British American Tobacco, North Korea, & the Bomb: Setting a New Low for How Evil a Tobacco Company Can Be

Last Tuesday, British American Tobacco, the world’s second-largest tobacco company, along with its Singaporean subsidiary, pled guilty to bank fraud and conspiracy charges and agreed to pay a combined $635 million in criminal and civil fines, penalties, and forfeitures to the Treasury and Justice Departments. The charges arise from an secret joint venture, going all the way back to 2001, in which BAT sold the North Korean government tobacco, other materials, machinery, and technical help to manufacture cigarettes, despite having said...

Money Laundering/NK Crime/U.S. Law

April 4, 2023

The Root of All Evil: Money, Rice, Crime & Law in North Korea

In 1997, a Washington Post reporter was allowed into the city of Hamheung, in the mountains that ring North Korea’s east coast, to investigate reports of a famine in the isolated country. There, he interviewed the director of a local orphanage, who told him that some parents who could no longer feed their children had begun to abandon them “to nature.” Some of these children died where their parents left them. In other cases, people would bring them to the...

Human Rights/Sanctions/U.S. Law

August 22, 2022

No, North Korea did not “manage” COVID. It piled famine on plague.

The editors of 38 North are smart, well-informed people, and so I’m puzzled by their decision to publish this submission by Heeje Lee and Samuel S. Han, a dentist and a research assistant, declaring Kim Jong-un’s victory over COVID. Unlike the usual suspects, Lee and Han don’t avoid all criticism of the North Korean system, its leaders, or its policies. They acknowledge “the weak state of the country’s health care system,” concede its widespread malnutrition, and lack of a COVID...

Famine & Food Aid/Fiskings/Health & Disease

August 18, 2022

How sanctions helped bring down the Soviet Bloc

Among sanctions critics who oppose America’s foreign policy goals or sympathize with its adversaries, a common cliche is that “sanctions never work.” A more nuanced criticism from skeptics of American power is that sanctions alone cannot cause states to change the policies that Washington and its allies oppose. A third argument is that sanctions are not an end unto themselves. The first argument is demonstrably untrue; the second is a half-truth; and the third is too self-evident to be worth...

Europe/History/Sanctions

July 19, 2022

The U.S. & South Korea should enforce existing sanctions against North Korea, not bargain for new ones

Between 2017 and 2022, the leaders of the United States and South Korea performed an experiment: what if they froze joint military exercises, said nothing about Kim Jong-un’s crimes against humanity, offered aid, and stopped actively enforcing sanctions? The results of the experiment are in. This week, Treasury Secretary Yellen is in Seoul, where she met with President Yoon to discuss, among other items, what each of the two government should do about Kim Jong-un’s increased missile tests, and the...

An Alliance?/Money Laundering/Sanctions/U.S. Law

January 2, 2022

How Uygur and North Korea human rights activists can join forces to keep slave-made goods out of your closet

How many things do you own that were made by slaves—specifically, enslaved North Koreans or Uygurs? The bad news is that no one knows, because most of the evidence is hidden deep within the supply chains. The good news is that this may be changing just enough to make the use of slave labor unprofitable for the retailers you buy from and the sweatshops in China that employ it. “Royal Blood-Fresh” Chinese manufacturers have a long history of sourcing their...

Activism/Human Trafficking/Kaesong/Sanctions

October 3, 2021

Selling Slavery: South Korean investors’ $900,000 Kaesong lobbying campaign

Documents filed with the Justice Department in July show that a group of South Korean investors hired a San Francisco law firm and a South Korean consulting firm to lobby the U.S. government to support reopening a shuttered, looted, and partially exploded manufacturing complex near Kaesong, North Korea. The documents were required to be filed with the Justice Department and made public under the Foreign Agents Registration Act of 1938 (FARA), a law designed to expose foreign propaganda and influence...

Kaesong/U.S. & Korea/U.S. Law

March 23, 2021

For the first time, the Justice Department extradites a North Korean to stand trial in the U.S.

Today, the Justice Department announced that for the first time, it has extradited a North Korean national to the United States. Mun Chol Myong, who was based in Malaysia, and whom DOJ claims to be an agent of the Reconnaissance General Bureau, allegedly laundered money through the United States to do deals between the Foreign Trade Bank of North Korea (designated in 2013 for WMD proliferation financing), the military electronics manufacturer, Glocom, and other wholesome types. Funny, no mention of...

Luxury Goods/Money Laundering/Southeast Asia/U.S. Law

July 23, 2020

You can’t blame Donald Trump for filling Moon Jae-in’s cabinet with pro-Pyongyang ex-terrorists

Yesterday morning, I was surprised to learn that my tweets about Lee In-young’s master plan to get around sanctions and bail out Kim Jong-un made the Chosun Ilbo and are spreading around Korean YouTube. Because you hate reading long posts—even long posts that you really should read—I decided to hold back for today my examination of why Lee and his colleagues are so motivated to aid and abet Pyongyang’s sanctions-busting, and all of its plans for Seoul’s money. We might...

