OFAC designates Russian bank and others under DPRK and NPWMD programs

Today, OFAC designated the following person: 

RI, Jong Won (a.k.a. RI, Cho’ng-Wo’n; a.k.a. RI, Jung Won), Moscow, Russia; DOB 22 Apr 1971; Passport PS654320421 expires 11 Mar 2019 (individual) [DPRK2].

and entities: 

COMMERCIAL BANK AGROSOYUZ (Cyrillic: КОММЕРЧЕСКИЙ ВАНК АГРОСОЮЗ) (a.k.a. AGROSOYUZ (Cyrillic: АГРОСОЮЗ); a.k.a. AGROSOYUZ LLC (Cyrillic: АГРОСОЮЗ ООО); a.k.a. LLC COMMERCIAL BANK AGROSOYUZ (Cyrillic: ООО КОММЕРЧЕСКИЙ ВАНК АГРОСОЮЗ; Cyrillic: ООО КВ АГРОСОЮЗ)), Ulanskiy pereulok, number 13 building 1, Moscow 101000, Russia; SWIFT/BIC AGSZRU31; alt. SWIFT/BIC AGSZRU33 [DPRK4]. 
 
KOREA UNGUM CORPORATION (a.k.a. KOREA UNGUM COMPANY), Pyongyang, Korea, North [DPRK3].  

under the North Korean sanctions program And the following entity:  

DANDONG ZHONGSHENG INDUSTRY & TRADE CO., LTD. (Chinese Simplified: 丹东中盛工贸有限公司) (a.k.a. DANDONG ZHONGSENG INDUSTRY & TRADE; a.k.a. DANDONG ZHONGSENG INDUSTRY AND TRADE; a.k.a. DANDONG ZHONGSHENG INDUSTRY AND TRADE CO., LTD.; a.k.a. DANDONG ZHONGSHONG INDUSTRY & TRADE; a.k.a. DANDONG ZHONGSHONG INDUSTRY & TRADE CORPORATION LTD.; a.k.a. DANDONG ZHONGSHONG INDUSTRY AND TRADE; a.k.a. DANDONG ZHONGSHONG INDUSTRY AND TRADE CORPORATION LTD.), Building 34, Chengjian Zone, Shiwei Road, Zhenxing District, Dandong, Liaoning, China; Zhenxing District, Building 34, Dandong, China; Business Registration Number 312106037714354404 (China) [NPWMD] (Linked To: FOREIGN TRADE BANK OF THE DEMOCRATIC PEOPLE’S REPUBLIC OF KOREA). 
 
was designated under the non-proliferation sanctions program.

And the Treasury Department issued the following press release:

Treasury Targets Russian Bank and Other Facilitators of North Korean United Nations Security Council Violations

 
August 3, 2018

WASHINGTON – The U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC) today announced additional sanctions related to North Korea, continuing the enforcement of existing UN and U.S. sanctions.  Today’s action targets a Russian bank for knowingly facilitating a significant transaction on behalf of an individual designated for weapons of mass destruction-related activities in connection with North Korea.  OFAC also targeted one individual and two entities for facilitating North Korean illicit financial activity.  This action reinforces the United States’ ongoing commitments to upholding the decisions of the UN Security Council (UNSC).

“The United States will continue to enforce UN and U.S. sanctions and shut down illicit revenue streams to North Korea.  Our sanctions will remain in place until we have achieved the final, fully-verified denuclearization of North Korea,” said Treasury Secretary Steven Mnuchin. 

As a result of today’s action, any property or interests in property of the designated persons in the possession or control of U.S. persons or within (or transiting) the United States is blocked, and U.S. persons generally are prohibited from dealing with any of the designated persons.

FINANCIAL AND FOREIGN TRADE BANK-AFFILIATED TARGETS

OFAC, pursuant to Section 4 of Executive Order (E.O.) 13810, today sanctioned Russian-registered Agrosoyuz Commercial Bank (Agrosoyuz) for knowingly conducting or facilitating a significant transaction on behalf of Han Jang Su, the Moscow-based chief representative of Foreign Trade Bank (FTB), North Korea’s primary foreign exchange bank.  Pursuant to E.O. 13687, OFAC today designated Ri Jong Won, the Moscow-based deputy representative of FTB.  Both Han Jang Su and FTB were already designated by the United States under E.O. 13382 and by the UNSC Committee established pursuant to Resolution 1718 (2006).  OFAC designated Han Jang Su on March 31, 2017, for acting for or on behalf of FTB, an entity designated pursuant to E.O.s 13382 and 13722.  On August 5, 2017, Han Jang Su was designated at the UN.  According to UNSC Resolution 2321 (2016), if a Member State determines that an individual is working on behalf of or at the direction of a DPRK bank or financial institution, Member States shall expel the individual from their territories.  Therefore, Han Jang Su and Ri Jong Won should be expelled from Russia.  Nevertheless, continuing into 2018, Russian bank Agrosoyuz continued to provide services to Han Jang Su, in violation of Russia’s UN obligations.  Agrosoyuzalso knowingly opened multiple bank accounts for at least three FTB front companies.  Ri Jong Won also held Russian bank accounts in his name at least as of late 2016. 

In addition to Agrosoyuz and Ri Jong Won, OFAC designated two associated FTB front companies — Dandong Zhongsheng Industry & Trade Co., Ltd. (Zhongsheng), pursuant to E.O. 13382, and Korea Ungum Corporation (Ungum), pursuant to E.O. 13722.

Agrosoyuz and North Korea have a long relationship:  from 2009 to 2013, Agrosoyuz processed millions of dollars in transactions through accounts owned by North Korean commercial banks.  In mid-2013, Agrosoyuz transferred more than $5.5 million on behalf of the now UN- and U.S.-designated Korea United Development Bank (KUDB).  In 2014, Agrosoyuz and other Russian banks arranged to move KUDB funds.  As of mid-2016, Agrosoyuz had opened new accounts for a North Korean front company, and it processed over $8 million and held the equivalent of over $3 million on behalf of KUDB.  In 2017, Han Jang Su opened bank accounts for Zhongsheng at Agrosoyuz.  In addition, as of early 2018, Agrosoyuz allowed a North Korean front company to invest almost $2.5 million in Russian rubles into an account with Agrosoyuz.

Today’s action, taken pursuant to Section 4 of E.O. 13810 of September 20, 2017, blocks all property and interests in property of Agrosoyuz that are in the United States, that hereafter come within the United States, or that are or hereafter come within the possession or control of any U.S. person, and provides that such property and interests in property may not be transferred, paid, exported, withdrawn, or otherwise dealt in.

Links:

OFAC Notice

Treasury Press Release

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