According to the Washington Post on Sunday, the seizure was justified as an attempt to “determine whether Saudi government money knowingly or unknowingly helped fund extremists”.
The probe, requested by congressional leaders and approved by the National Security Council, is unprecedented and has outraged Saudi Arabian officials.
Embassy staff reaction
"If you want this information, why didn't you just ask us? We would have given it to you," a senior Saudi official was quoted as saying.
The government of Saudi Arabia has subsequently turned over embassy spending records for the past 20 years, the official said, adding: "We have nothing to hide."
The probe, which extends to the activities of Saudi Arabia consulates across the US, began this August.
It was launched as the US and the Saudi Arabian governments were hailing a new era of cooperation in fighting various Islamist organisations such as al-Qaida - and shortly after the deportation of a Los Angeles consulate staff member.
The Saudi Arabian official told the Post that the large sums of money that pass through the embassy are accounted for, with most of it - $160 million a year - going to Saudi Arabian students studying in the US.
"The notion that we can send money here and not account for it is preposterous. We are not a banana republic."
Saudi Arabian political analyst Zuhair al-Harithi told Aljazeera on Monday that the investigation may negatively affect the US-Saudi relationship.
“Such a procedure is unacceptable - it is against the international law,” he said.
“No government has ever probed into the bank accounts of embassies, as every embassy has its own diplomatic immunity,” he said.
Al-Harithi also believes that this probe comes in the context of the US propaganda campaign against Saudi Arabia.
“Despite security co-operation between the United States and Saudi Arabia, some neoconservatives in the US administration want to break ties, aggressively pursuing any opportunity to deteriorate relations,” he added.