An Alliance?/Anti-Americanism/The Fifth Column

July 21, 2020

Our S Korean ally has a plan to bail Kim Jong-un out, but it’s no better than the rest of them

I really think South Korean President Moon Jae-in wants to bail Kim Jong-un out more than I want my next breath. Even before he was sworn in, he called for the reopening of Kaesong and other joint projects to ease the burden of U.S.-led sanctions. Once in office, he called for major investments in North Korea until a call from the Treasury Department scared his bankers away. He turned a blind eye to purchases of North Korean coal, and probably to the smuggling of luxury goods, into...

An Alliance?/Sanctions

July 17, 2020

Why DOJ’s deferred prosecution of Essentra FZE is a good deal for it, & for us.

In the Washington suburbs, $665,112 will buy you a nice house, but not a mansion. A settlement with the Treasury Department for a civil penalty in that amount isn’t going to bankrupt a large multinational corporation. Its main impact on Essentra FZE, a UAE-based subsidiary of a British corporation that makes cigarette filters, may be in its access to financial services and legal fees, which would still be worth every penny if they exceeded the penalty. You could argue back...

Money Laundering/U.S. Law

June 8, 2020

The N.Y. Times, the Ningpo 12, Minbyun & Yoon Mee-hyang: The Story Behind the Story

Warning: This one is a long read. There are a lot of threads to pull together. In the end, I believe the implications for South Korea’s democracy, the human rights of North Koreans, and the accuracy of the news you read are grave enough to justify the effort to write (and hopefully, to read) it. ~ ~ ~ Since the announcement of their group defection in April 2016, this blog has paid close attention to the case of the Ningpo...

Defectors/Human Trafficking/Korean War II/Media Criticism/Refugees/Subversion/The Fifth Column

May 28, 2020

Feds unseal 14-count indictment against 33 agents of sanctioned North Korean bank

The U.S. Attorney’s office for the District of Columbia has done it again. Today, its prosecutors unsealed indictments against 28 North Korean and 5 Chinese representatives of North Korea’s Foreign Trade Bank (FTB) who are or were posted in China, Russia, Libya, Thailand, Kuwait, and Austria. The Treasury Department’s Office of Foreign Asset Control (OFAC) designated the FTB for proliferation financing in 2013. The North Korea Sanctions Regulations later put additional restrictions on dealings with the North Korean financial industry....

Money Laundering/Sanctions/U.S. Law

May 27, 2020

Tim Shorrock spreads disinformation about biological warfare in Korea. That makes him a disinformant.

If you’re unfamiliar with self-described Marxist and journalist Tim Shorrock, consider yourself fortunate. But if you’re on Twitter and you’re interested in Korea, you’ve probably run across his tweets. You might even have been blocked by him. And while the world is wide enough for all sorts of kooky viewpoints (as Mao said, “Let a hundred flowers bloom,” as he pulled the cord and started his lawnmower), Shorrock was one of the first “journalists” to whom Moon Jae-in gave an...

Propaganda/Useful Idiocy

May 13, 2020

OFAC’s new North Korea (sort of) designations

Today, the Treasury Department’s Office of Foreign Assets Control published a colossal list of amendments to the North Korea designations on its list of Specially Designated Nationals—its sanctions blacklist for the financial industry. The amendments are requirements under the new Otto Warmbier North Korea Nuclear Sanctions and Enforcement Act, the North Korea Sanctions and Policy Enhancement Act, and the regulations promulgated under those authorities. Today’s announcement is an encouraging sign that the administration is feeling more pressure to enforce these...

Cyberwar/Money Laundering/Sanctions/Shipping sanctions

April 14, 2020

On OFAC’s new North Korea Sanctions regulations

In the days since the Treasury Department announced its amendment to the North Korea sanctions regulations at 31 CFR Part 510, I’ve received at least half a dozen inquiries from journalists about what it means. Unfortunately for us all, today also marks the first day in almost three weeks, inclusive of weekends and holidays, that I did not work a significant amount overtime in my day job—currently, it involves responding to the nationwide coronavirus disaster declaration—so I’ll keep this post...

Arms Trafficking/Money Laundering/Sanctions/Shipping sanctions/U.S. Law

March 2, 2020

DOJ indicts 2 Chinese men for laundering stolen South Korean Bitcoin for North Korean hackers

Today, the U.S. Attorney’s Office for the District of Columbia unsealed an indictment of two Chinese nationals, Tian Yinyin and Li Jiadong, charging them with money laundering and running an unlicensed money transmitting business, for laundering $100 million in stolen Bitcoin and Ether for North Korean hackers between July 2018 and April 2019. The indictment alleges that the $100 million was part of a $250 million take the Lazarus Group stole from four cryptocurrency exchanges, three of them in South...

Cyberwar/Money Laundering/U.S. Law

February 14, 2020

Huawei & North Korea: Reading between the lines of EDNY’s new indictment

HUAWEI, WHICH WAS PREVIOUSLY INDICTED FOR eleven counts of conspiracy, bank fraud, wire fraud, violations of Iran sanctions, and money laundering (plus criminal forfeiture counts) now finds itself hit with a superseding indictment for sixteen counts of similar allegations by prosecutors in the Eastern District of New York, or EDNY. I’ve always been impressed with the quality of EDNY’s work. It’s a plucky, underrated little office that sits resentfully in the shadow of its more prestigious and prideful neighbor in...

Money Laundering/U.S. Law