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Category: Shipping sanctions

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...

Categories 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...

Categories Arms Trafficking/Money Laundering/Sanctions/Shipping sanctions/U.S. Law
December 20, 2019

The Warmbier Act could raise the pressure on Kim Jong-un dramatically, whether Donald Trump likes it or not

Kim Jong-un is wrapping Donald Trump’s Christmas present, and Putin and Xi Jinping say that Trump should lift the sanctions on Kim they’ve been violating anyway, but Congress just made those sanctions much tougher in a new bill, the Otto Warmbier North Korea Nuclear Sanctions and Enforcement Act, which just passed both houses of Congress as an amendment to the National Defense Authorization Act for Fiscal Year 2020, or NDAA. The bill is an updated version of the BRINK Act,...

Categories Money Laundering/Sanctions/Shipping sanctions/U.S. Law
May 10, 2019

I’ll give you a topic. The final voyage of the “Wise Honest” was neither. Discuss.

The U.S. Attorney’s Office for the Southern District of New York has seized and sued to forfeit a 17,000-ton North Korean bulk carrier that was hauling neither rice, nor corn, nor milk, but coal to enrich Kim Jong-un, and machinery to keep his mines and his military-industrial complex from shutting down.1 And it was doing it with money laundered through correspondent banks in our country, in New York City. This is the great, uncharged crime of the M/V Wise Honest,...

Categories Money Laundering/Shipping sanctions/U.S. Law
March 13, 2019

UN Panel investigating South Korean sanctions violations

The U.N. Panel of Experts has released its latest report, and for the first time since it began publishing them in 2009, it is now investigating South Korea for violating the sanctions. One area the Panel is looking into is its imports of North Korean coal for ten months, in violation of UNSCR 2371, while its Coast Guard dragged out an “investigation” of those imports, allowed the smuggling ships to come and go freely without seizing them, and later charged...

Categories An Alliance?/Sanctions/Shipping sanctions/Sunshine
August 7, 2018

South Korea implicated in large-scale violations of U.N. coal, shipping sanctions against North Korea

This week, a scandal is burgeoning in South Korea that a wholly owned subsidiary of the nation’s largest power company purchased large quantities of North Korean coal in violation of the coal export ban of UNSCR 2371. The other day, I tweeted about a Korean-language report in the right-leaning site Pennmike, indicating that a Belize-flagged ship carrying North Korean coal was spotted in the port of Pyeongtaek. We’ve since learned that this violation was part of a broader, long-standing, illicit...

Categories Shipping sanctions
March 5, 2018

Hey, I’ve got an idea! Let’s board, search & sink their smuggling ships & show it on TV.

LAST WEEK, REUTERS REPORTED THAT THE WHITE HOUSE is considering a proposal to board and search North Korean merchant ships for contraband on the high seas. This is one of the few forceful options against Pyongyang I could get behind. Unlike “bloody nose” proposals (which sound like they’re an urban myth anyway) and preemptive strike proposals (which exist, at least on the op-ed pages) the boarding of North Korean smuggling ships at sea is unlikely to trigger a sudden use-it-or-lose-it...

Categories Arms Trafficking/Shipping sanctions
February 28, 2018

You want maximum pressure? Oh, I’ll show you maximum pressure.

SINCE LAST WEEK, WHEN THE TREASURY DEPARTMENT announced 56 designations of ships, shipping companies, and trading companies, reporters have been emailing me to ask whether this is finally the “maximum pressure” the Trump administration has been talking about. The short answer is “no.” In terms of length alone, yes, this was the largest set of North Korea designations ever, although we should discount for the fact that most of the 28 ships were effectively designated twice (once per ship, and...

Categories Money Laundering/Sanctions/Shipping sanctions
February 2, 2018

Dandong Delenda Est: A little-noticed law may soon raise the pressure on China over N. Korea’s smuggling

IF OUR CHOICES FOR ADDRESSING THE KOREAN MISSILE CRISIS come down to (a) a trade war with China, or (b) a nuclear war with North Korea, which option is worse? If you still believe that begging Kim Jong-un for another piece of paper he doesn’t want and wouldn’t keep is the answer, no amount of evidence will convince you. To accept Pyongyang’s nuclear status in the mistaken belief that conventional means can deter Kim Jong-un’s campaign to gradually blackmail, censor,...

Categories Sanctions/Shipping sanctions
November 27, 2017

Treasury Dep’t hits Sun Sidong, N. Korea’s maritime smuggling & mineral exports

Here at OFK, we’ve chronicled a curious fact that few professional foreign policy scholars have noticed: China is opposed to unilateral sanctions, except when it isn’t. Last week — barely a week after President Trump returned from Beijing — he gave Xi Jinping something to oppose. OFAC designated Dandong Kehua Economy & Trade Co., Ltd., Dandong Xianghe Trading Co., Ltd., and Dandong Hongda Trade Co. Ltd. pursuant to E.O. 13810. Between January 1, 2013 and August 31, 2017, these three...

