Biden Admin Sanctions Suspected Houthi Funding Network Under Counterterrorism Authority

Yemen's Houthi fighters' takeover of the Galaxy Leader Cargo in the Red Sea coast off Hudaydah in the Red Sea, Yemen, on Nov. 20, 2023. (Houthi Movement via Getty Images)

The U.S. Treasury Department under the Biden administration has used a counterterrorism authority to sanction a suspected Iran-linked network funding the Islamist Houthi rebel movement in Yemen even as the administration is still deliberating whether to redesignate the Houthis as a terrorist organization.

On Thursday, the Treasury Department’s Office of Foreign Assets Control (OFAC) designated Nabil Ali Ahmed Al-Hadha for sanctions. Mr. Al-Hadha is the president of the Currency Exchangers Association in the Yemeni capital city of Sana'a, which is currently controlled by the Houthis.

OFAC also designated the Yemen-based and Houthi-run Al Rawda Exchange and Money Transfers Company, the Yemen-based Nabco Money Exchange and Remittance Co. (Nabco), and the Turkey-based Al Aman Kargo Ithalat Ihracat Ve Nakliyat Limited Sirketi (Al Aman).

Mr. Al-Hadha and the three exchange houses were all designated for sanctions under a 2001 presidential executive order that targets individuals who have committed acts of terrorism or who pose a risk of committing acts of terrorism.

The Houthis, also known as Ansar Allah, are a Zaydi Shiite movement that has intermittently fought with Yemen’s internationally recognized government since 2004. The conflict in Yemen expanded after the Houthis took over the Yemeni capital of Sanaa in September 2014, bringing on a civil war that has seen Saudi Arabia and other Gulf states intervene against the Houthis. While the Yemeni civil war has died down in recent months with efforts at a ceasefire in Yemen, the Iran-backed Houthi movement has shifted its focus toward the ongoing fighting in the Gaza Strip between Israel and the Hamas terrorist group.

The new U.S. sanctions on Thursday come as the Houthis have claimed credit for numerous drone and missile attacks targeting Israel’s Red Sea port city of Eilat, and commercial shipping vessels transiting the Red Sea and adjoining Gulf of Aden. The Houthis also claimed credit for a helicopter-borne assault on the Bahamas-flagged cargo ship MV Galaxy Leader on Nov. 20, in which gunmen hijacked the ship in the Red Sea and took its 25 crew members hostage.

“Today’s action underscores our resolve to restrict the illicit flow of funds to the Houthis, who continue to conduct dangerous attacks on international shipping and risk further destabilizing the region,” said Under Secretary of the Treasury for Terrorism and Financial Intelligence Brian E. Nelson. “The United States, along with our allies and partners, will continue to target the key facilitation networks that enable the destabilizing activities of the Houthis and their backers in Iran.”

Biden Administration Still Weighing Houthi Terror Label

The United States had designated the Houthis as a foreign terrorist organization during President Donald Trump’s last days in office in 2021, but within weeks of taking office, President Joe Biden reversed the terror designation.

The Biden administration has begun deliberations to redesignate the Houthis as a foreign terrorist organization, amid the recent attacks on Red Sea shipping, but has yet to reach a decision.

Explaining its use of a 2001 counterterrorism executive order to sanction Mr. Al-hadha and the three exchange houses on Thursday, the Treasury Department linked all four entities to Sa’id Al-Jamal, an Iranian financier with suspected ties to Iran’s Islamic Revolutionary Guard Corps-Qods Force (IRGC-QF). The Treasury Department said Mr. Al-Hadha and the three exchange houses together facilitated the transfer of millions of dollars to the Houthis at the behest of Mr. Al-Jamal.

The IRGC was also designated by the United States as a foreign terrorist organization during the Trump administration and remains so to this day.

The Treasury Department targeted Mr. Al-Jamal with sanctions efforts in 2021 and 2022 for suspected efforts to finance the IRGC and the Houthis.

White House National Security Council (NSC) spokesperson John Kirby said in November, after the hijacking of the MV Galaxy Leader, that the Biden administration had “begun a review of potential terrorist designation” for the Houthis. Asked about the progress of this review process on Dec. 19, Mr. Kirby said “I don’t have a timeline” for when the Biden administration will reach a decision on the terrorism label.

NTD News reached out to the White House for more details on the timeline to review the Houthi’s status as a terrorist organization and how the most recent sanctions may be impacted without the label. In an emailed response, a White House NSC spokesperson said the administration does not have more to add about the Houthi’s status and referred questions about the sanctions to the Treasury Department.

NTD News reached out to the Treasury Department and the State Department for comment but did not receive responses by press time.

Jonathan Schanzer, senior vice president for research at the Foundation for Defense of Democracies, criticized the Biden administration for not having reached a decision to redesignate the Houthis as terrorists.

“Observe the mental gymnastics here,” Mr. Schanzer wrote in a post on the X social media platform on Thursday. “The policy contortionists at State today issued designations on facilitators of Houthi terror. Yet the Biden administration still refuses to designate the Houthis as a terrorist group.”

NTD News reached out to the White House, the Treasury Department, and the State Department for comment on the timeline for deciding the Houthi movement’s status as a terrorist organization and how the most recent sanctions actions may be impacted without the label. None of the three departments responded by press time.

This article has been updated after an additional comment from a White House NSC spokesperson.

From NTD News