October 16, 2026 | NatSec Roundup

The Houthis’ airport attacks, Kalshi’s insider-betting probe, and State’s ICC sanctions (October 16)

October 16, 2026 NatSec Roundup

The Houthis’ airport attacks, Kalshi’s insider-betting probe, and State’s ICC sanctions (October 16)

FDD Action · NatSec Roundup · October 16, 2026
FDD Action NatSec Roundup
October 16, 2026

The Houthis’ Airport Attacks, Kalshi’s Insider-Betting Probe, and State’s ICC Sanctions

Welcome to FDD Action’s Weekly NatSec Roundup.

👀 Check it out: As promised, here is the FDD Action FY 2027 NDAA Resource Guide, identifying House and Senate provisions that we support and that should survive conference.

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🚨 Need-to-Know This Week
President Trump with Saudi Crown Prince Mohammed Bin Salman

President Trump speaks with Saudi Crown Prince Mohammed Bin Salman Al Saud after his arrival to King Khalid International Airport in Riyadh, Saudi Arabia, May 13, 2025. (Official White House Photo by Daniel Torok)

1. As Saudi-backed Yemeni forces fight to retake territory held by the Houthis, the terrorist group carried out a barrage of attacks on a major Saudi airport over the weekend, making the case yet again for why Washington must step in to defeat the militia.

  • Escalating terror: The Houthis’ strikes killed over 15 people, including one American, and forced the airport to halt operations all week. The attacks came after Yemeni government forces launched a counteroffensive last week against the Houthis, reclaiming part of the Red Sea coast. Houthi control of that territory had given the group greater leverage over the Bab al-Mandeb Strait, a chokepoint for global shipping. They also pushed back against Houthi positions around Taiz city, which strategically sits between the west coast and the government’s interim capital of Aden. Still, battlefield gains alone will not solve the problem: the Houthis have grown into a resilient force whose reach extends well beyond Yemen.
  • A unique threat: The Houthis have become a sophisticated military organization with advanced missiles, drones, and anti-ship weapons. This has helped them develop “the ability to conduct sustained campaigns across large distances while simultaneously projecting missile, drone and maritime power across international borders,” warns FDD’s Hussain Abdul-Hussain. By targeting Saudi infrastructure and threatening Red Sea shipping, the Houthis have transformed themselves from a Yemeni insurgency into a geopolitical threat to Riyadh.
  • Iran and China’s roles: Iranian backing sustains much of the Houthis’ capabilities, and the relationship has grown even closer in recent years, notes Abdul-Hussain. Reuters reported in July that Iran flew military personnel, alongside missile- and drone-related equipment, into Yemen. Iranian commanders then helped direct the Houthis’ advance along the Red Sea coast. But the Houthis are not putting all their eggs in Tehran’s basket: the group increasingly relies on Chinese dual-use technologies to diversify its supply chain, FDD’s Bridget Toomey and Behnam Ben Taleblu write. The Houthis are even reportedly attempting to produce their own medium-range ballistic missiles using Chinese-delivered parts that would put all of Saudi Arabia and Israel within reach.
  • A pact, undermined: Days into the Yemeni counteroffensive, Saudi Arabia, Turkey, and Pakistan activated the Mecca Pact, pledging to implement their collective defense commitments for the kingdom. But domestic political realities and a desire to avoid antagonizing Iran will likely limit Ankara and Islamabad to defensive measures, explains FDD’s Ahmad Sharawi. Those measures are unlikely to deter the Houthis, who have dismissed the pact as a “cosmetic” alliance and doubt Turkey and Pakistan will join the war. Sharawi recommends Washington press both countries to go beyond contributing defensive capabilities to Gulf security. They should counter networks that enable Iran and its proxies to threaten the region.
  • Rally the coalition: While the Red Sea coast has drawn the most attention, the fight for Taiz matters just as much, FDD Action’s Matt Zweig tells us. The Houthis have made significant inroads around the city, and its fall could mark a major tipping point in the war. Yet no regional actor has proven capable of countering the Houthis alone or holding a coalition together against the threat. That’s where the United States must come in, Zweig adds. He recommends Washington take the lead by bridging partners’ competing interests and forging a united front capable of defeating the Houthis.
White House Press Secretary Katie Zacharia

White House Press Secretary Katie Zacharia holds her first press briefing at the White House, Oct. 13, 2026. (Official White House Photo by Andrea Hanks)

2. Kalshi launched an investigation into suspicious bets on Trump’s pick for White House press secretary amid growing concerns that prediction markets, platforms where users bet on real-world events, could expose sensitive information to U.S. adversaries.

