Tags: Korean | Money | Scam | Was | Reaction | Sanctions

N. Korean Money Scam Was a Reaction to Sanctions

Friday, 15 June 2007 12:00 AM

NEW YORK -- It appears that the North Korean efforts at laundering their counterfeit U.S. currency is a result of U.S. moves sanctioning Banco Delta Asia in Macao.

In 2005, the U.S. Treasury banned Banco Delta Asia from interacting with the Federal Reserve System and threatened action against any bank that dealt with it.

A well-known local bank, Delta Asia had been accused of money laundering on behalf of North Korea.

At the time of the U.S. action, North Korea reacted strongly. and relations with the U.S. reached a low point. Many wondered why North Korea reacted as strongly it did, considering by Delta Asia's own records Pyongyang had just $25 million on deposit.

Now, it is believed that Delta Asia was a central conduit for circulating the so-called North Korean Super C Notes.

The "Super C's" were bogus U.S. $100 notes that the Treasury Department claims were of "exceptional" quality.

According to South Korean sources, the North Koreans had perfected a "washing" tecnnique to elude detection.

Simply put, Pyongyang would wash the ink from real U.S. $1 notes and reprint then in higher denominations.

It made detection of the counterfeiting very difficult, say the South Koreans.

While a firm figure on the amount of "funny" money passing through the Macao bank has not been offered, it is believed to be well in excess of the $25 million officially on deposit.

With the main conduit for circulating the counterfeit currency no longer available, Pyongyang searched for a new way to get its "cash" into circulation.

The answer: Leak the cash at home.

Leak it to foreigners who would be the least suspicious and the most vulnerable -- aid workers and diplomats.

In both cases, if anyone got caught, they likely would not be arrested nor any charges filed.

In the diplomats' case, not only would they enjoy diplomatic immunity, but the embarrassment of being scammed by the North Koreans would be such, that it likely would be kept out of the press, especially when it could involve the Chinese and Russians.

The Swiss have a long tradition of being "discreet" when it involves the issue of international banking.

All three countries' diplomats are believed to have been targeted by North Korea to unknowingly circulate the counterfeit currency.

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NEW YORK -- It appears that the North Korean efforts at laundering their counterfeit U.S. currency is a result of U.S. moves sanctioning Banco Delta Asia in Macao. In 2005, the U.S. Treasury banned Banco Delta Asia from interacting with the Federal Reserve System...
Korean,Money,Scam,Was,Reaction,Sanctions
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2007-00-15
Friday, 15 June 2007 12:00 AM
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