US indicts agents of sanctioned North Korean bank

The US Attorney's office for the District of Columbia unsealed indictments against 28 North Korean and five Chinese representatives of North Korea's Foreign Trade Bank (FTB) who are or were posted in China, Russia, Libya, Thailand, Kuwait, and Austria.

The Treasury Department's Office of Foreign Asset Control (OFAC) had designated the FTB for proliferation financing in 2013. The North Korea Sanctions Regulations later put additional restrictions on dealings with the North Korean financial industry.

The specific charges in the new indictments include:

- Conspiracy. When a defendant forms an agreement with another person to commit an offense and performs an overt act toward completion of the offense, he can be convicted of conspiracy even if the didn't complete the offense. In fact, one rarely sees an indictment without a conspiracy count.

The feds have charged the 33 defendants with conspiring to violate sanctions regulations, commit money laundering, and obtain financial services through the US financial system by evading Treasury and Federal Reserve regulations.

Violations of the North Korea sanctions regulations, violations of the weapons of mass destruction proliferation sanctions regulations. Any knowing transaction in FTB property or interests in property after March 11, 2013, violated the WMD sanctions regulations. And for those who fret about Pyongyang slipping free of the power of the dollar, starting on page 17 one sees numerous examples of wire transfers from a Point A in China to a Point B that's also in China, but which still had to clear a correspondent bank in the United States.

Bank fraud. Because North Korea is barred from the financial system under the Patriot Act, FTB representatives defrauded banks by cooking up lies to conceal their affiliations with the FTB to obtain financial services.

- International money laundering under 18 USC 1956(a)(2)(A), money laundering conspiracy under 18 USC 1956(h). The wire transfers came from places outside the United States through banks in the United States, and then to other places outside the US, including China, Russia, Libya, Kuwait, Thailand, and Austria.

Lying to bankers about due diligence queries and know-your-customer rules to sneak money through the US financial system is classic money laundering.

The New York Times adds up the laundered transactions and reaches a grand total of $2.5 billion.