Pyongyang Papers has continued its recent investigations into the illicit money-making schemes of North Korean individual Nam Un Gyong and her daughter, Ri Son Chong. As previously reported, Nam owned and ran a restaurant called the Blue Flower in Cambodia, this is a blatant violation of UN sanctions which prohibits DPRK individuals working abroad. The money earned from DPRK nationals abroad such as Nam and her daughter, is sent back to the DPRK regime and continues to fund its nuclear weapons program.

The Cambodian government ordered the Blue Flower to close and so we have been keen to see what Nam and Ri have been doing since the closure of the restaurant.

Ri Son Chong was studied business administration at a University in Cambodia, but we know she is also involved in the illicit endeavors of her mother and some of her own. Ri Son Chong helped both in the kitchen and on the cashier desk at the Blue Flower until its closure, whilst also facilitating the production and sale of kimchi to restaurants in the local area of Phnom Penh. We contacted the Blue Flower Facebook page after releasing the last article for comment and the page name and display photo was swiftly changed…

Nam & Ri movements

Pyongyang Papers believes that Nam, and her daughter Ri Son Chong traveled from Phnom Penh to Beijing in the middle of January and Nam’s plan is to head to Shenyang, then Dandong and then back to Beijing before finally traveling back to the DPRK! In our last investigation we noted how Nam had parted ways with her former business partner and was looking for a new partner to open a joint venture restaurant in China. With Nam planning to head back to the DPRK we are unsure where this leaves the plan for the joint venture restaurant in China. Maybe Nam has passed the plan onto another DPRK national in China. If you have any information on the status on the joint venture please get in touch via the ‘Contact Us’ page.

During our investigations, we have also uncovered that Nam Un Gyong also has another daughter – Ri Son Hwa. Ri Son Hwa attended a foreign university and currently works as a trading employee at the Rakwon Guidance Bureau. The Rakwon Guidance Bureau is believed to sit under ‘Room 39’, a secretive party organization which seeks to maintain foreign currency for the North Korean leaders.

It is well documented that ‘Room/Bureau 39’ is a secretive North Korean party organization that seeks ways to maintain the foreign currency slush fund for the country’s leaders

Luxury Goods

Investigations by Pyongyang Papers have also uncovered additional details about Nam Un Gyong and Ri Son Chong activities. It appears the duo were also involved in the luxury goods trade. We are aware of a deal involving both Ri Son Chong and Nam with a Thailand-based DPRK Korea Chilsongmun Trading Corporation (CTC) employee. Ri Son Chong and Nam have spent hundreds of thousands of $’s on alcohol, buying and exporting it from Cambodia to DPRK. Importing and exporting luxury goods to and from North Korea also contravenes UN sanctions, however it is widely known that Kim Jong Un is partial to unhealthy habits such as drinking and smoking. We wonder whether Ri Son Chong and Nam’s shipment is headed straight for their leader? Nam and Ri Son Chong also worked with individuals Heng Sovannary and Srey Pov, based in Cambodia, to export more alcohol to DPRK.

The purchasing of luxury goods isn’t limited to just alcohol as we believe that Ri Son Chong has been buying Tommy Hilfiger purses as gifts for friends on her return to the DPRK. We also know Ri Son Chong was looking into other high-end brands such as Bottega Veneta.

Moving Money

It is clear that both Nam and her daughters have the connections and know how to set up these trade deals but we have been questioning how Nam has managed to earn currency overseas as a North Korean citizen without raising suspicion from the banking authorities. Our investigations have uncovered that a Cambodian individual that worked for Nam at her restaurant allowed her to use their bank account to receive large amounts of money. This is a tried and tested method for North Koreans who are earning illicitly abroad.

We are glad to hear that the Cambodian authorities are enforcing sanctions, we hope that China will follow suit and end Nam and her daughters sanction evasion activity. However, based on some of our previous investigations- we aren’t that confident!

Pyongyang Papers will continue to investigate Nam’s sanction breaking activity- if you are aware of any information then please contact us.

Pyongyang Papers recently reported on a restaurant called the Blue Flower located in Phnom Penh, Cambodia and is run by two North Koreans: Nam Un Gyong and her daughter Ri Son Chong. By running the restaurant Nam and Ri are violating UN Security Council resolution 2397, which prohibits North Korean citizens from working abroad. It is also widely known that the money made by North Korean’s abroad makes its way back to the Kim Jong Un regime and funds North Korea’s nuclear and ballistic missile program, one of many sources of contention between the rest of the world and North Korea.

Blue Flower restaurant employees escape police

In our last article we reported how Cambodian authorities had given orders for The Blue Flower restaurant to be closed down. It appears Nam did not listen to the warning, as in a dramatic turn of events, we have been informed that she had to secretly escape from the Blue Flower and that the DPRK staff narrowly avoided capture by the Cambodian authorities due to the constant police presence at the restaurant. Our sources tell us these North Korean employees have now left Cambodia.

