The U.S. Treasury Department’s Office of Foreign Assets Control (OFAC) is cracking down on North Korea’s digital asset money laundering network by targeting individuals and entities involved in the illicit operation. According to a recent statement released by the OFAC, Chinese nationals Lu Huaying and Zhang Jian have been sanctioned for their roles in the network, which utilized a front company in the United Arab Emirates (UAE) to launder illegal funds and convert cryptocurrencies for North Korea.
The OFAC has revealed that North Korea is employing agents and proxies to gain access to the international financial system and carry out nefarious revenue generation schemes, such as fraudulent IT projects and digital asset theft. These representatives are said to establish shell companies and manage bank accounts to move and disguise funds that will ultimately be used to finance North Korea’s prohibited weapons of mass destruction (WMD) and ballistic missile programs.
Acting Under Secretary of the Treasury for Terrorism and Financial Intelligence, Bradley T. Smith, emphasized the importance of disrupting the networks that facilitate the flow of funds to the North Korean regime, especially as they exploit digital assets to fund their illicit activities.
Lu Huaying was responsible for converting crypto funds from North Korea’s revenue-generating initiatives into fiat currency on behalf of Sim Hyon Sop, a key figure in the money laundering network who has also been sanctioned by the OFAC. Zhang Jian played a role in facilitating the exchange of fiat currency and acted as a courier for Sim.
In addition to targeting individuals, the OFAC has also sanctioned Green Alpine Trading, the UAE-based shell company that was utilized by the money laundering network to carry out their illicit activities.
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Image Source: Midjourney