US Cracks Down: Sanctions Unleashed on Russian Entities for Secret North Korea Deals
The U.S. government has imposed sanctions on five Russian companies and one Russian national for their involvement in illegal financial transactions between North Korea and Russia. It emphasized that it is seriously concerned about the deepening of illegal financial cooperation between Russia and North Korea. Reporter Lee Jo-eun reports.
The U.S. government has imposed sanctions to block illicit financial transactions between North Korea and Russia.
The U.S. Treasury Department’s Office of Foreign Assets Control announced in a press release on the 19th that it had sanctioned five Russian companies and one Russian national for providing funds to develop North Korea’s weapons of mass destruction and ballistic missile programs in violation of UN Security Council resolutions and supporting Russia’s war in Ukraine.
“Providing funds to North Korea’s WMD and ballistic missile programs”
The sanctions target MRB Bank in South Ossetia, Georgia, Moscow-based Stroitrade, Timer Bank, RFC Bank, TSMR Bank, and TSMR Bank’s vice president Dmitry Yuryevich Nikulin.
According to the Treasury Department, MRB Bank served as a conduit for North Korea’s Foreign Trade Bank and TSMR Bank, which are subject to U.S. and U.N. sanctions, to establish secret banking relationships.
Nikulin, Vice President of TSMR Bank, helped to deposit cash from the Foreign Trade Bank of Korea to MRB Bank through TSMR Bank.
We also organized the opening of agency accounts for the Foreign Trade Bank of Korea and the North Korean Kwangson Bank, cooperating with the North Korean side to enable millions of dollars and rubles to be transferred to the Foreign Trade Bank of Korea and the Kwangson Bank of Korea.
The Treasury Department specifically noted that “at least some of the North Korean accounts at MRB Bank were used to pay for fuel exports from Russia to North Korea.”
[재무부] “TSMRBank vice president Dmitry Yuryevich Nikulin (Nikulin) facilitated cash deposits from FTB through TSMRBank to MRB. Nikulin organized the opening of correspondent accounts for FTB and KKBC at MRB and coordinated with DPRK representatives to ensure the delivery of millions of dollars and rubles in banknotes to FTB and KKBC accounts at MRB. At least some of the DPRK accounts at MRB were used to pay for fuel exports from Russia to the DPRK.”
According to the Treasury, RFC Bank, in cooperation with the Foreign Trade Bank of Korea, established Stroitrade to receive North Korean funds frozen in closed Russian banks.
Also, Timer Bank, owned by RFC Bank, transferred millions of dollars worth of funds to Stroitrade for the Foreign Trade Bank of Korea.
[재무부] “The U.S.-designated Russian Financial Corporation Bank JSC (RFC), worked with FTB to establish a Moscow-based company, Stroytreyd LLC (Stroytreyd), to receive frozen DPRK funds held in defunct Russian banks. As a part of this effort to repatriate frozen assets to the DPRK, RFC-owned Timer Bank, AO (Timer Bank) transferred funds worth millions of dollars to Stroytreyd that were for the ultimate benefit of FTB.”
“Serious concerns over deepening North Korea-Russia illicit financial cooperation”
These sanctions are based on targeted financial sanctions under UN Security Council Resolution 1718 and the prohibition of business relations with North Korean banks under Resolution 2270.
Additionally, the sanctions target the US President’s Executive Order 13382, which aims to prevent the proliferation of weapons of mass destruction.
Sanctioned individuals are blocked from accessing and transacting with any property within the United States.
“Today’s action demonstrates our grave concerns about efforts by Russia and North Korea to deepen financial cooperation in violation of U.N. Security Council resolutions,” Bradley Smith, acting undersecretary for Terrorism and Financial Intelligence, said in a news release.
[스미스 차관 대행] “Today’s action underscores our significant concern with efforts by Russia and the DPRK to deepen financial cooperation, in violation of UN Security Council resolutions. The United States remains strongly committed to leveraging all our available tools to disrupt this and other schemes intended to support Russia’s war of aggression against Ukraine and enable the DPRK’s illicit access to the international financial system.”
“The United States remains committed to using every tool at its disposal to support Russia’s war of aggression against Ukraine and to disrupt any plans to enable North Korea’s illicit access to the international financial system,” he continued.
The State Department said in a press release on the same day under the name of Spokesperson Matthew Miller that “this action is intended to expose and disrupt the network that facilitates the financing of North Korea’s illicit weapons of mass destruction and ballistic missile programs and supports Russia’s illegal war in Ukraine.”
[밀러 대변인] “This action exposes and disrupts networks that facilitate the funding of the DPRK’s unlawful weapons of mass destruction and ballistic missile programs and that support Russia’s illegal war against Ukraine. The growing financial cooperation between Russia and the Democratic People’s Republic of Korea (DPRK) directly threatens international security and the global financial system.”
He also stressed that “increased financial cooperation between Russia and North Korea directly threatens international security and the international financial system.”
“Bank sanctions more effective than individual sanctions”
Dennis Wilder, former White House Senior Advisor for Asia
Dennis Wilder, former White House senior adviser for Asia, praised the Treasury Department’s recent sanctions against Russian financial institutions that helped North Korea access the international financial system, saying in a phone call with VOA on the 19th, “Measures like sanctions on banks are more effective than sanctions on individuals.”
The explanation is that many of the existing sanctions against individuals are largely symbolic and have had little real effect, as most of the individuals targeted by the sanctions have no assets in the United States and no intention of coming to the United States.
[녹취:와일더 전 선임보좌관] “The sanctioning of banks and those kinds of things is more effective than the sanctioning necessarily of individuals because our sanctioning of individuals, most of these individuals have no funds in the United States, they have no intention to come to the United States and therefore a lot of the old sanctions we have on have been very symbolic sanctions with little effect. Now the attempt to deal with banking, that has more effect… I think you’ll see the US using this more and more…These relationships are clearly much closer than many people thought… I think what we will see is a step up in these kinds of sanctions to slow down these relationships.”
He added that “relationships between Russia and North Korea have become much closer than many people thought,” and that sanctions aimed at curbing such relations, especially related financial sanctions, are expected to be strengthened.
North Korea and Russia are deepening cooperation between the two countries in the wake of the war in Ukraine.
Despite concrete evidence from the international community regarding North Korea’s arms supply to Russia, particularly to support the war in Ukraine, both countries deny the arms deal.
VOA has reached out to North Korea’s and Russia’s missions to the United Nations for comment on the sanctions and is awaiting responses.
This is Lee Jo-eun from VOA News.