On December 17, 2024, the U.S. Department of Treasury’s Office of Foreign Assets Control sanctioned two individuals – Lu Haying and Zhang Jian – based in United Arab Emirates (“UAE”) and a UAE-based front company that they allegedly used to launder millions of dollars in illegal funds for the Democratic People’s Republic of Korea (“DPRK”). The network allegedly laundered funds and provided cryptocurrency conversion services to ensure that illicit proceeds generated by DPRK information technology (IT) workers and cybercrime were transferred to Pyongyang. OFAC reported that the network has specifically benefitted Sim Hyon Sop, a PRC-based representative of DPRK’s Korea Kwangson Banking Corp (“KKBC”), who was designated by OFAC in 2023; the KKBC was designated by the United States in 2009. According to OFAC, the new designees helped Sim Hyon Sop by cashing out cryptocurrency, facilitating the exchange of fiat currency for Sim, and providing courier services for him.
These designations were imposed pursuant to Executive Order 13382, which targets those involved in the proliferation of weapons of mass destruction and their supporters. As a result of these designations, all property and interests in property of these designees within the United States or within the possession or control of a U.S. person are blocked, and U.S. persons are generally prohibited from engaging in transactions involving the designated persons. Entities owned 50 percent or more by one or more blocked persons are also blocked.
U.S. Department of Treasury Press Release | Global Narcotics Drug Flow Chart