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KOR

Press Releases

MOFA Spokesperson’s Commentary on the US Designation of North Korea as a Jurisdiction of Primary Money Laundering Concern

Date
2016-06-02 17:00:00
hit
1432

1. The Government of the Republic of Korea welcomes the US’ first-ever designation of North Korea itself as a jurisdiction of “primary money laundering concern” on June 1 under its North Korea Sanctions and Policy Enhancement Act of 2016, as well as announcement of its plan to take such follow-up measures as prohibiting opening or maintaining payable-through or correspondent accounts with North Korean financial institutions, and prohibiting the use of U.S. correspondent accounts to process transactions for North Korean financial institutions, the strongest-ever measures under the Section 311 of the USA PATRIOT Act.

2. The Government of the Republic of Korea notes with appreciation that the aforementioned measures reflect the firm commitment of the US to thoroughly implement UN Security Council Resolution 2270 and to continue enforcing strong, unilateral sanctions on North Korea with the aim to achieve the denuclearization of North Korea and induce the country to make substantive changes.

- In addition, the ROK government takes note of the fact that the US government has made the announcement far ahead of the deadline of the review stipulated in the North Korea Sanctions and Policy Enhancement Act.

3. In particular, the aforementioned follow-up measures, when in place, will have a direct effect of blocking North Korea's access to the U.S. financial system; and an indirect effect of restricting financial transactions between the US and foreign financial institutions, which hold payable-through or correspondent accounts with US counterparts, if they fail to halt transactions with North Korean financial institutions.

- In addition, the designation of North Korea itself as a jurisdiction of “primary money laundering concern” will have the effect of designating all the banks in North Korea as such. Therefore, the measures are expected to have broader effects than the “the Banco Delta Asia-type sanctions,” where only one bank was designated as such.

- In addition to Executive Order 13722, which was announced on March 16 and focuses on restricting the mobility of North Korea’s real assets, the designation of North Korea as a jurisdiction of “primary money laundering concern,” which focuses on restricting the mobility of fund, is expected to enhance the effectiveness of sanctions on North Korea.

4. The US announcement, which came after the EU’s announcement of comprehensive sanctions on North Korea on May 27 and the Ugandan government’s announcement on May 29 of its plan to stop cooperation with North Korea on security, military and police affairs, is another concrete action that reflects the firm resolve of the international community that it will not tolerate North Korean nuclear development.

5. The Government of the Republic of Korea, in close cooperation with the international community, including the US, will continue sanctioning and pressuring North Korea in order to make the country take the genuine path toward denuclearization.


* unofficial translation