Financial Crime World

FINTRAC Issues Warning on North Korean Financial Activity

Introduction

Ottawa, January 2019 - The Financial Transactions and Reports Analysis Centre of Canada (FINTRAC) has issued an operational alert to warn Canadian reporting entities about potential financial activity linked to North Korea.

Jurisdictions Associated with North Korean Use of the International Financial System

The alert highlights several jurisdictions that may be associated with North Korean use of the international financial system for money laundering and sanctions evasion. These include:

  • Liaoning Province, China, which shares a land border with North Korea
  • Jilin Province, China, where companies have been reported to employ North Korean guest workers
  • Hong Kong, a major centre of global finance

Transactions Warranting Additional Scrutiny

According to FINTRAC, transactions originating from or destined for these jurisdictions may warrant additional scrutiny, particularly if they display indicators of possible use of shell companies. While not specifically high-risk in and of themselves, such transactions should be considered at elevated risk when combined with other indicators.

North Korean Entities and Individuals

The alert also notes that North Korean entities and individuals have been observed using particular Canadian recipients, as well as engaging in financial activity through EFTs (electronic funds transfers).

Reporting Obligations

FINTRAC is reminding reporting entities subject to the Proceeds of Crime (Money Laundering) and Terrorist Financing Act (PCMLTFA) of their obligations to submit suspicious transaction reports or attempted suspicious transaction reports if they have reasonable grounds to suspect that a transaction or attempted transaction is related to terrorist activity financing or money laundering.

Contact Information

For more information, reporting entities can contact FINTRAC at:

Appendix I: Major Cities in Liaoning and Jilin Provinces, China

Liaoning Province:

  • Shenyang
  • Dalian
  • Anshan
  • Liaoyang
  • Fushun
  • Dandong
  • Jinzhou
  • Yingkou

Jilin Province:

  • Changchun
  • Jilin City
  • Siping
  • Liaoyuan
  • Tonghua
  • Songyuan
  • Baicheng
  • Yanbian