Investigations have confirmed that the Blue Flower restaurant is now officially closed and the premises where the restaurant was located apparently trashed. As mentioned previously, the restaurant employed Cambodian nationals due to DPRK border closure. We understand that the Cambodian nationals have all been fired and reportedly left the area. The restaurant may have closed but this does not mean the money-making activities by Nam & Ri have stopped!

North Korean Restaurants in China

With the closure of the Blue Flower. Nam has parted ways with her former business partner, an individual named Pan Yong and is already looking for a new business partner to help her open a joint venture restaurant in China! Since the beginning of this year, despite sanctions being in place, it is reported that at least 10 restaurants and hotels staffed by Koreans have popped up in three Chinese cities. Now that the DPRK borders are slowly re-opening, we believe that many thousands of North Korean workers are returning home from China under a week-long quarantine after arriving in a number of locations, including Rason, Sinuiju and Sunan. The re-opening of the border has also included freight trains making the journey between the two countries again, with one specifically arriving in Sinuiju and returning back to Dandong 45 minutes later.

A view of the sino-Korean friendship bridge

Could this mean more DPRK workers are preparing to move to China to replace the returning workers? or is China finally observing UN Sanctions? Only time will tell but Pyongyang Papers has suspicion it won’t be China observing UN sanctions! Historically, the two sides of the border have agreed to work together to prevent illegal crossings between the Yalu River and Tumen River, with both countries providing their own guards and agreements around times people were able to make the crossing. China also forcibly returned over 500 North Koreans who had escaped to China back over the border.

Illegal workers bringing home souvenirs

It is also likely that the returning DPRK workers, who were sent abroad to work and earn for the regime, will bring a number of sanctioned items home with them, such as money and luxury goods. It appears the Blue Flower had a number of elaborate, expensive looking paintings throughout the restaurant and stocked a large amount of high-end alcohol. Pyongyang Papers wonders if the returning workers and return of freight movement will see an influx of other sanctioned items into North Korea.

One of the paintings from the Blue Flower restaurant

Pyongyang Papers will continue to investigate Nam & Ri as they look to continue their efforts in China to earn sanctioned revenue for the North Korean regime but it is clear that China has a major role to play in enforcing UN sanctions aimed at stopping funds reaching the DPRK and being used to advance its nuclear and ballistic missile program. This is especially relevant given the recent launch of North Korea’s first ‘spy’ satellite using ballistic missile technology.

If you have any further information on Nam Un Gyong, her daughter Ri Son Chong or any other North Korean sanctions evasion, please get in touch through the ‘Contact us’ page.

North Korean officials based overseas continue to break UN sanctions by brokering and facilitating deals, earning commision, so they can funnel money back to the regime and fund its nuclear weapons programme. UN Resolution 2270 states that all memeber states are to prohibit DPRK diplomats, government representatives (or DPRK nationals working in that capacity) from participating in joint ventures and any other business arrangements.

However, brokering deals is not a new money making scheme for the North Koreans- Pyongyang Papers have previously reported on illict deals facilitated by North Korean officials which you can read here. This time we are investigating a deal involving the brokering of oil between Russia and China.


DPRK acting as the middleman between two countries

Our sources have informed us that DPRK representatives based in Russia, are acting as middlemen to broker a deal for PRC-based company Yao He San Cai Petrifaction Limited for the purchase of Russian diesel fuel from Russian-based LLC RN-Komsomolsky Oil Refinery (RN-KNPZ). The deal is agreed for an initial time of 12 months with extensions. RN-KNPZ is located in Komsomolsk-On-Amur, Khabarovsk territory, which is near to the China-Russia border. Specializing in motor fuel and aviation kerosene, the plant was put into operation in 1942 under the integrated structure of Rosneft Oil Company and its crude distillation refinery capacity equals 46.9 million barrels per year.

LLC RN-Komsomolsk Refinery is the largest producer of oil and gas in the Samara region of Russia and the second largest Rosneft production unit after Yuganskneftegaz.


The North Koreans aren’t the only ones suffering the consequences of sanctions, LLC RN-Komsomolsky Oil Refinery has also been sanctioned by the Office of Foreign Assets Control amidst the Russian invasion on Ukraine.

Oil Imports


Chinese imports of Russian oil hit their highest level in May since the Ukraine invasion started in 2022. This could be down to the sanctions put on Russia and their import of oil is forcing them to sell for cheaper, or the fact that Xi Jinping and Vladimir Putin pledged to boost trade to $200 billion in 2023 when they hailed their no limits partnership. As previously reported by Pyongyang Papers, we all know that China doesn’t shy away from sanction breaking activities. The PRC based company, also known as Yaohe Sancai Petrochemical (Shandong) Co. Ltd, has the address of Room 202, office building No. 819, Tuanjie Road, Qingdao area, China (Shandong) and appears to own a gas station on Yucai Road, Linyi City. With no obvious presence online, this company has a capital of $586 million and its president, Chen Dan, is linked to 7 other companies! We wonder if any of these other companies are breaking sanctions too?


