Washington: Today, the Department of the Treasury's Office of Foreign Assets Control (OFAC) sanctioned eight individuals and two entities for their role in laundering funds derived from various illicit schemes of the Democratic People's Republic of Korea (DPRK), including cybercrime and information technology (IT) worker fraud.
According to U.S. Department of the Treasury, North Korean state-sponsored hackers have been involved in stealing and laundering money to support the regime's nuclear weapons program. Under Secretary of the Treasury for Terrorism and Financial Intelligence John K. Hurley stated that these actors generate revenue for Pyongyang's weapons development, posing a direct threat to U.S. and global security. The Treasury remains committed to pursuing the facilitators and enablers behind these schemes to cut off the DPRK's illicit revenue streams.
A recent report by the Multilateral Sanctions Monitoring Team titled "The DPRK's Violation and Evasion of UN Sanctions Through Cyber and Information Technology Worker Activities" highlights the ongoing threats posed by these activities. The report links such operations to the funding of the DPRK's weapons of mass destruction (WMD) programs and the destruction of physical computer equipment.
Among those sanctioned are Jang Kuk Chol and Ho Jong Son, North Korean bankers who have managed funds, including $5.3 million in cryptocurrency, on behalf of the OFAC-designated First Credit Bank. A portion of these funds is connected to a DPRK ransomware actor previously targeting U.S. victims and handling revenue from DPRK IT workers.
OFAC has designated Jang and Ho Jong Son under various executive orders for providing support for cyber-enabled activities and commercial activities generating revenue for the Government of North Korea or the Workers' Party of Korea. Additionally, OFAC updated the SDN List entry for First Credit Bank to highlight its cryptocurrency addresses and activities.
Korea Mangyongdae Computer Technology Company (KMCTC), an IT company based in North Korea, has been implicated in operating IT worker delegations in China. KMCTC IT workers have used Chinese nationals as banking proxies to obscure the origin of funds generated through illicit activities. U Yong Su, the company's president, has also been designated under executive orders for his role.
The sanctions target a broader network supporting the DPRK's illicit financial activities. This includes Ryujong Credit Bank, which has been involved in sanctions avoidance activities between China and North Korea, and individuals such as Ho Yong Chol, Han Hong Gil, Jong Sung Hyok, Choe Chun Pom, and Ri Jin Hyok, who are based in China or Russia and have facilitated various financial transactions.
The U.S. government strongly condemns these activities, which support the DPRK's WMD and ballistic missile programs in violation of UN Security Council resolutions. The sanctions reaffirm the U.S. commitment to holding accountable those who target its citizens and benefit the DPRK's unlawful weapons programs.
As a result of the sanctions, all property and interests in property of the designated individuals and entities in the U.S. are blocked and must be reported to OFAC. Financial institutions and others engaging in certain transactions with these sanctioned parties risk exposure to sanctions or enforcement actions.
The ultimate goal of these sanctions is to induce positive behavioral change rather than punishment. OFAC provides avenues for seeking removal from sanctions lists, emphasizing the importance of compliance with international norms and regulations.