U.S. Citizen Who Conspired in Evading Sanctions Sentenced to Over Five Years and Fined $100,000

A U.S. citizen who conspired to provide services to the Democratic People’s Republic of Korea (DPRK or North Korea), including technical advice on using cryptocurrency and blockchain technology to evade sanctions, was sentenced to 63 months in prison after pleading guilty to conspiracy to violate the International Emergency Economic Powers Act (IEEPA).

According to court documents, Virgil Griffith, 39, began formulating plans as early as 2018 to provide services to individuals in the DPRK by developing and funding cryptocurrency infrastructure there, including to mine cryptocurrency. Griffith knew that the DPRK could use these services to evade and avoid U.S. sanctions, and to fund its nuclear weapons program and other illicit activities.

Pursuant to the IEEPA and Executive Order 13466, U.S. persons are prohibited from exporting any goods, services or technology to the DPRK without a license from the Department of the Treasury, Office of Foreign Assets Control (OFAC).

In April 2019, Griffith traveled to the DPRK to attend and present at the “Pyongyang Blockchain and Cryptocurrency Conference” (the DPRK Cryptocurrency Conference). Even though the Department of State had denied Griffith permission to travel to the DPRK, Griffith delivered presentations at the DPRK Cryptocurrency Conference, tailored to the DPRK audience, knowing that doing so violated sanctions against the DPRK.

At the DPRK Cryptocurrency Conference, Griffith and his co-conspirators provided instruction on how the DPRK could use blockchain and cryptocurrency technology to launder money and evade sanctions. Griffith’s presentations at the DPRK Cryptocurrency Conference had been approved by DPRK officials and focused on, among other things, how blockchain technology such as “smart contracts” could be used to benefit the DPRK, including in nuclear weapons negotiations with the United States. Griffith and his co-conspirators also answered specific questions about blockchain and cryptocurrency technologies for the DPRK audience, including individuals whom Griffith understood worked for the North Korean government.

After the DPRK Cryptocurrency Conference, Griffith pursued plans to facilitate the exchange of cryptocurrency between the DPRK and South Korea, despite knowing that assisting with such an exchange would violate sanctions against the DPRK. Griffith also attempted to recruit other U.S. citizens to travel to North Korea and provide similar services to DPRK persons and attempted to broker introductions for the DPRK to other cryptocurrency and blockchain service providers. At no time did Griffith obtain permission from OFAC to provide goods, services or technology to the DPRK.

Assistant Attorney General Matthew G. Olsen of the Justice Department’s National Security Division and U.S. Attorney Damian Williams for the Southern District of New York made the announcement.

The FBI’s New York Field Office investigated the case, with valuable assistance provided by the National Security Division’s Counterintelligence and Export Control Section, the Justice Department’s Office of International Affairs, and the Singapore Police Force.

Assistant U.S. Attorneys Kimberly Ravener and Kyle A. Wirshba for the Southern District of New York and Trial Attorney Matthew J. McKenzie of the National Security Division’s Counterintelligence and Export Control Section are prosecuting the case.

Article credit: https://www.justice.gov/opa/pr/us-citizen-who-conspired-assist-north-korea-evading-sanctions-sentenced-over-five-years-and