Why use these middle men?

North Korean intermediaries, or middle men, have played a key role in the facilitation of oil deals between Russia and China to provide a bridge between the finances. DPRK representatives are busier than ever and with Russian oil being cheaper, it helps to compensate using them – so a win for all of those involved. Although the North Korean intermediaries would probably be losing all their income to the Regime back in their homeland funding the WMD programme! Using these middle men also means that these deals can go under the radar as there wouldn’t be any direct communication between them. Making it easier to get away with!
If you know any more about this deal or the companies involved, please do get in contact with Pyongyang Papers. We are always very appreciative of any information our followers can provide us.

As Pyongyang Papers have previously reported, North Korea exporting coal new. As UN Security Council Resolution 2371 states: “The DPRK is prohibited from supplying, selling, transferring .. coal” and “All Member States are prohibited from procuring such material from the DPRK. by their nationals, or by using their flag vessels or aircraft, whether or not originating in the territory of the DPRK.” Of course, this hasn’t stopped China!

Is coal the ultimate export for North Korea

Our sources have told us that Chinese company called Smart Legend Management Limited (駿成管理有限公司), which may also be known as General Success management Limted has agreed nearly $7 Million to buy 100,000 tons of anthracite coal from Korea O-IL Trading Corporation, formally known as Korea 51 Trading Corporation. This isn’t the first time the company has been involved in sanction breaking activity as Korea 51 Trading Corporation was also mentioned in the August 2020 UN Panel of Experts report as they were involved in employment of 292 DPRK workers abroad.

In 2022, the DPRK smuggled in excess of 525,000 tons of coal to China confirming China’s disregard for the UN by repeatedly purchasing sanctioned goods and services from North Korea. China’s willingness to deal with the North Korean regime has not gone unoticed. Recently, the G7 countries plus three other countries collectively asked China to stop allowing North Korean sanctions evasion in its waters!

North Korea continue to export coal to their allies despite shortages of coal at home, causing hardship for their own population. Kim Jong Un even instructed in his 2019 New Year’s address that coal exports would be redirected for domestic use for North Korea to become self-sufficient. The income from their 5 billion tons of anthracite reserves must be worth much more to the regime via sanctioned exports than their own citizens energy supply. Pyongyang Papers believes the regime would rather earn money for its nuclear and ballistic missle program than help its own citizens!

So how do you deliver 100,000 tons of anthracite coal?

North Korea use multiple ship-to-ship transfers via the yellow sea from Nampo Port. The ship-to-ship transfers are an effort to avoid detection although it has been widely that sales have continued since the sanctions were imposed. It is also believed that they are getting braver with their exports and avoiding ship-to-ship transfers, with Chinese ships collecting the coal from Nampo port direct!

In 2021 Coal exports from North Korea to China rose due to severe shortages causing rolling blackouts in many parts of China. Sadly, for the two countries the 2022 total is down mainly due to the COVID pandemic positive cases within China throughout the year.

Going back even further, 38 North conducted analysis looking at satellite imagery of the coal mines in North Korea between 2015-2019. They found a considerable increase in activity with noticeable growth of spoil piles around the mines and improvements to transport system to get coal to ports like Nampo. These images show that the sanctions have not affected North Korea’s coal export industry and none of its infrastructure has collapsed. In January 2023 Korean Central News Agency announced that DPRK coal production had increased “by intensifying the ideological work to arouse the masses”!

Nampo-Tae-Phyong-2
Tae Phyong 2 docks at the North Korean port of Nampo – August 2021

Why China?

North Korea and China have a difficult relationship. Although they are allies their relationship has deteriorated with Kim Jung Un’s missile testing and deliberate timing close to big Chinese events. It is questionable why Kim Jong Un would decide to do this as China has a hand on North Korea’s economic power and stopping trade with them would be extremely disruptive. China could easily import their coal from other countries but due to political intentions and economic benefits for China, the risk of being caught sanction breaking is outweighed by the advantages. A North Korean defector told one news outlet that North Korea would only last a month without its trade deals with China! So, no wonder why the two countries are so keen to continue supporting each other.

If you know any more information about these coal deals and the companies involved in them, please get in contact with Pyongyang Papers through the ‘Contact Us’ page!

North Korea is one of the only few countries worldwide that is still not a member of the International Labor Organization (ILO), choosing instead to continue exploiting its citizens and using forced unpaid labor to fuel its economy.

High number of DPRK laborers in China are only increasing

Since Kim Jong Un became leader of the DPRK in 2011, the number of workers sent abroad has increased to earn foreign currency for the regime. DPRK contracts with foreign governments including: Russia; parts of Africa; East and South East Asia; Middle East and Eastern Europe are all receiving forced labor with their movements and communications under constant scrutiny by DPRK government ‘minders’. Any complaints by the workers, or those who flee, will have consequences and will result in action being taken against their relatives back in the homeland.

