U.S. Relists Yemen’s Iran-Backed Houthis as Foreign Terrorist Organization

It’s back to the future for the Trump administration in the Middle East.

Earlier this week, the U.S. Department of State announced the redesignation of Yemen’s Iran-backed Houthi rebels as a Foreign Terrorist Organization (FTO). The relisting is the latest in a diplomatic drama that initially saw the Trump administration designate the group at the end of its first term in January 2021. The Biden administration reversed Trump’s decision less than a month after it entered office.

Significance of FTO Designation

According to a White House fact sheet, the FTO designation is part of a wider administration effort to “eliminate the Houthis’ capabilities and operations, deprive them of resources, and thereby end their attacks on U.S. personnel and civilians, U.S. partners, and maritime shipping in the Red Sea.”

The designation specifically enables the United States to ban Houthi members from entering the United States, increases criminal penalties for the provision of material support to the entity, allows victims to sue any entity supporting the Houthis, and expands the range of extraterritorial penalties against the Houthis. The extraterritorial application of an FTO criminalizes any “material support or resources” to the group.

Conversely, the group’s Specially Designated Global Terrorist (SDGT) status, which the Biden administration imposed in 2024, prohibits financial transactions between U.S. persons and entities with a designated group. But by criminalizing such assistance, the FTO designation further isolates the terrorists from the international community. The listing also requires U.S. governmental and nongovernmental aid groups to review their activities in Yemen to ensure the Houthis are not profiting from humanitarian projects.

The new designation maintains humanitarian general licenses but terminates permissions for refined petroleum products and telecommunications technology or transmissions to the Houthis or any entity connected to them.

Houthi Behavior Warrants FTO Listing

When initially listing the Houthis in 2021, the Trump administration cited persistent Houthi attacks on civilian targets, including an assault on a civilian airport in 2019 that killed three members of the International Committee of the Red Cross. Throughout the course of their military campaign across Yemen, the Houthis have employed siege tactics, absconded with humanitarian aid, used child soldiers, detained humanitarian workers, and forcibly disappeared religious minorities.

Yemen’s Houthi fighters have grown to become important members of the Islamic Republic’s Axis of Resistance — a constellation of terror proxies backed by Tehran — and directly received material and financial support from Iran’s Islamic Revolutionary Guard Corps, which the Trump administration listed as an FTO in 2019. Following Hamas’s atrocities on October 7, 2023, the Houthis attempted more than 100 attacks on civilian vessels in the Red Sea, fired at U.S. naval warships dozens of times, and launched more than 300 attacks aimed at Israel, all with Iran-provided weapons. According to the U.S. Defense Intelligence Agency, Houthi attacks have affected the interests of at least 65 countries and at least 29 international energy and shipping firms.

Treasury Acts on the FTO Listing With Eyes Toward Oman

Concurrent with the relisting of the Houthis as an FTO, the U.S. Treasury sanctioned seven Houthi operatives this week who “have sought new sources of advanced weapons, military grade materiel, and foreign support to drive attacks.” Treasury also sanctioned a Houthi military leader and his company, Al-Jabri General Trading and Investment Co, for their role in recruiting Yemenis to fight for Russia.

Three of the sanctioned individuals and the Al-Jabri headquarters are located in Oman, a further testament to the sanctuary that Muscat has provided to Houthi terrorists. Beyond being a safe haven, Oman has become a logistics and financial hub for the Houthis throughout the conflict in Yemen.

These new sanctions demonstrate U.S. resolve to follow the FTO designation and expose, isolate, and disrupt Houthi weapons supplies. To build on these actions, Washington should pressure Muscat to expel Houthi leaders and ensure its financial institutions and corporations are not enabling or underwriting Houthi threats.

Bridget Toomey is a research analyst at the Foundation for Defense of Democracies (FDD), where Behnam Ben Taleblu is a senior fellow and senior director of the Iran Program. For more analysis from the authors and FDD, please subscribe HERE. Follow FDD on X @FDD and @FDD_Iran. FDD is a Washington, DC-based, nonpartisan research institute focusing on foreign policy and national security.