FATF Reiterates Concerns Over North Korea’s Inadequate Anti-Money Laundering Regime
Combating Financial Crimes and Preventing WMD Proliferation
The Financial Action Task Force (FATF) has reiterated its concerns over North Korea’s inadequate anti-money laundering (AML) and counter-terrorism financing (CFT) regime. This move aims to combat financial crimes and prevent the proliferation of weapons of mass destruction (WMDs).
A Significant Threat to the International Financial System
North Korea’s inability to address substantial weaknesses in its AML/CFT regime poses a significant threat to the integrity of the international financial system. The FATF has called on all jurisdictions to be vigilant when dealing with commercial contacts and transactions involving North Korean entities.
Effective Counter-Measures Needed
The organization has urged its members to implement effective counter-measures, including targeted financial sanctions, to prevent money laundering, terrorism financing, and WMD proliferation. These measures are necessary to address the country’s illegal activities, including currency counterfeiting, terrorist financing, drug trafficking, and money laundering.
North Korea Remains on the FATF Blacklist
Since 2011, North Korea has remained on the FATF blacklist due to its failure to address AML/CFT concerns. However, in February 2020, the organization temporarily halted the review process for both Iran and North Korea due to the COVID-19 pandemic.
DPRK Hackers Target Cryptocurrency Exchanges
In a recent report, independent sanctions monitors noted that DPRK hackers have persistently targeted cryptocurrency and other financial exchanges globally, generating an estimated $1.7 billion in revenue in 2022. These activities are allegedly used to fund North Korea’s nuclear and missile programs, although the country has denied any involvement.
International Sanctions Imposed
The international community has imposed severe sanctions on North Korea, including a ban on weapons exports and imports, as well as prohibitions on the supply of conventional weapons, sensitive commodities, and technology. The United States has implemented additional sanctions, including a ban on specific companies and individuals, and increased commercial penalties targeting North Korean corporate operations and overseas partners.
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