We all know the Human Rights are an issue when related to the DPRK, well, Pyongyang Papers have been tipped off about incidents of assault amongst North Korean Laborers by their unit managers within their neighbors and close ally, China. Is China also turning a blind eye to this behavior? The People’s Republic of China (PRC) has a long record of circumventing sanctions in order to trade with the DPRK. According to the U.S. State Department’s 2021 Trafficking in Person’s report, there are between 20,000 to 80,000 DPRK workers in China. With reports suggesting that the Chinese Labor market is worsening (worse than the official monthly figures) with less jobs available nationwide and Chinese youth jobless rates hitting record high of 20% in July, we are not sure how much work there actually is for these thousands of North Korean workers when they get to China. With money still being sent home to the Regime, China is paying the price for this partnership.

Forced to work in poor conditions

Those that do have work are subject to back-breaking labor for 12 hours a day and are even banned from leaving their accommodation or work places since the Covid pandemic – even before that, they were only allowed to leave for their local markets in small groups. Add these poor conditions to the reports of assaults, the DPRK workers are more like slaves! North Korean authorities have also sent orders to the North Korean consulate, underscoring that officials should keep a closer eye on the workers to prevent them form fleeing and to work harder. These orders have obviously trickled down to the managers and put pressure on them to deliver! Pyongyang Papers would like to think this is isolated, but fears the worst, as we understand several China-based DPRK labor cooperation managers had verbally abused, along with physically attacking their fellow countrymen.

North Korean workers and imports continue to cross border into China despite UN sanctions | South China Morning Post
DPRK laborers allowed to leave their dorms

As well as failing to send the DPRK workers home before December 2019 deadline (as ordered by UN sanctions), it looks like the Chinese companies that employ these illegal workers also have no regard for their safety and well being. There is no excuse for this behavior and in a civilized society this conduct would not be tolerated. Perhaps the managers are more concrrned by meeting targets than the welfare of their underlings.

There are so many wrong doings on DPRK workers in China but as usual, money comes before basic human rights. Will the international community stand by the people of North Korea by putting further pressure on Pyongyang? If you have any information about DPRK workers in China, please reach out to us.

Pyongyang Papers has recently reported on DPRK illicit sanction breaking activity which involves North Korean officials brokering deals and netting $millions in commission, which is funneled back to the regime’s ballistic weapons money pot. Since our last article, we have been busy investigating more million $ commission-based dealings with Chong Sang-Hun and Chong Hyok.

China’s Port of Ningbo-Zhoushan

The latest deal we have been investigating involves thousands of tonnes of copper cathodes being delivered to China’s port in Ningbo, over a 12-month period. The port is located in Ningo and Zhoushan, on the coast of the East China sea and is the busiest port on the world in terms of cargo tonnage, however it has faced much disruption since the COVID-19 pandemic began.

Ningbo-Zhoushan port
The port of Nigbo-Zhoushan

The copper cathodes deal is between a Indonesia-based trading company International Investment Trading (IIT) and China-based Liaoning Zhongwo Petrochemical Co., Ltd. (LZPC.) IIT have been commodity re-traders since 2019, specializing in the gold, copper, steel and oil products. Chief Exec Mr Micheal E Jones claims to ‘believe in transparency’, ‘are hungry to grow’ and are ‘proud to offer their clients and suppliers a fair deal at a reasonable price’. LZPC have been operating since 2021. Here at Pyongyang Papers we wonder if IIT’s clients are aware of their illicit involvement which in turn supports the DPRK’s nuclear program?

Coking Coal from Russia to China

Sang-Hun and Hyok have also facilitated another deal on behalf of China involving hundreds of thousands of tonnes of coke, originating from Russia. China, the world’ biggest coal consumer, is drastically increasing it’s domestic coal output. However, the quality o the fuel produced from its own mines is low and unsuitable. Metallurgical coal is key feed stock for steel making, meaning Chinese steel-makers are still dependent on overseas suppliers for coking coal.

After the US, Russia is the second in line with the World’s largest coal reserves. However, following the Russian invasion of Ukraine, many buyers in Europe along with Japan had already significantly reduced their dealings with Russia. Coupled with this, since August Russian coal imports have been subject to a ban in the European Union.

This has resulted in Russia significantly discounting their cargo – well below rates from other suppliers, like Indonesia and Mongolia.

Not to miss out on an offer, China have seized their opportunity. Reuters reported in May on record surges of coking coal imports from Russia to China, with a Beijing-based coal trader stating ‘Chinese and Indian traders are snapping up Russian cargoes as Western companies scale back, even though the embargo has not officially taken affect yet’.

According to Chinese customs data, Coking coal imports from Russia to China jumped to 2.5 million tonnes in September, from about 900,000 tonnes in the same month last year and 1.9 million tonnes in August.

DPRK earn Commission on China Cole Deal

The coke deal brokered by the North Korean officials is being delivered to China’s port in Longkou, with China Rozhao Le Song Trading Co., Ltd being the recipient. Longkou port is a artificial deep-water international seaport located in the province of Shandong, which imports and exports mainly consist of cargoes from the petrochemical industry.

