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April 15, 2013

US Targeting Secret Funds of North Korea's Kim

by VOA News

A senior U.S. official says Washington is trying to block North Korean leader Kim Jong Un from accessing secret funds deposited in overseas bank accounts as it pressures him to stop developing nuclear weapons.

In an interview with VOA's Korean Service, the U.S. Treasury's undersecretary for terrorism and financial intelligence, David Cohen, said his department is looking for "very large amounts" of Kim's money.

"I can say that we are very actively looking for where that money may be.  If we identify where it is, we will do everything we can to deprive the Kim family's access to those funds," said Cohen.

After Kim's father and predecessor Kim Jong Il died in December 2011, some foreign media reports said the late Kim may have deposited at least $4 billion in European banks, including those of Switzerland.

Cohen said U.S. authorities are targeting the money as part of efforts to restrict North Korea's ability to finance its nuclear and ballistic missile programs, which world powers see as a threat to regional security.

The U.N. Security Council has imposed several rounds of sanctions on Pyongyang for carrying out nuclear and missile tests in recent months in violation of U.N. resolutions.

Washington also is trying to thwart a years-old North Korean program of counterfeiting US$100 dollar bills to fund those illicit activities, said Cohen.

"We believe North Korea is continuing to try to pass a supernote into the international financial system. It is less of an issue that it was a few years ago," he said. "It seems to have calmed down to some extent, but it is something that continues and it is something we are very focused on."

Cohen said the United States will introduce a new $100 bill with sophisticated security features later this year to make it harder for North Korea and others to counterfeit.

The Treasury official also expressed concern about another source of North Korea's foreign currency - an industrial zone that it jointly operates with South Korea on the northern side of the inter-Korean border.

"Precisely what North Koreans do with earnings from Kaesong, I think, is something that we are concerned about," said Cohen. "All of the hard currency earnings of North Korea are something I would say that we should be concerned about. There are a number of thousands of workers at Kaesong who get paid for their services, so I think it is a complicated situation."

Kaesong is a near-decade old industrial complex where South Korean manufacturers have hired cheap North Korean labor. Pyongyang withdrew its more than 50,000 workers from the industrial zone last week. forcing a rare shutdown in production at one of the only symbols of inter-Korean cooperation.

North Korea's move was in protest at joint U.S.-South Korean military exercises that it sees as a prelude to an invasion of the North. Washington and Seoul insist the drills are defensive. Pyongyang also has condemned the two allies for supporting the latest sanctions imposed on the North by the U.N. Security Council in March.