June 13, 2018

North Korea Must Come Clean About Its Dirty Money

By ​Neil Bhatiya and Elizabeth Rosenberg

With the June 12 summit between Donald Trump and Kim Jong Un having concluded with a joint statement establishing the mutual desire for the “denuclearization of the Korean peninsula,” attention now shifts to building the framework to make those words a reality. From the U.S. perspective, the statement contained few signposts for how North Korea would cease its weapons program. For any process to succeed, Kim must commit to coming clean about North Korea’s systemic and ongoing dirty money habits that have sustained its illicit nuclear program.  

For the U.S. administration’s goal of complete North Korean denuclearization to be successful, it must have a financial component. The destruction of test facilities, closure of reactors, and dismantling of missiles are critical stages of any disarmament agreement. Beyond these measures, any complete denuclearization process must include an additional step: Pyongyang must fully disclose the illicit financial networks it has used to raise money and procure materials for its weapons programs.

For decades, North Korea has operated sophisticated overseas networks of shell companies. It has scores of trusted agents to illegally finance and obtain the goods and technology through these fronts for its clandestine weapons of mass destruction program. Over many years Pyongyang has directed significant financial resources through the banking sectors of regional financial centers, like Hong Kong, Singapore, and Kuala Lumpur, as well as through Europe and the United States. It has disguised the acquisition of prohibited items by masking purchases as legitimate trade by the companies in its trusted network. United Nations Panel of Experts reports have repeatedly documented these proliferation finance practices, highlighting the dire implications for international peace and security.


Read the Full Article at The Diplomat

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