Pyongyang Papers wonders whether the embargo will have any effect on Russia. Especially as China are more than happy to increase trading. Even if they are not involved in the deals directly, the DPRK will find any way possible to earn some quick money and break sanctions. If you are aware of any deals involving the DPRK, please get in touch with us through our ‘Contact Us’ page.

It seems the DPRK have zero boundaries when it comes to the illicit sanction breaking activity they are involved in the fund their nuclear weapons program. Pyongyang Papers has recently reported on the DPRK’s ventures in cyber-crime, adding to it’s tried and tested methods of generating funds such as ship to ship transfers, overseas workers and importing luxury goods.

Pyongyang Papers has been informed of a deal involving DPRK officials in Southeast Asia. Chong Sang-hun, based in Thailand, and Chong Hyuk, based n China, are acting as middlemen in brokering deals that netted $millions in commission. We have noticed that when the DPRK have no illegal services or goods to offer themselves, instead they use their nationals, often those acting in official roles such as Sang-hun and Hyo’k, broker these deals for other countries and as a result earn a commission fee to send back to the regime.

The deals for the purchase of tonnes of gold over a 12 month period were on behalf of the Chinese company Hainan Huaxian trading Company Ltd. (HHTC) as the buyer and Golden Lion Precious Resources Pte Ltd as the seller.

Golden Lion Precious Resources are an exempt private company with a registered address at 7, Temasek Boulevard, #12-07, Suntec Twoer One, Singapore 038987. the company’s activity is gold bullion brokers.

Our investigation into HHTC and their involvement in illicit North Korean activity is still underway, but we have been made aware they were also in the market to purchase multiple hundreds of thousands of tonnes of aluminum ingots over a two-year period. We wonder if San-hun and Hyok will jump at the chance to make some quick money off the back of this deal too.

Nuke testing

Kin Jong Un’s persistent refusal to stop north Korea’s nuclear testing program resulted in enforced UN international sanctions in September 2017. Resolution 2270 states that all member states are to prohibit DPRK diplomats, government representatives (or DPRK nationals working in that capacity) from participating in joint ventures and any other business arrangements.

However, it seems the constant tightening of UN sanctions, crippling the North Korean economy, have still not deterred Kim Jong Un from testing Nukes. In fact, since the sanctions were introduced the missile tests have increased at an alarming rate.

In 2020, North Korea conducted four missile tests. This doubled in 2021 to eight tests. In 2022, Kim Jong Un has so far conducted 16 tests, and judging from recent speech he made at a military parade, Kim Jong Un appears defiant in increasing the country’s nuclear capabilities:

“We will continue to take steps to strengthen and develop out nation’s nuclear capabilities at the fastest pace,” he said, adding that their nuclear forces ‘must be ready’ to be exercised at any time, according to a report by the Official Korean Central News Agency (KCNA). Despite in the past proclaiming that the nuclear weapons would only ever be used in acts of self-defense, his speech indicated that this may not be the case. “The fundamental mission of our nuclear forces is to deter a war, but our nukes can never be confined to the single mission of war deterrent even at a time when a situation we are not desirous of at all is created on this land. If any forces try to violate the fundamental interests of our state, our nuclear forces will have to decisively accomplish its unexpected second mission. The nuclear forces of our Republic should be fully prepared to fulfill their responsible mission and put their unique deterrent in motion at any time”.

Adversaries & Allies

The increase in nuclear weapons could be a direct response to increasing tensions with North Korea’s long-term adversaries – the united States and the republic of Korea.

The recent election of South Korea’s new president Yook Suk-yeol, who has voiced a harsher line on North Korea’s actions, has frayed relations between the countries who already have problematic history. In 2018, Kim Jong Un agreed a suspension on long-range ballistic missile tests and nuclear tests following talks with the then US president Donald Trump. Kim Jong Un announced he was no longer bound by his promise in 2020 when relations between the two countries seem to have become increasingly fraught since.

Coupled with this, Kim Jong Un has been displaying public support for Vladimir Putin’s decision to invade Ukraine, despite strong condemnation by the US ad its allies. North Korean state media published a recent letter sent from Kim Jong Un to Vladimir Putin, congratulating Russia on the occasion of its Victory day holiday. Within the letter Kim also send ‘solidarity to Russia’s peoples achievements’ that fundamentally aim to ‘eliminate’ political and military threats posed by ‘hostile forces’ and ‘protect the dignity, peace and security of the country’ adding that ‘friendly relations that’s strategic and tradition’ between North Korea and Russia will ‘strengthen and develop . . . with the demands of the times’.

It remains to be seen what Kim Jong Un’s next move will be. But judging from his recent activities, we can be certain it will be provocative and of a hostile nature. Until North Korea agree to cease it’s nuclear weapons program, the security of it’s neighboring countries and adversaries are at great risk. the world must unite and put a stop to the countries and organizations that continue to help the reckless and unruly regime fund it’s weapons program that threatens us all.