  • Suspicious trades: Kalshi is examining a series of trades that correctly called President Trump’s choice of conservative commentator Katie Zacharia to be his next press secretary. News outlets began reporting her selection around 2 PM ET last Friday, and Trump confirmed it that afternoon in a Truth Social post. But before the news broke, some individuals may have already known: at least three small but suspiciously well-timed bets had been placed that stood to earn bettors thousands of dollars. Those bets are especially notable given that Zacharia was a long shot, with Kalshi traders putting her odds at only about 1% in the days leading up to the reports.
  • Insiders’ new temptation: Prediction markets have created a new temptation for insiders to cash in on nonpublic information, reports The Wall Street Journal. Case in point: Trump’s former teleprompter operator, Gabriel Perez, was fired from the White House after netting more than $100,000 on bets about the President’s speeches. Likewise, after a series of well-timed bets related to the Iran war, the White House sent a memo to staff warning them against using nonpublic information for private gain. Yet the Journal notes that betting markets are becoming increasingly embedded in Washington’s culture.
  • Adversaries’ edge: America’s adversaries are always searching for an edge, and they may have found it in prediction markets, FDD’s Max Meizlish and Alex Goldenberg explain. Prediction markets let participants bet on future events, with prices reflecting each outcome’s likelihood. Because traders put their own money at risk, these markets can aggregate dispersed information and sometimes outperform polls and experts. A paper in the U.S. Army’s Military Intelligence Professional Bulletin last year suggests that prediction-market data can be a valuable intelligence source. But the very features that make these markets useful also leave them open to exploitation and turn them into a channel for leaking sensitive information to foreign adversaries, Meizlish and Goldenberg warn.
  • Manufacturing panic: Foreign entities could weaponize prediction markets – not just mine them for sensitive information – by placing large bets to generate a flurry of headlines that fuel panic and rattle financial markets, Meizlish and Goldenberg stress. Media coverage compounds these risks, as major news organizations now cite prediction-market odds in their reporting. AI adds another wrinkle: automated agents could manufacture the appearance of market consensus, with serious consequences for ordinary Americans. Taken together, “adversaries don’t need insider access or even insider information to use these markets as weapons—just capital,” Meizlish and Goldenberg write.
  • Playing catch-up: Despite these risks, Washington has been slow to confront the growing national-security threat these markets pose. To address these vulnerabilities, Meizlish and Goldenberg recommend that Treasury identify red flags in prediction-market activity and direct financial institutions to report suspicious bets on sensitive geopolitical events. The pair also urge the Commodity Futures Trading Commission and relevant state authorities to require prediction markets to build surveillance protocols that detect trading patterns consistent with classified-information exploitation or coordinated manipulation. They further call on Washington to work with intelligence partners to develop shared approaches for catching insider trading and manipulation by adversary intelligence services.
🏛️ At the White House
Secretary Marco Rubio delivers remarks at the State Department

Secretary Marco Rubio delivers remarks during the Global Town Hall at the Department of State in Washington, Jul. 2, 2026.

1. The State Department sanctioned the International Criminal Court (ICC) last Friday, vowing to keep up the pressure until the court is brought to heel. The move escalates the department’s plan, announced in July, to dismantle the court.

  • Escalated sanctions: These sanctions go beyond earlier measures that only targeted individual prosecutors and judges. In a press release accompanying the action, Secretary of State Marco Rubio said the United States will ban transactions with the “rogue court,” cutting off its resources and crippling its operations. He added that Washington still holds out hope for a diplomatic solution and has structured its action to give ICC member states the opportunity to propose a solution that addresses U.S. concerns. But if the court is not reined in, “the United States will continue its campaign to dismantle the ICC, brick by brick, until Americans are threatened no longer,” Rubio warned.
  • Bipartisan backlash: The ICC is supposed to act only when governments fail to police themselves, yet it opened a 2020 investigation into alleged U.S. war crimes in Afghanistan. Opposition to the ICC’s reach over Americans has long been bipartisan. Since the court’s founding in 2002, administrations of both parties have declined to join it, fearing its politicization and misuse. Also in 2002, a bipartisan Senate supermajority passed the American Servicemembers’ Protection Act, authorizing the President “to use all means necessary” to stop the ICC from detaining Americans. Rubio made the same case in his press release last week, noting that Republicans and Democrats alike have rejected the court’s authority over Americans.
  • Closing the loophole: The American Servicemembers’ Protection Act bars U.S. government agencies from aiding the ICC, but it does not cover private companies or individuals, FDD Action’s Matt Zweig tells us. Nothing stops a U.S. firm from handing Americans’ or allies’ sensitive data to the ICC, either directly or through a Rome Statute government or international organization. Congress should close that gap legislatively, Zweig concludes.
Treasury Building

