North Korea is well known for its mass destruction of international security and its involvement in cybercrime. In what is just the latest development, the U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC) has added three individuals to its list of those who have helped North Korea covert stolen cryptocurrency into fiat currency. These individuals, Wu Huihui, Cheng Hung Mana, and Sim Hyon Sop have been accused of providing essential material support to the North Korea-based Lazarus hacking group.

North Korea’s $1.7 Billion Virtual Currency to Fund WMD

The North Korean regime has illicitly gained $1.7 billion in virtual currency, which is being used to fund its weapons of mass destruction (WMD) and ballistic missile programs.

This has been made possible by the assistance given to the Lazarus group by Wu, Cheng, and Sim, which has been deemed a direct threat to international security by the Under Secretary of the Treasury, Brian E. Nelson.

North Korea has already launched three intercontinental ballistic missiles this year and could launch more if a new source of financing is not found.

Accusations of Money Laundering

Three individuals, Wu Huihui, Cheng Hung Mana, and Sim Hyon Sop, have been accused of using networks of North Korean and Chinese over-the-counter traders (OTC) to launder stolen funds and provide material assistance to the Lazarus group.

Sim Hyon Sop is said to have acted on behalf of Korea Kwangson Banking Corp, which allegedly provides financial services to entities conducting WMD activity. The trio is accused of using these networks to conceal the origin of the stolen funds and facilitate money laundering.

The Treasury’s Response

The Treasury has issued a warning to financial institutions to not provide ”significant financial services” to three individuals linked to North Korea’s money laundering activities. All of their property and interests must be blocked, and any financial institution that knowingly provides services to them could be added to the sanctions list. This is a strong reminder to financial institutions to not engage in activities that help the North Korean regime launder money.

The Treasury is clearly taking the steps necessary to prevent the North Korean regime from engaging in mass destruction activities, but it’s still important for financial institutions to be aware of the risk of sanctions if they are found to be aiding and abetting in any way. All financial institutions should make sure that they have strict regulations in place to identify any suspicious activities which could risk falling foul of OFAC sanctions.

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The post North Korea’s Weapons of Mass Destruction: Financial Institutions Risk Sanctions for Aiding Cryptocurrency Conversion appeared first on Boxmining.

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Filed under: Bitcoin - @ April 25, 2023 5:32 am