If you have any further information on organizations involved in sanction breaking activity, please get in touch with us at Pyongyang Papers.

Pyongyang Papers has extensively reported on the topic of sanctioned DPRK citizens abroad, but it doesn’t seem to be improving as far as we can see.

Why are North Korean workers abroad a problem?

It not uncommon for people of all nationalities around the world to move and seek employment abroad for a range of different reasons including experiencing different cultures, a better quality of life and for financial gain. Unfortunately for North Korean citizens the situation is very different. Citizens of the DPRK are not afforded the luxury of the freedom to travel abroad unless the regime requires them to do so and that requirement is usually to make money for the regime!

Since 2017, all UN member states have been prohibited from providing work authorizations for DPRK nationals in their countries as well as ensuring that any present North Korean workers were repatriated by the end of 2019. The resolution was introduced to try and stem the flow of foreign currency heading back to the regime in support of its nuclear and ballistic weapons program and to stop the exploitation of North Korean citizens who are not protected by labor laws and often have their human rights easily violated.

An ongoing issue

There continues to be regular reports of North Korean workers being sent abroad with the ongoing pandemic around the world being used as a reason for not being able to repatriate those already abroad. The latest UN Panel of Experts report documents several instances of overseas workers still earning currency in China, Equatorial Guinea, Lao, Russia and Vietnam across a variety of different industries including construction, clothing, IT and the restaurant trade.

The majority of overseas workers are believed to be in China and Russia. Given the historical ties between the 3 countries, the shared border offering easy transit during non-pandemic times and North Korea labor costing half as much as native labor this may not be a huge surprise. Worryingly the attitude of China and Russia, who both claim to faithfully implement the UN sanctions, can be easily determined from their replies to the UN Panel’s requests.

For example, when questioned about entities using DPRK labor, China responded “The companies mentioned in the Panels letter only have the English and Korean names. Since China’s business registration system uses only Chinese language, we cannot conduct comparison and verification, and if the Panel requires China to verify every time it gets some new information, it will be a huge burden of work. It is also by no means the obligation of the Chinese government”.

China’s response to using DPRK labor, UN PoE report S/2022/132

Korea 51 Trading Corporation

China may not care, but Pyongyang Papers does! We have been informed that the DPRK company, Korea 51 Trading Corporation are looking to renew labor contracts for the next 10-years. Korea 51 Trading Corporation appeared in the August 2020 Panel of Experts report for sending 292 DPRK nationals in January 2020 and 190 in August 2019 to work for a clothing comoany called Dandong Manch’o’p Clothing Cooperative Ltd. The panel noted that Korea 51 may be using a different name. As part of the contract we have been made aware of, 900 North Korean laborers will be sent to two Chinese corporations– we have been informed that one of the corporations to receive the laborers are China Yanbian Jinyang Industry Co., Ltd (延边金洋实业有限公司).

Yanbian Jinyang Industry Co., Ltd are a company located in Kaishantun Town, Longjing City, Yanbian Prefecture, directly next to the DPRK border. The company is involved in many different businesses according to listings online including contracting, construction, mechanical processing, chemicals, metals, glass and processing and sales of clothing. The executive director listed as Li Yang (李洋). In addition to the 900 North Korean laborers, another 1,000 workers already in the area of Longjing would be transferred to work for the Chinese corporation.

The labor market

Recent reports suggest that the labor market has tightened recently due to the ongoing effects of the COVID-19 pandemic as demand for workers increases. A recent radio free Asia article reports on North Korean placement officials demanding more money and incentives which in turn leads to potentially even more money for the regime.

China are not the only country that is still breaking UN sanctions. During our investigation we have come across more information about a contract whereby UN sanctioned DPRK laborers would be working in the clothing industry in Nigeria. It appaers that The DPRK Nigerian Representative Office of an entity named Chinson General Co., Ltd and a Nigerian clothing manufacturing company called Purple Firm located in Lagos, are working on a 3-year labor contract. Details are very limited but Pyongyang Papers will continue to explore and expose any additional details we uncover.

Stopping the problem

Instances of North Koreans working abroad to fund the regime are easy to find and our investigation proves that the problem isn’t going to be resolved anytime soon. Countries like China use poor excuses to avoid thoroughly investigating evidence that suggests sanctions breaking activity is happening within their borders. Until all members of the UN unite and enforce the resolutions they have agreed to then the DPRK regime will continue to make large sums of money by exploiting its own citizens.

As always, if you have any information on sanctioned North Korean activity please get in touch with Pyongyang Papers.

Since 2017, The United Nations has listed coal amongst the goods and services sanctioned against the DPRK. The Security Council decided the “DPRK shall not supply, sell or transfer, directly or indirectly from its territory any coal“. The resolutions also state “All states shall prohibit the procurement of such material from the DPRK”.

