U.S. sanctions, charges Chinese network linked to North Korea WMD trade
Sanctions come as embattled conglomerate accused of "serious economic crimes" by PRC authorities
The United States government has issued designations and unsealed charges against a Chinese company and affiliated individuals linked to illicit trade with North Korea, according to official press releases issued on Monday.
The Treasury’s Office of Foreign Assets Control (OFAC) designated Dandong HongXiang Industrial Development Co. Ltd. (DHID) and four senior managers under Executive Order (E.O.) 13382, which targets WMD proliferators.
The Department of Justice (DOJ) indicted the same four individuals for “conspiring to evade U.S. economic sanctions and violating the Weapons of Mass Destruction Proliferators Sanctions Regulations (WMDPSR).”
The individuals were identified as being DHID’s Deputy General Manager Jinhua Hong, General Manager Jianshu Zhou, Financial Manager Chuanxu Luo and the company’s high-profile Director, Xiaohong Ma.
The DOJ alleges that DHID, in their dealings with North Korea, used offshore front companies to conduct U.S. dollar financial transactions through the U.S. banking system. This involved the Korea Kwangson Banking Corporation (KKBC), an entity sanctioned by both the U.S. and the United Nations Security Council.
“These sales transactions were allegedly financed or guaranteed by KKBC. These front companies facilitated the financial transactions to hide KKBC’s presence from correspondent banks in the United States, according to the allegations in the complaints,” the DOJ press release reads.
The complaint identifies the period of activity to have occurred between August 2009 and September 2015. It is also noted that the complaint is an allegation and that those mentioned are presumed innocent until proven guilty.
The complaint identifies the period of activity to have occurred between August 2009 and September 2015. It is also noted that the complaint is an allegation and that those mentioned are presumed innocent until proven guilty.
Despite this, the DOJ has issued a civil forfeiture of funds within 25 Chinese bank accounts they believe to belong to DHID and its network of front companies.
“The charges unsealed today reflect our nation’s commitment to using all tools to deter and disrupt weapons of mass destruction proliferators,” Assistant Attorney General Carlin was quoted in the press release as saying.
Adam J. Szubin, acting Under Secretary for Terrorism and Financial Intelligence, said the designations also expose a “key illicit network supporting North Korea’s weapons proliferation”.
Authorities in northeast China last week announced that the conglomerate, which is based in Dandong, was under investigation for “serious economic crimes”, but did not say whether the inquiry was related to DHID’s alleged business with North Korea.
DHID was the subject of a recent investigative report published by the ASAN Institute and C4ADS, which shows a detailed network of affiliated companies involved in high levels of trade with North Korea.
The report claimed that the company had assisted in the development of centrifuges for uranium enrichment by supplying Pyongyang with aluminum ingots, ammonium paratungstate, aluminum oxide and tungsten trioxide.
Photo credit: Wikimedia Commons
Featured Image: Dandong, Liaoning Province by Prince Roy on 2007-10-20 14:38:21
