North Korea’s Illicit Funds Bolster Russia’s War in Ukraine, US Says

WASHINGTON DC – The United States on Thursday launched a broad, multi-agency initiative targeting North Korea’s illicit financial networks, which funnels money to Pyongyang’s prohibited weapons programs and increasingly, to Russia’s war in Ukraine.

The campaign includes rewards of up to $15 million for information leading to the capture and conviction of individuals involved in these schemes.

The coordinated actions by the US State, Justice, and Treasury Departments underscore Washington’s growing urgency to cut off revenue streams enabling Kim Jong Un’s regime to advance its nuclear and ballistic missile capabilities.

Officials revealed these funds are derived from diverse criminal activities, including sophisticated cryptocurrency theft, large-scale fraudulent IT worker operations, trafficking of counterfeit goods, and illicit oil smuggling.

“North Korea’s revenue generation schemes... often target US companies and US citizens to raise funds for North Korea’s dangerous and unlawful WMD (weapons of mass destruction) and ballistic missile programs,” the State Department said in a statement, drawing a direct link to the conflict in Europe.

“In many cases, these ballistic missiles have been unlawfully transferred to Russia, where they have been used to strike Ukrainian territory, including Kyiv,” reads the statement.

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Reward offers and targeted individuals

The State Department’s Transnational Organized Crime Rewards Program (TOCRP) has placed bounties on seven North Korean nationals.

The highest reward, up to $7 million, is offered for Sim Hyon-sop, a central figure in these illicit operations. His alleged co-conspirators, Myong Chol-Min and Kim Se-Un, each carry a reward of up to $3 million, while Kim Yong-Bok, Kim Chol-Min (known as “Jack”), Ri Tong-Min (known as “Elvis”), and Ri Won-Ho are targeted with rewards of up to $500,000 each.Sim Hyon-sop and others, including Kim Se-Un, are implicated in activities ranging from illicit tobacco trade to pervasive IT worker schemes.

Speaking to reporters Thursday afternoon, senior US officials detailed how North Korea dispatches thousands of highly skilled IT workers globally, often operating from Russia and China.

These operatives use fraudulent documents, stolen identities, and fabricated personas to secure high-paying remote jobs with unsuspecting companies, including those in the US.

A substantial portion of their earnings, estimated at hundreds of millions of dollars, is systematically diverted back to the North Korean government to fund its WMD development. Some of these IT workers have also reportedly injected malware into corporate networks.

Sanctions and indictments

In a targeted move, the US Treasury Department sanctioned Korea Sobaeksu Trading Company (also known as Sobaeksu United Corporation), identifying it as a front for the US-designated Munitions Industry Department, which is directly responsible for Pyongyang’s nuclear program.

Sobaeksu has been instrumental in nuclear procurement and deploying IT worker teams abroad, including to Vietnam, to generate crucial illicit income.

Three additional North Korean individuals were designated by the Treasury Department, facing immediate blocking of their assets under US jurisdiction.The Justice Department also unsealed indictments against seven North Korean nationals for sanctions evasion related to the illicit trafficking of counterfeit cigarettes.

Additionally, the US highlighted the case of Christina Marie Chapman, an American citizen scheduled for sentencing Thursday in DC for her role in a North Korean IT worker scheme that defrauded over 300 US companies.

The State Department’s Rewards for Justice program maintains a standing reward offer of up to $5 million for intelligence that leads to the disruption of financial mechanisms and sanctions evasion schemes that support the North Korean government.