Despite sanctions the DPRK have continued to trade coal illicitly. This has been done through a network of illegal overseas business transactions and deceptive maritime ship-to-ship transfers with states who are willing to assist in sanction breaking activity.

Foreign currency

As reported previously, coal is North Korea’s major export and foreign currency earner. Most of North Korea’s coal is exported through China in a clear breach of UN sanctions. Estimates for DPRK coal reserves at around 4.5 billion tonnes worth in the region of $600 billion.

According to UN report in 2020, North Korea exported 3.7 million metric tons of coal between January & August 2019 despite sanctions, with estimated earnings of $370 million through these exports. However, exports did drop during the COVID-19 pandemic as North Korea closed its borders to slow the spread of the virus, having resumed again since. It has been reported that the DPRK exported several dozen shipments of illegal coal to Chinese waters and ports between September 2020 and October 2021, data and satellite imagery sourced to an unspecified UN member state indicated in the report.

According to a DailyNK report, coal mines in DPRK were ordered to engage in a week long campaign in February to generate foreign currency, scrambling coal to the port of Nampo for export. Although DPRK has an abundance of coal for burning, it is known that DPRK does not have any reserves of coking coal which is used mainly in iron ore smelting for making steel, the hermit state has a long history of importing this commodity. For a long time the DPRK has been trying to develop its own technology to produce coking coal from its own anthracite. if only it was that easy!

Coking Coal?

Although the DPRK has no coking coal, it does have substantial reserves of anthracite in the city of Anju and other areas of production. So where and how do the DPRK regime get their coking coal if they don’t have any? Pyongyang Papers has been investigating a Mongolian based company named Hanne Ulaan LLC who we believe to be involved.

It appears we aren’t the only ones to have looked into this company, according to the 2021 UN report, Choi Chon Gon (Mr. Choi) is a resident of the Russian federation and traveled to Mongolia in January 2019 for the purpose of setting up Hanne Ulaan LLC. Following the Mongolian investigations, it was noted that the company’s registration documentation was forwarded to an address in Moscow that matches that of the embassy of the DPRK. Subsequently, Hanne Ulaan LLC has been identified as a DPRK front company for the purpose of evading sanctions and was subject to frozen bank accounts by the Mongolian authorities.

Russian & Bulgarian involvement

Through Pyongyang Papers sources, we understand that Choi Chon Gon the general director of Mongolia-based Hanne Ulaan LLC worked with a Bulgarian based company named StaCom Inc. Ltd to purchase Russia-origin coking coal worth millions of dollars. Enabling the regime to produce steel, likely for their weapons program and the construction industry. StaCom Inc. Ltd is an exporter of coal, coke & petroleum products and have been trading since 1990. Stayko Georgiev Staykov is listed as the manager of StaCom Inc. Ltd with the company name appearing to change several times since 1990. Its clear StaCom place profit margins above the UN’s desire to stop the regimes ambitions for global instability. Even though the companies Bulgarian registry listing states they “trade in coal and coke, as well as any other activity with goods and services not prohibited by law.”

We believe that Mr. Choi is an associate of an individual named So Myong, a Hanne Ulaan, LLC representative located at the DPRK consulate in Vladivostok, Russia, involved with large deliveries of coking coal. There remains the question of how the commodity makes its way to DPRK, it is known that this is done through ship to ship transfers and we suspect that the port of Posyet may be used for loading the product before it makes its journey towards North Korea. Posyet port is conveniently located just north of the North Korea-Russia border on the east coast, making logistics fairly straightforward.

Posyet Port, Russia.

China

As Pyongyang Papers has previously mentioned, China remains one of the DPRK’s key allies in illicit trade deals. It has been reported that China is currently experiencing coal shortages due to a reduction in imports and decreased domestic production. The DPRK are all too willing to aid their energy-hungry neighbor and continue to export coal across the border.

When investigating Hanne Ulaan, LLC, Pyongyang Papers came across additional illicit activity in Mongolia. We have found that a likely DPRK front company named Uran Tech LLC, located in Mongolia, is to sell 50,000 metric tons of coal to the Dandong based Chinese trading corporation China Dandong Jinquan Import and Export Trading Co., Ltd. (丹东金泉进出口贸易有限公司). Dandong is the largest Chinese border city located on the western border of North Korea, facing Sinuiju, North Korea, with the two cities connected by the Sino-Korean Friendship Bridge. It is hardly a surprise that this would be likely location for cooperation between DPRK and China and we have previously reported on the use of Dandong in many illicit DPRK-China trade deals. The Mongolia-based North Korean official Han Cho’ng-kyu is to share commission with a Chinese business partner Tian Mingxing on the deal which is worth nearly $3 million.

What it all burns down to?

