For the first time, the South Korean and U.S. governments have launched simultaneous sanctions against people related to North Korea’s cyber sector.
On the 24th (local time), the Ministry of Foreign Affairs and the U.S. Treasury announced that they had placed Sim Hyun-seop (40), deputy head of Chosun Kwangseon Bank, a state-run bank in North Korea, on their own list of sanctions.
In a press release announcing sanctions against Sim Hyun-seop and others, Brian Nelson, director of the U.S. Treasury Department’s terrorism and financial intelligence division, said, “North Korea is illegally accessing the international financial system and using cryptocurrency to fund development of weapons of mass destruction (WMD) and ballistic missiles.” “In particular, North Korea has launched three intercontinental ballistic missiles (ICBMs) this year alone,” he pointed out.
The U.S. Treasury Department said Shim Hyun-seop, vice president of Chosun Kwangseon Bank in Dandong, Liaoning Province, China, bordering North Korea, directed the illegal currency exchange. Chosun Kwangseon Bank is under the Chosun Trade Bank, which oversees North Korea’s external financial affairs, and both institutions are subject to sanctions by the UN Security Council.
Since September 2019, Sim Hyun-seop has received wages from thousands of North Korean agents who worked as developers at American IT (information and communication) companies overseas by deceiving their identities and receiving tens of millions of dollars worth of virtual currency remittances. He also had two over-the-counter (OTC) virtual currency traders working in China exchange virtual currency stolen by the North Korean hacking organization ‘Lazarus’.
These traders, both Chinese and Chinese-British, used a front company in 2021 to turn millions of dollars worth of cryptocurrency stolen by Lazarus into real money. The two were also subject to U.S. Treasury Department sanctions. The Ministry of Finance said, “North Korea is exchanging virtual currencies through OTC virtual currency traders operating in China and elsewhere to avoid surveillance by financial authorities.”
Disguised employment in the IT industry is a new foreign currency earning strategy in North Korea. In December of last year, the Ministry of Foreign Affairs said, “North Korean IT personnel are earning hundreds of millions of dollars in foreign currency each year after disguising their identities abroad. The U.S. Treasury Department also advised in May of last year to beware of North Korean IT workers undercover employment.
According to Chainalysis, a New York blockchain analysis company, it is estimated that hacker organizations linked to North Korea such as Lazarus stole $1.65 billion (about 2.3 trillion won) worth of virtual currency last year. It nearly quadrupled from $428.8 million in 2021.
Source: Donga
Mark Jones is a world traveler and journalist for News Rebeat. With a curious mind and a love of adventure, Mark brings a unique perspective to the latest global events and provides in-depth and thought-provoking coverage of the world at large.