Treasury Building, October 20, 2009. (Official Treasury Department Photo)

2. The Treasury Department is greenlighting the sale of Russian diesel through April 2027 in a move that shows why further action is needed to keep that revenue from bankrolling the Kremlin’s war against Ukraine.

  • Executive action: Last Friday, President Trump announced that Russia would release 1.8 million tons of diesel onto global markets. Treasury subsequently issued General License (GL) 135, a six-month authorization to sell newly produced Russian diesel. To make these deliveries, Moscow partially lifted the diesel export ban it imposed in July. The Trump administration’s action last week follows the licenses issued for Russian oil in the spring, which were each valid for one month and restricted to oil already loaded onto tankers.
  • Why it matters: “Russia’s ability to fund its war machine depends heavily on continued energy export revenue, the backbone of Moscow’s federal budget,” explain FDD’s Max Meizlish and John Hardie. The same film has already played out with Iran. In June, Treasury issued GL X, which permitted the sale of otherwise sanctioned Iranian oil and netted Tehran billions of dollars. Because the license lacked an escrow mechanism and reporting requirements, the regime was free to funnel those billions into its armed forces and sustain its threats to the United States. To avoid a sequel, Treasury should implement an escrow mechanism for Russian diesel revenue.
  • Congressional response: A bipartisan group of senators has sent a joint letter urging the President to rescind GL 135. The senators explained that the license will do little to lower American fuel prices. At the same time, the Kremlin’s use of the revenue will “undoubtedly finance its desired war of attrition and advance its security cooperation with China, Iran and North Korea” while also endangering U.S. service members. The license also runs counter to the spirit of last month’s Lindsey O. Graham Sanctioning Russia and Iran Act of 2026, which mandates economic pressure on Russia and its enablers.
🔍 What’s Moving on the Hill

✔︎ Endorsed NDAA Provisions: MATCH Act (Senate Manager’s Amdt § 6040), Chip Security Act (Amdt §§ 6081–6086), and AI OVERWATCH Act (Amdt § 6243) – These provisions close loopholes that let Beijing get its hands on the chips powering America’s AI advantage. The MATCH Act aligns allied export controls to block China’s indigenous production of advanced AI chips. The Chip Security Act requires chip manufacturers to build in security measures that keep America’s advanced AI chips from being diverted to adversaries. The AI OVERWATCH Act strengthens congressional oversight of the export of America’s most advanced chips.

✔︎ Endorsed NDAA Provisions: Information Operations (House § 1054, House § 1089C, House § 1099) – These provisions strengthen America’s ability to go on the offensive in the information environment. Sec. 1054 establishes an Army Information Operations Center of Excellence to advance information operations across operational and tactical levels. Sec. 1089C requires a feasibility study on whether lower-level commanders should have authority to approve tactical information operations. Sec. 1099 requires the Secretary of Defense to determine whether to designate information as a warfighting domain alongside land, air, sea, space, and cyber.

✔︎ Endorsed NDAA Provisions: REVOKE Act (House § 1099L), PAID OFF Act (Senate Manager’s Amdt § 6035), and CLEAR Path Act (Amdt § 6807) – This legislative package takes aim at foreign adversary influence on U.S. national security policymaking. The REVOKE Act revokes security clearances for individuals who have lobbied on behalf of Chinese military companies. The PAID OFF Act closes loopholes that allow unregistered agents of foreign adversaries to lobby in the United States. The CLEAR Path Act expands existing State Department post-employment restrictions to ban agency heads, deputies, and Senate-confirmed officials from lobbying for foreign adversaries.

