Republican, pulled the U.S. out of a nuclear deal between Iran and global powers when he was president in 2018. Reaching another nuclear deal has gained little traction since then, as President Joe Biden prepares for the 2024 U.S. election.

As a first step in the deal, Washington waived sanctions to allow the transfer of $6 billion in Iranian funds from South Korea to Qatar. The funds were blocked in South Korea, normally one of Iran's largest oil customers, when Washington imposed tough financial sanctions on Tehran and the cash could not be transferred.

Under the agreement, Doha agreed to monitor how Iran spends the unfrozen funds to ensure it goes on non-sanctioned humanitarian goods, such as food and medicine.

The transfer of Iran's funds has drawn criticism from U.S. Republicans who say Biden, a Democrat, is in effect paying a ransom for U.S. citizens. The White House has defended the deal.

(This story has been corrected to say Iranians are held in the U.S. in paragraph 7)