Washington: In what is reported to be the biggest criminal enforcement action ever brought against North Korea, the US Justice Department has accused a network of North Korean and Chinese citizens of secretly advancing North Korea’s nuclear weapons programme by channelising at least US$2.5 billion in illicit payments through hundreds of front companies.
The 33 defendants indicted include executives of North Korea’s state-owned Foreign Trade Bank, which in 2013 was added to a Treasury Department list of sanctioned institutions for transactions that facilitated the nuclear proliferation network, and cut off from the US financial system.
The indictment said the bank officials — one of whom had served in North Korea’s primary intelligence bureau — set up branches in countries around the world, including Thailand, Russia and Kuwait, and used more than 250 front companies to process US dollar payments to further the country’s nuclear proliferation programme.
The defendants used a variety of tactics to cover their tracks, including coded conversations; listing false destinations and customers on contracts and invoices; and creating new front companies after the banks caught onto the association with North Korea, the indictment says. Banks were routinely tricked into processing transactions they wouldn’t have ordinarily done, said prosecutors.
Five of the defendants are Chinese citizens who operated covert branches in either China or Libya. Others who were charged include individuals who served at times as the bank’s president or vice president.
“Through this indictment, the United States has signified its commitment to hampering North Korea’s ability to illegally access the US financial system and (to limiting) its ability to use proceeds from illicit actions to enhance its illegal WMD and ballistic missile programmes,” acting US Attorney Michael Sherwin for the District of Columbia said in a statement.
The US has frozen and seized about US$63 million from the scheme since 2015, according to the indictment.
The case was filed at a time of delicate relations between the US and North Korea. The rapprochement that President Donald Trump has tried to engineer over the past two years has stalled badly, with the last face-to-face meeting between senior officials from the two countries taking place in October in Stockholm.
This indictment also reflects ongoing concerns about sanctions violations related to North Korea. Last month, United Nations experts recommended blacklisting 14 vessels for violating sanctions against North Korea, accusing the country in a report of increasing illegal coal exports and imports of petroleum products and continuing with cyber attacks on financial institutions and cryptocurrency exchanges to gain illicit revenue.
It was not immediately clear whether any of the defendants had lawyers.
