Civil Forfeiture complaint against companies laundering funds of sanctioned DPRK parties
United States Files Complaint to Forfeit More Than $2.37 Million From Companies Accused of Laundering Funds to Benefit Sanctioned North Korean Entities
WASHINGTON – The United States has filed a complaint to forfeit $2,372,793 associated with four companies, announced the Acting U.S. Attorney for the District of Columbia Michael R. Sherwin, Emmerson Buie, Jr., Special Agent in Charge of the FBI Chicago Field Office, and Steven Cagen, Special Agent in Charge of the HSI Denver Field Office.
The complaint alleges that the four companies laundered United States dollars on behalf of sanctioned North Korean banks. According to the complaint, the North Korean banks used these laundered funds as part of a scheme to procure goods for the North Korean regime, as well as to illegally access the U.S. financial market.
The four companies allegedly were part of a scheme to launder payments to subsequently sanctioned entities, to include: Velmur Management Pte. Ltd. (Velmur), which the Treasury Department sanctioned for procuring Russian petroleum products for North Korea; Dandong Zhicheng Metallic Material Co. (Dandong Zhicheng), which the Treasury Department sanctioned for purchasing coal from North Korea, and then in turn laundering the proceeds of those sale to purchase items for North Korea, including nuclear and missile components; and multiple cover branches of North Korea’s Foreign Trade bank, which the Treasury Department sanctioned for facilitating transactions on behalf of actors linked to its North Korea’s proliferation network.
“The Department of Justice has repeatedly disrupted North Korea’s illicit attempts to access the U.S. financial system,” said Assistant Attorney General for National Security John C. Demers. “We will continue to do so as long as the North Korean government maintains its destabilizing, dangerous WMD activities.”
“This complaint illuminates how a global money laundering network coordinates with front companies to move North Korean money through the United States and violate the sanctions imposed by our government on North Korea,” said Acting U.S. Attorney Sherwin. “This case demonstrates that we will use all tools in our Threat Finance Unit’s portfolio to target companies that harm U.S. national security, regardless of where they are doing business.”
“The FBI, along with our domestic and international partners, will continue to prioritize and dedicate the necessary resources to investigate and combat those who are assisting North Korea in evading sanctions by providing illegal access to the U.S. financial system, contrary to our national security interests,” said Emmerson Buie, Jr., Special Agent in Charge of the FBI Chicago Field Office.
“The discovery of this transnational criminal organization is the result of international law enforcement agencies working together in the interest of national security,” said Eric Balliet Deputy Special Agent in Charge, HSI Denver. “HSI will continue to leverage our unique international authority to protect the U.S. from companies who do business with North Korea.”
The complaint was filed on July 23, 2020, in the U.S. District Court for the District of Columbia. According to the complaint, designated North Korean banks used the four companies to make and receive U.S. dollar payments to/from North Korean front companies.
The United Nations Panel of Experts reported that North Korean banks have been able to evade sanctions and continue to access the international banking system. Specifically, despite strengthened financial sanctions, North Korean networks adapt by using greater ingenuity in accessing formal banking channels. This includes maintaining correspondent bank accounts and representative offices abroad that are staffed by foreign nationals making use of front companies. These broad interwoven networks allow North Korean banks to conduct illicit procurement and banking activity. The complaint alleges activity by the four companies that tracks this paradigm.
The claims made in the complaint are only allegations and do not constitute a determination of liability.
The FBI’s Chicago Field Office and HSI’s Colorado Springs Office are investigating the case. Assistant U.S Attorneys Zia M. Faruqui and Brian P. Hudak, and National Security Division Trial Attorney David C. Recker are litigating the case, with assistance from Paralegal Specialist Brian Rickers, Legal Assistant Jessica McCormick.
DOJ Press Release
Categories: Anti-Money Laundering Civil Forfeiture Department of Justice (DOJ) Updates Enforcement Actions North Korea (DPRK) Sanctions