The U.S. Department of Justice announced the indictment of a representative of the North Korean Foreign Trade Bank for participating in schemes to launder money using cryptocurrencies in order to benefit the Democratic People's Republic of Korea.
A representative of the North Korean Foreign Trade Bank is named in two federal charges that were unsealed today in the District of Columbia, according to an April 24 news release. A third indictment accuses one of the conspirators of participating in a different plot.
“Today’s indictments reveal North Korea’s continued use of various means to circumvent U.S. sanctions. We can and will ‘follow the money,’ be it through cryptocurrency or the traditional banking system, to bring appropriate charges against those who would help to fund this corrupt regime,” Attorney Mathew Graves said in the release.
Sim Hyon Sop, a citizen of North Korea, is accused of plotting to launder stolen cryptocurrency and use the money to buy goods through front companies based in Hong Kong for the benefit of North Korea, the release reported. The other two over-the-counter traders are Cheng Hung Man, a British national living in Hong Kong, and Wu HuiHui, a Chinese national.
These payments, which were made in U.S. dollars, were controlled by Sim through Chen, according to the release. Chen then hired Wu and Cheng to locate phony front firms and handle the payments in order to get around U.S. sanctions against North Korea.
According to the second indictment, Sim conspired with a number of North Korean IT professionals to launder the earnings from illegal IT development activities, the release said. In defiance of United Nations and Department of the Treasury Office of Foreign Assets Control restrictions against North Korea, the IT workers obtained employment at American crypto companies using false identities and laundered their illicit proceeds through Sim for the benefit of the North Korean regime.
These restrictions were put in place to obstruct North Korea's efforts to manufacture ballistic missiles, produce weapons and conduct research and development, the release reported.
All three men have been charged with conspiracy to commit money laundering and conspiracy to operate an unlicensed money transmitting business, the release said. If convicted, they face up to 20 years in prison for each count.
The U.S. government has been cracking down on crypto-based money laundering schemes in recent years, particularly those tied to North Korea, which has been under a range of economic sanctions for years due to its nuclear and ballistic missile programs, according to the release.