Categories Arms Trafficking/Money Laundering/Shipping sanctions
September 21, 2017

Maximum Pressure Watch: Trump puts the squeeze on Kim Jong-un

Donald Trump hit Kim Jong-un with his first sanctions executive order today. (Update: Its official number is Executive Order 13810.) The new EO partially implements UNSCR 2371, UNSCR 2375, and the KIMS Act, which the President signed in August. As a strictly legal matter, this EO will not affect anyone’s interests immediately because Treasury didn’t announce any new designations. As a practical matter, however, we may already be seeing the effects of the clear seriousness of purpose that Trump has...

Categories Money Laundering/Sanctions/Shipping sanctions
July 24, 2017

OFK Exclusive: House, Senate move new North Korea sanctions legislation

Last year, Ed Royce, the Chairman of the House Foreign Affairs Committee, and Cory Gardner, Chairman of the Senate Asia Subcommittee, led the charge to cut Pyongyang’s access to the hard currency that sustains it by drafting and passing the North Korea Sanctions and Policy Enhancement Act. We’ve known all along that nothing short of presenting Kim Jong-Un with an existential choice — disarm and reform, or perish — would create the conditions for a negotiated disarmament of North Korea,...

Categories Arms Trafficking/Money Laundering/Sanctions/Shipping sanctions/U.S. Law
June 13, 2017

C4ADS: Pyongyang’s networks in China are “centralized, limited, and vulnerable” to sanctions 

Because I’ve already given too many minutes of my life to the moveable farce named Dennis Rodman, I’m devoting today’s post to something more consequential: the Center for Advanced Defense Studies’s new report exposing more North Korean financial networks in China, and dispelling the misinformation that North Korea is isolated from the financial system and thus sanctions-proof. (Full disclosure: I advised C4ADS on the drafting of the report, without compensation of course.) Money quote: The continuing misperceptions of North Korea...

Categories China/Money Laundering/Sanctions/Shipping sanctions
June 8, 2017

China is cheating on the North Korea coal import ban (again) (with updates)

Via the indispensable Leo Byrne: Two North Korea-linked ships have arrived at two separate coal terminals in Shanghai since Sunday, while one other was departing the area after having left a third facility at a similar time. Satellite imagery shows that each of the terminals is equipped to handle coal. The UN currently restricts member states from importing North Korean coal, while Beijing has said numerous times that it has suspended all imports for the remainder of 2017. “Imagery indicates...

Categories China/Sanctions/Shipping sanctions
March 14, 2017

Another North Korean ship sinks, this time off the Chinese coast

In an effort to hide their sanctions violations from the prying eyes of the U.N. Panel of Experts — and from Leo Byrne and the sharp-eyed investigators at C4ADS — North Korean ships have taken to turning off the transponders and navigational devices that allow others to know where they are. Now that I’ve explained the advantages of that, let’s talk about one big possible disadvantage: other ships might crash into you and sink you. That’s the best explanation I...

Categories Shipping sanctions
February 27, 2017

Malaysia’s lax enforcement of North Korea sanctions has finally come home

Over the weekend, Malaysian authorities painstakingly decontaminated a terminal of the Kuala Lumpur International Airport where North Korean agents – including a diplomat – carried out a lethal attack with the nerve agent VX, a substance so deadly that a tiny droplet can kill an adult. The authorities are clearly concerned that the use of a persistent chemical weapon of mass destruction in a crowded airport terminal will cause panic among Malaysian citizens and members of the traveling public, as...

Categories Arms Trafficking/Money Laundering/Sanctions/Shipping sanctions/Southeast Asia
February 8, 2017

Leaked U.N. report reveals record seizure of North Korean arms last August (updated)

The 2017 report of the U.N. Panel of Experts isn’t due to be published for another month, but a Kyodo News reporter has already obtained and published leaked excerpts. The focus of Kyodo’s story is the now-familiar (and unquestionably accurate) castigation of member state governments for not putting enough will or resources into the enforcement of North Korea sanctions, but I’d like to start with this revelation: “An interdiction of the vessel Jie Shun was the largest seizure of ammunition...

Categories Arms Trafficking/Shipping sanctions
January 17, 2017

North Korean ship that sank last week may have been used for arms smuggling

A North Korean freighter with the not-entirely-Korean-sounding name of Chong Gen went to the bottom of the Tsushima Strait last week with nearly 5,720 tonnes* of rice aboard. The crew sent a distress signal and took to their lifeboats in time for the Japanese Coast Guard to rescue the entire crew of 26. All are reported safe. Lucky them. Most North Korean ships that have arrived in Japan recently have carried only the dead. Now, I’m no maritime expert, but 26 sounds like a very...

Categories Shipping sanctions