Why in News
United States Department of Justice, in an indictment’ said that North Koreans and Chinese citizens are operating a multibillion-dollar money laundering scheme to help fund the North’s nuclear weapons program.
The department charged 28 North Koreans and five Chinese citizens of money laundering and sending that money back to North Korea
The department charged 28 North Koreans and 5 Chinese citizens of using a network of more than 250 shell companies to launder over $2.5 billion in assets through the international banking system.
The money flowed back to North Korea’s primary, state-operated foreign exchange bank, the Foreign Trade Bank of the Democratic People’s Republic of Korea.
USA and UN imposed economic sanctions on North Korea after the first nuclear test performed by it in 2006. Policy of economic sanctions proved counter productive and North Korea conducted further nuclear tests in 2209, 2013, 2016 and 2017.
Obama administration tightened economic sanctions up to the cutting petroleum and other essential goods supply to North Korea to force North to give up its nuclear programme.
North Escaping Sanctions
North Korea is accustomed to improvising, to finding new ways to get around economic sanctions put in place by UN and USA.
Prior to this incident North used cyber attacks carried out by army of skilled hackers and crypto currency to escape economic sanctions and route money to North Korea.
Money Stolen Through Cyber Attacks
The state sponsored cyber hackers of North Korea has been attacking banks in all part of the world to steal money from them.
2015 attack on the Central Bank of Bangladesh where the stole $81 million. 2018 attack on India’s Cosmos Bank to steal $13.5 million and 2019 attack on Bank of Chile’s ATM network to siphon off $10 million are recent examples of money stealing by North hackers.
Trump Administration’s Failure
Trump administration has failed in discouraging the North from carrying out its nuclear programme.
The economic sanctions proved counterproductive and US failed to isolate North Korea from international financial system.
US efforts to reconcile North Korea by two summit level meetings between Trump and Kim Jong Un have not been able to break the ice.
New “Name and Shame” Strategy
US, the world’s most powerful country, is now resorting to “naming and shaming” is a surprising indication of just how difficult it has been for the international community to cut off North Korea’s income streams.
The US hopes that publicly naming the individuals and entities involved will lead financial institutions to refuse to work with them, freezing them out of global financial networks and making it impossible, or much more difficult, to earn money.
North Korea launder money to fund nuclear weapons program North Korea launder money to fund nuclear weapons program