According to the report, in January 2018, Saudi Arabia, under its development and reconstruction program, deposited $2 billion with the Central Bank of Yemen. The funds were provided to fund a letter of credit, as well as to purchase items including rice, sugar, milk, wheat and flour to stabilize food security in the Middle East's poorest nation, and to stabilize domestic prices.
"The Government of Yemen implemented a scheme to divert funds from the Saudi deposit, in which $423 million of public money was illegally transferred to traders," the Tuesday report said.
The report revealed that the Central Bank of Yemen broke its foreign exchange rules, manipulated the foreign exchange market and laundered a substantial part of the Saudi deposit at the expense of the Yemeni population.
"The Panel views this case as an act of money-laundering and corruption perpetrated by government institutions, in this case the Central Bank of Yemen and the Government of Yemen," the report said.
It also found that the Houthis performed functions exclusively within the authority of Yemen’s government. In 2019, the militants successfully diverted some $1.8 billion from the government through the collection of taxes and other state revenue, a large portion of which was used to fund the war effort.
Yemen has been engulfed in an armed conflict between government forces led by President-in-exile Abd Rabbuh Mansur Hadi and the armed Houthi opposition movement since 2014.
An Arab coalition, predominantly led by Saudi Arabia and the United Arab Emirates, in 2015 launched an operation to support the internationally-recognized government of Hadi. The Houthis continue to maintain control over the vast north of the country, including the nation's capital, Sanaa.
The United Nations considers Yemen to be experiencing the world’s worst humanitarian crisis, with over 80 percent of the population, or 24.1 million people, in need of immediate humanitarian assistance.