Pyongyang Papers investigations once again show how the regime continue to prevail in their sanction breaking activity. There is no doubt that what has been highlighted above is only a small portion of the overall activity and with so much revenue generated, the regime will not be burning out any time soon. It remains a sad and desperate image of the regime as they continue to focus on fueling their weapons program rather than looking after the health & prosperity of their people. Especially as recent reports from the regime have confirmed a surge in potential COVID-19 cases. Pyongyang Papers will continue to highlight the illegal activity involving the DPRK. If you have any information related to this activity that could expose the DPRK, please do contact us.

An ever-changing global climate forces people, organizations and countries to consistently adapt to new challenges and explore new opportunities in order to survive, thrive and generate income. This is certainly the case for the DPRK, who continuously seek new methods to generate funds for their prohibited nuclear and ballistic missile program.

Due to the United Nations, US and European Union sanctions and more recently, the global pandemic, revenue generated by the more traditional route of smuggling illicit goods and services have seen a reduction in cash for the North Korean regime. The DPRK’s money pot is draining, its ongoing humanitarian crisis shows no signs of improving and so Kim Jong Un and the regime have looked to expand & established new strategies to generate a steady flow of income.

As usual, the DPRK’s answer to its self-imposed problems involves some form of crime, corruption and exploitation. This time, the method they have chosen is state sponsored cyber crime.

A commonly known phrase for cyber actors/groups is Advanced Persistent Threat (APT), often state sponsored with specific goals. DPRK’s motivation for such groups is theft of knowledge (intellectual property) and money with a number of groups being active for many years.

The United Nations Panel of Experts report from March 2021 stated that DPRK sponsored cyber crime both directly and indirectly supports the countries weapons of mass destruction and ballistic missile program. So here at Pyongyang Papers we have decided to investigate further and shed light on Kim Jong Un’s money-making scheme and the criminals behind it.

Cyber crime- how do they do it?

Cyber actors can sit within a relatively safe environment (as long as they are producing money for the regime) and hack/attack companies or institutions thousands of miles away, often without being detected until its too late. the tools being used by these actors are silent and very effective.

Money laundering, extortion and hacking are all illegal activities that the DPRK has become proficient in, and are being used to target many organizations. The victims of these cyber attacks are often banking and financial institutions, who they steal millions from with little risk of being caught. The August 2019 Panel of Expert Report states that nearly $2 billion was gained by DPRK through illegal activities with $541 million attributed to cryptocurrency theft alone.

Pyongyang Papers ask the question – how and where have North Korea learnt to be so proficient at cyber crime? It will come as no surprise, when researching how the DPRK cyber actors come to acquire such skills, that China is involved. We have reported previously on the ongoing relationship between the two countries. How China keeps close ties with the DPRK to leverage their global economic stance. It is thought the DPRK cyber actors are sent vocationally to Shenyang, China for ‘special’ training. Also, how does a country with one of the smallest internet presences in the world manage to cause such chaos? There are two options – cyber actors working on foreign soil under the cover of IT workers and cyber actors based on the DPRK/China border using Chinese internet access. It is therefore highly likely that Chinese Government are aware and therefore complicit in their neighbors’ illegal activities.

Moving the Money

So, how does the revenue generated from this kind of activity find its way into the DPRK banking system?

The movement of the unlawful cyber rewards can involve an elaborate web of associates, organizations and countries that are all witting contributors to the bank of Kim Jong Un, either financial or logistical.

As reported in the diplomat, in December 2021, North Korea will often use over the counter (OTC) brokers to cash out stolen cryptocurrency funds into normal currency through financial systems they can no longer legally access. OTC brokers specialize in facilitating cryptocurrency transactions and transfers for their clients.

The well-publicized cryptocurrency exchange hack from 2018, was laundered by two Chinese individuals, Tian Yinyin and Li Jiadong. Both were named in a US Treasury press release and were linked to the DPRK cyber group – LAZARUS (APT38). Tian and Li received $100 million and transferred the currency among accounts they held, hiding the origin of the funds for the regime. These two individuals are now on the sanctions list. The Lazarus group is believed to be a North Korean state sponsored hacking organization who have been active since around 2009. The group has been attributed to many large and sophisticated cyber attacks, including the recent attack on the computer game Axie Infinity. The attackers stole more than $600 million before being discovered and are still believed to be laundering the stolen cryptocurrency by moving it beyond the reach of authorities.

US Treasury image displaying the flow of stolen money

Pyongyang Papers have been informed that APT cyber actors are now hacking other cryptocurrency exchange’s, this time in Turkey and altering customer information to steal funds for the regime. We are looking into this further to see if we can find out any more information.

Altering customer information, allows the DPRK cyber actors to access cryptocurrency exchange accounts and transfer cryptocurrency from the hacked account to actor-controlled wallets with the funds eventually making their way back to the regime.

DPRK have close links with many countries throughout the world. They depend on their support, trade, friendship and above all their money. These countries are being targeted and attacked by the very institution that depends on them. It’s time that they woke up to the antics of a so-called friend, tightened up on security and review their relationship and their ultimate unwitting contribution in funding to the ballistic missile programs.

If you are aware of any DPRK APT individual or group that is involved in this illegal activity, please contact us.