US charges North Korean bank official over crypto laundering

The United States has charged a North Korean bank official over his alleged involvement in laundering cryptocurrency stolen on behalf of Pyongyang.

Sim Hyon Sop, a representative of the North Korean Foreign Trade Bank, is suspected of conspiring with cryptocurrency traders to use stolen funds to buy goods for North Korea, the US Department of Justice said in a statement on Monday.

Sim, 39, is also charged with conspiring with North Korean IT workers to generate revenue through illegal employment at blockchain firms in the US, the department said.

“The charges announced today respond to innovative attempts by North Korean operatives to evade sanctions by exploiting the technological features of virtual assets to facilitate payments and profits and targeting virtual currency companies for theft,” Assistant Attorney General Kenneth A Polite, Jr said.

“We will continue to work to disrupt and deter North Korean actors and those who aid them by following the money on the blockchain and shining a light on their conduct,” he said.

Wu Huihui, a Chinese national who is named in court documents as a co-conspirator in the money laundering scheme, was also charged with operating an unlicensed money transmitting business.

Neither man is likely to face trial in the near future as China and North Korea do not typically extradite criminal suspects to the US.

Separately, the US Department of Treasury announced sanctions against Sim, Wu and Cheng Hung Man, a Hong Kong passport holder, for providing support to Pyongyang through “illicit financing and malicious cyber activity.”

“The DPRK’s use of illicit facilitation networks to access the international financial system and generate revenue using virtual currency for the regime’s unlawful weapons of mass destruction (WMD) and ballistic missile programs directly threatens international security,” Under Secretary of the Treasury for Terrorism and Financial Intelligence Brian E Nelson said in a statement, referring to the acronym for the Democratic People’s Republic of Korea, North Korea’s official name.

“The United States and our partners are committed to safeguarding the international financial system and preventing its use in the DPRK’s destabilising activities, especially in light of the DPRK’s three launches of intercontinental ballistic missiles (ICBMs) this year alone.”

Under leader Kim Jong Un, North Korea has accelerated its development of nuclear weapons and missiles despite international sanctions and censure and last year declared its status as a nuclear-armed state as “irreversible”.

Sanctions monitors have said Pyongyang has carried out numerous cyber thefts to fund its nuclear and missile programmes.

North Korea stole a record $630m to $1bn worth of virtual assets in 2022, according to an annual report submitted to the UN Security Council last month.