U.S. Charges North Korean Banker With Crypto Laundering

A U.S. court charged a China-based representative of North Korea’s Foreign Trade Bank with two counts related to laundering illicit crypto proceeds for the benefit of the North Korean nuclear weapons and ballistic missile program, according to a statement by the U.S. Attorney’s Office.

Sim Hyon Sop, a 39-year-old North Korean national, is accused of conspiring with traders in China to launder cryptocurrency stolen by North Korea’s hackers by purchasing goods through Hong Kong-based front companies.

The second indictment alleges that Sim managed a scheme laundering proceeds from the work of various North Korean IT specialists, who under fake identities gained employment at U.S. crypto companies to seek revenues for the North Korean regime.

Since September 2021, Sim has allegedly received tens of millions of dollars worth of virtual currency.

“The charges announced today highlight the ways in which North Korean operatives have innovated their approach to evading sanctions by exploiting the technological features of virtual assets to facilitate payments and profits and targeting virtual currency companies for theft,” said Assistant Attorney General Kenneth Polite of the Justice Department’s Criminal Division.

Sim’s crypto-laundering network included Wu Huihui, a Chinese trader residing in the city of Jinan located around 400 kilometers south of Beijing, Hong Kong-based trader Cheng Hung Man, and an unknown user of the online moniker “Live:jammychen0150”.

Sim directed the illicit crypto proceeds to “Live:jammychen015”, who then recruited Wu and Cheng. Wu and Cheng helped to find sham companies to facilitate the payments in the scheme and avoid U.S. sanctions against North Korea.

Wu was charged separately for operating an unlicensed money-transmitting business through a U.S.-based virtual currency exchange.

In a concurrent action, the U.S. Treasury introduced sanctions against Sim, Wu, and Cheng for providing support to North Korea through “illicit financing and malicious cyber activity.”

Money laundering is punishable by up to 20 years in prison in the U.S., but neither Sim nor Wu is likely to face trial as the U.S. does not have an extradition treaty with China.

North Korea operates a sizable hacker army, which has in recent years become increasingly proficient in crypto theft. In 2022 alone, North Korean hackers reportedly stole an estimated $1.7 billion worth of cryptocurrency.

Article Credit: https://www.occrp.org/en/daily/17552-u-s-charges-north-korean-banker-with-crypto-laundering