📣 Winning Messages
💡 Here’s an Idea
Secretary of Defense Pete Hegseth speaks to U.S. Coast Guard members

Secretary of Defense Pete Hegseth speaks to members of the U.S. Coast Guard at U.S. Coast Guard headquarters in Washington, D.C., May 19, 2026. (DHS photo by Tia Dufour)

Expose foreign influence on social media platforms.

In the lead-up to the November 3 midterm elections, Secretary of Defense Pete Hegseth instructed Cyber Command and the Defense Intelligence Enterprise to defend U.S. election infrastructure against foreign threats. While important, the directive does nothing about the activity inside the United States that lets foreign networks operate undetected. The threat is far from theoretical. Researchers have tied a wave of AI-generated videos of celebrities commenting on Senate races to a known Russian operation, and Meta has separately removed an Iranian network posing as American activists. We only know about these incidents because someone bothered to look, but no rule required it, and nobody can say how much more is out there.

In a recent article, FDD’s Jacob Breach lays out three steps Congress should take to shed light on foreign propaganda efforts on social media platforms:

  • Require identification of foreign government involvement. Broadcasters who lease airtime must ask whether a foreign government is behind the programming. Social media platforms face no such obligation, even though they can carry the same message to a far larger audience. Congress should close that gap by requiring platforms to identify whether foreign governments are behind the accounts and networks buying or receiving distribution.
  • Require disclosure of foreign-paid messaging. Congress should similarly require disclosure when a foreign government pays for a message reaching Americans, whether through an advertisement or a paid American voice.
  • Require platforms to report foreign deception. Platforms can see indicators of who is behind an account, but they have no obligation to look and no incentive to publish what they find. Congress should fix that by creating a reporting duty when a platform identifies deceptive behavior traceable to a foreign state. The requirement would be modeled on the suspicious activity reports banks already file.

As Breach explains, none of these recommendations ask the government to remove a post or judge a claim, nor do they distinguish among foreign governments, whether adversary or ally. They simply let Americans see who is speaking to them.

🧐 On a Lighter Note…
Bananas and cereals at a grocery store

Bananas and cereals at a grocery store in Fairfax, Virginia, Mar. 3, 2011. (USDA Photo by Lance Cheung)

🍌Going bananas in Washington: Is it just me, or has D.C. fully gone bananas? Recently, America’s most consumed fruit has been in various headlines. Whether you’re interested in sports, social events, banana-flavored treats, or maybe just need some more potassium in your diet, here’s a recap of everything banana-related you might have missed:

  • Savannah Bananas: Banana Ball crowned its first league champion on Saturday at Nationals Park, where WWE legend John Cena arrived by Humvee with a police escort to deliver the game ball. The night was filled with performances from The Jonas Brothers, cast members from “Dancing with the Stars,” Pentatonix, and more. When the dust settled, the Texas Tailgaters had topped the Savannah Bananas 2-1 in the inaugural Banana Bowl.
  • Banana Ball: This baseball performance has captured headlines in recent years for its interesting twist on America’s favorite pastime. In Banana Ball, there are unique rules, including no bunting, batters can steal first base, foul balls caught by fans count as an out, and the showdown tiebreaker. Banana Ball puts fans first by ensuring constant entertainment. If you’re interested in a show to invite both your sports-loving friends and theatre-loving friends to, be on the lookout for next season’s schedule and shows near you!
  • Partiful invitations: Making friends can be hard, that’s why there’s Partiful. Last month, Partiful made headlines for a banana-eating event that over 900 people attended. The event was in response to an apple-eating event the month prior, in which some people could not participate, so 900 people decided it was time to peel away from the apple crowd. If you’re ever feeling lost with nothing to do, check out Partiful – there’s sure to be something bananas on there!
  • Trendy flavors: In the age of social media, everything seems to be a “viral” or “must-try” item, but banana-flavored drinks seem to be the real deal. The #Bananalatte has taken the internet by storm this past summer. And beyond coffee, bananas also have appeal in new cocktails, soda, beer, and (somehow) water too. For the potassium lovers out there, this is your time to shine! Even the skeptics can’t split on this one: banana is having a moment.
🔆 FDD Action Spotlight
📘 Keeping Up w/ FDD

👋 Thanks for sticking with us! Until next week.

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Issues:

Arab Politics Cyber Gulf States International Organizations Iran Lawfare Russia Sanctions and Illicit Finance