The United States has tightened its grip on North Korea’s shadow financial networks, imposing new sanctions on bankers and institutions accused of channeling cryptocurrency stolen in cyberattacks into Pyongyang’s weapons programs.
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Treasury Targets DPRK Crypto Network
The U.S. Treasury Department’s Office of Foreign Assets Control (OFAC) announced the designations on Tuesday, naming eight individuals and two entities involved in “laundering funds derived from cybercrime and IT worker fraud.”
Officials stated that the targeted network laundered proceeds from ransomware and cryptocurrency thefts to finance the regime’s military operations. Among those sanctioned were two bankers accused of managing at least $5.3 million in cryptocurrency through OFAC-designated First Credit Bank.
The funds were allegedly tied to a ransomware group that targeted U.S. victims and laundered earnings from North Korean IT workers operating abroad.
The sanctioned entities, including Ryujong Credit Bank and Korea Mangyongdae Computer Technology Company (KMCTC), allegedly utilized shell companies and third-country intermediaries to conceal cryptocurrency transactions. Treasury officials stated that the network utilized Chinese and Russian proxies to transfer funds undetected.
Alleged Nuclear Weapons Funding
“North Korean state-sponsored hackers steal and launder money to fund the regime’s nuclear weapons program,” commented Under Secretary of the Treasury for Terrorism and Financial Intelligence John K. Hurley.
“By generating revenue for Pyongyang’s weapons development, these actors directly threaten U.S. and global security,” he said. “Treasury will continue to pursue the facilitators and enablers behind these schemes to cut off the DPRK’s illicit revenue streams.”
KMCTC, based in Pyongyang, runs IT delegations in Shenyang and Dandong, China. According to the Treasury, its president and his team used Chinese nationals as banking proxies to disguise the origin of money earned by North Korean IT workers abroad.
The sanctions freeze any U.S.-linked assets held by the designated individuals and entities and prohibit American persons from conducting transactions with them.
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Earlier, the U.S. Department of Justice seized $7.7 million in cryptocurrency linked to North Korean IT workers accused of using stolen American identities to secure remote employment. According to the DOJ, the workers operated from countries including China, Russia, and Laos, concealing their true locations through VPNs and U.S.-based laptop farms.
The complaint alleged that the North Korean nationals posed as remote IT contractors for U.S. and international companies, generating millions of dollars in illicit earnings.
Additionally, the North Korean hackers have been accused of creating fake U.S.-registered companies to target crypto developers through fraudulent job offers, according to security firm Silent Push. Using LinkedIn-style profiles and fake interviews, the attackers tricked victims into downloading malware disguised as job-related files.
This article was written by Jared Kirui at www.financemagnates.com.
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