Treasury Increases Financial Pressure on the Houthis

WASHINGTON - Today, the Department of the Treasury's Office of Foreign Assets Control (OFAC) is sanctioning Yemen-based Yemen Kuwait Bank for Trade and Investment Y.S.C (Yemen Kuwait Bank) for its financial support to Ansarallah, commonly known as the Houthis. A U.S.-designated terrorist organization, Houthis continue to attack U.S. military personnel, U.S. regional partners, and legitimate commerce in the Red Sea.

"The Houthis rely on a few key financial institutions like Yemen Kuwait Bank to access the international financial system and finance their destabilizing attacks in the region," said Acting Under Secretary of the Treasury for Terrorism and Financial Intelligence Bradley T. Smith. "The United States is committed to disrupting these illicit channels and working with the internationally recognized Government of Yemen to ensure that the country's banking sector remains insulated from Houthi influence."

Today's designation builds on previous Treasury sanctions that have targeted Houthi-affiliated exchange houses and international finance networks responsible for channeling the illicit proceeds of Iranian petroleum sales to the Houthis. The Department of the Treasury remains committed to tackling the financial networks underpinning the Houthis' regional aggression. The United States is prepared to use all tools at our disposal to block their access to the U.S. financial system and work with our partners and allies to restrict their ability to access the global financial system.

This action is being taken pursuant to the counterterrorism authority, Executive Order (E.O.) 13224, as amended. The U.S. Department of State's designation of Ansarallah as a Specially Designated Global Terrorist (SDGT) pursuant to E.O. 13224, as amended, became effective on February 16, 2024.

YEMEN KUWAIT BANK

The Houthis rely on a network of exchange houses, banks, and other financial intermediaries to receive funds from, and engage in illicit trade with, Iran, including the Islamic Revolutionary Guard Corps-Qods Force (IRGC-QF). Senior Houthi officials, including Hashem Ismail Ali Ahmad al-Madani, the sanctioned governor of the Houthi-aligned central bank in Sana'a, have played key roles in transferring funds to the Houthis from the IRGC-QF.

Yemen Kuwait Bank aids the Houthis in exploiting the Yemeni banking sector to launder money and transfer funds to its allies, including Lebanese Hizballah. Yemen Kuwait Bank has helped the Houthis establish and finance front companies, which the group has used to facilitate Iranian oil sales in coordination with sanctioned Houthi-associated money exchange Swaid and Sons for Exchange Co.

Yemen Kuwait Bank is being designated pursuant to E.O. 13224, as amended, for having materially assisted, sponsored, or provided financial, material, or technological support for, or goods or services to or in support of, Ansarallah.

SANCTIONS IMPLICATIONS

As a result of today's action, all property and interests in property of the designated person described above that are in the United States or in the possession or control of U.S. persons is blocked and must be reported to OFAC. In addition, any entities that are owned, directly or indirectly, individually or in the aggregate, 50 percent or more by one or more blocked persons are also blocked. Unless authorized by a general or specific license issued by OFAC or exempt, U.S. sanctions generally prohibit all transactions by U.S. persons or within (or transiting) the United States that involve any property or interests in property of designated or otherwise blocked persons.

Violations of U.S. sanctions may result in the imposition of civil or criminal penalties on U.S. and foreign persons. OFAC may impose civil penalties for sanctions violations on a strict liability basis. OFAC's Economic Sanctions Enforcement Guidelines provide more information regarding OFAC's enforcement of U.S. economic sanctions. In addition, financial institutions and other persons may risk exposure to sanctions for engaging in certain transactions or activities with designated or otherwise blocked persons.

Furthermore, engaging in certain transactions with the individuals designated today entails risk of secondary sanctions pursuant to E.O. 13224, as amended. Pursuant to this authority, OFAC can prohibit or impose strict conditions on the opening or maintaining in the United States of a correspondent account or a payable-through account of any foreign financial institution that knowingly conducted or facilitated any significant transaction on behalf of a Specially Designated Global Terrorist.

The power and integrity of OFAC sanctions derive not only from OFAC's ability to designate and add persons to the Specially Designated Nationals and Blocked Persons (SDN) List, but also from its willingness to remove persons from the SDN List consistent with the law. The ultimate goal of sanctions is not to punish, but to bring about a positive change in behavior. For information concerning the process for seeking removal from an OFAC list, including the SDN List, please refer to OFAC's Frequently Asked Question 897 here. For detailed information on the process to submit a request for removal from an OFAC sanctions list, please click here.

For identifying information on the individuals and entity sanctioned today, click here.

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