U.S. Treasury Targets Russian Elements of the Houthis’ Iran-Backed Financing Network

Washington is intensifying pressure against Iran and its proxies. The U.S. Department of the Treasury announced new sanctions on April 2 against the Russia-based funding sources of Yemen’s Iran-backed Houthi terrorists. The designations reflect the increasingly close cooperation between Moscow and Tehran, which constitute part of the broader so-called “axis of aggressors” that also includes China and North Korea.

The sanctions target Russia-based Afghan brothers Hushang and Sohrab Ghairat for “working in coordination with Sa’id al-Jamal, a senior Houthi financial official backed by Iran’s Islamic Revolutionary Guard Corps-Quds Force (IRGC-QF),” Treasury said. The operatives have “procured tens of millions of dollars’ worth of commodities from Russia, including weapons and sensitive goods, as well as stolen Ukrainian grain” for the Houthis, Treasury added. The Trump administration also added eight digital asset wallets, locations for secure storage and transaction of cryptocurrencies and tokens, used by the Houthis to their sanctioned profile.

New Sanctions Build on Previous Designations

The United States previously sanctioned Sa’id al-Jamal in 2021 for helping fund the IRGC Quds Force and the Houthis. The Iran-based financier “directs a network of front companies and vessels that smuggle Iranian fuel, petroleum products, and other commodities to customers throughout the Middle East, Africa, and Asia,” according to Treasury’s announcement at the time. The statement said he had “generated tens of millions of dollars” from his illicit activities. U.S. sanctions in 2024 also targeted entities and individuals connected to Chinese, Emirati, and other elements of al-Jamal’s network.

The Trump administration has previously implicated Russia for supporting the Houthis as well. After Washington redesignated the Houthis as a foreign terrorist organization (FTO) on March 4, Treasury sanctioned key Houthi leaders for procuring weapons and funding from Russia. Treasury also targeted a Houthi operative, Abdulwali Abdoh Hasan al-Jabri, for facilitating the transfer of Yemenis to fight for Russia in Ukraine. Moscow has compensated the Houthis for this military assistance.

Digital Assets Enable Houthi Sanctions Evasion

The Houthis have used cryptocurrency to circumvent the conventional financial system. While Washington prohibits financial transactions with the Houthis and criminalizes the provision of material support to them, the use of cryptocurrency can make it challenging for law enforcement to identify and interrupt the group’s financial activity.

By adding digital asset wallets to the Houthi sanctions profile, the Trump administration aims to address this problem. Identifying these wallets as belonging to the Houthis tells government and financial authorities to block transactions consistent with the FTO and Specially Designated Global Terrorist (SDGT) designation requirements. The wallets, as identified on the platform hosting them by the U.S. Treasury-provided wallet address, currently contain about $750,000. However, in 2024 alone, millions of dollars moved through these accounts, including to and from wallets connected to al-Jamal’s network.

U.S. Should Continue Holding Houthi Facilitators to Account

While al-Jamal’s location in Iran offers him a degree of protection from American efforts to stop his illicit activity, his network relies on individuals and entities in countries willing to condone or facilitate Houthi terrorism in the Red Sea.

Russian business activity profiting the Houthis, including the supply of stolen Ukrainian grain, is unlikely to occur without government knowledge and assent. Furthermore, Houthi officials have repeatedly met with Russian state and military officials. The U.S. government should investigate the extent to which Russian government officials participate in activity that funds Iranian-backed terrorism and sanction them as appropriate.

The United States and its partners should also ensure the sanctions regime against the Houthis targets not only the conventional financial system and methods of business but also new financial technology.

Bridget Toomey is a research analyst at the Foundation for Defense of Democracies (FDD), where she focuses on Iranian proxies, specifically Iraqi militias and the Houthis. For more analysis from Bridget and FDD, please subscribe HERE. Follow FDD on X @FDD. FDD is a Washington, DC-based, nonpartisan research institute focusing on national security and foreign policy.