It is well documented that the DPRK regime and its associates across the world use ever changing methods to evade sanctions imposed on the hermit state in pursuit of its nuclear and ballistic weapons program. Although not a new practice, Pyongyang Papers has been looking at the use of shell companies to disguise business links with the DPRK.

Shell companies

A shell corporation is a corporation without active business operations or significant assets and although they are legal in principle, they can often be used illegitimately and for criminal intent. Setting up a Shell company is relatively easy as it does not often require identification or paperwork- perfect when dealing with the DPRK! Shell companies are also comparatively cheap to create, so can be used as a simple and efficient way to hide the ‘parent’ company and therefore save a business reputation and scrutiny from the authorities.

Shell companies are widely used to disguise DPRK associated business with the purpose of raising funds for the prohibited nuclear and ballistic missile programs.

Cheng Chiun Shipping Agency

Pyongyang Papers has been investigating one such company- Cheng Chiun Shipping Agency (CCSA). This company has created a number of shell companies in an attempt to obfuscate their impending oil purchases and shipments to the DPRK. These shell companies, called: Jaguar Trading Corp., Everway Global Ltd., and Galaxy Trading Corp have themselves joined forces to create a Hong Kong registered company- Hong Yao International Trade Co., Ltd. This further muddies the already murky waters of shell companies with added additional complications to our investigation.

So, what is Hong Yao International Trade Co., Ltd up to? Pyongyang Papers has been informed that the company has teamed up with Wintak Petrochemical Group Ltd., and Hang Yao International Trade Co., Ltd are working together to supply between 8,000 and 24,000 metric tons of oil per month, to the DPRK, which contravenes United Nations Security Council Resolution ( UNSCR) 2397.

UNSCR 2397 limits the DPRK’s imports of refined petroleum to 500,000 barrels for a 12-month period effective from 1 January 2018, all of which need to be logged and reported. A recent report by RUSI, indicates that Nampo- the country’s main port- between May and November have likely breached the annual petroleum import-cap, despite the borders being closed for extended periods due to the COVID-19 pandemic.

Companies & Ships

Hong Yao recent dealings include working with an individual named Hsiao Tsung-han, Tsung-han is the ship controller of Palau-flagged “Sky Venus” (IMO: 9168257). This tanker has sailed under multiple different names previously and is being used by Hong Yao International Trade Co., Ltd to transport the cargo oil from Taichung Oil Depot, Taiwan. The storage at the port is administered by Wintak. The “Sky Venus” heads north from the port to rendezvous with, and transfer her shipment via ship to ship transfer to the Cook Island-flagged tanker “Hai Jun” (IMO:9054896) that previously sailed under the name MITOYO MARU.

Through our investigation, we understand that CCSA have recently passed ownership of Sky Venus (IMO:9168257) between two of its shell companies, Ocean Energy International Corp. have sold the vessel to a company Wills International Co., Ltd. You may remember that Wills International Co., Ltd. previously appeared in our article about the Panama flagged vessel “SUNWARD“. Was this used to hide the connection between the companies and vessels? Pyongyang Papers wonders if there are may be more going on here?

The “New Konk” (IMO:9036387)

To obfuscate illicit activity further “Hai Jun” transferred the oil to a tanker named “New Konk” (IMO:9036387). The New Konk is not a NK registered vessel but has been identified by the UN PoE as a ship to ship transfer vessel with the PoE recommending the ship to be banned from any UN designation port. She was de-registered from the Sierra Leone flag registry in October 2019 so therefore now ‘flag-less’.

After receiving the cargo, New Konk met with and transferred her shipment to North Korean flagged “Yu Son” and “Kum Jin Gang 3”. These vessels would travel the final leg of the journey back to the DPRK. Much like the use of shell companies, deceptive shipping practices involving swapping vessel identities is just another method used by the DPRK and its accomplices to try and mask their sanction breaking activities. The UN PoE report details how the New Konk has also been involved in these activities, sailing under a different name and transmitted a fraudulent maritime mobile service identity number at some time in 2020.

The bank of Kim Jong Un

This investigation started with Pyongyang Papers looking into the setting-up of a Shell companies and the reasons behind their creation but quickly led to an investigation involving a number of individuals and entities supplying the DPRK and ultimately contributing to the funding of the nuclear and ballistic weapons program.

Pyongyang Papers have reported on six shell companies associated with this company or any other DPRK entity that are acting as a facilitator for the bank of Kim Jong Un, or indeed any other sanctioned activity, please get in touch.

The totalitarian state of North Korea is renowned for conducting illicit activities and trade deals in order to continue funding its ballistic and nuclear weapons program, often with the assistance of neighboring countries who are looking to make a quick profit despite UN sanctions. Pyongyang Papers has investigated the DPRK’s involvement in a range of illicit activities including coal exports, wildlife trafficking, import of luxury goods and overseas workers. Our latest investigation looks at a river sand contract worth up to $10 million between the DPRK and its favorite trading partner, China.

Why sand?

Sand is one of the most important commodities in the world with the smallest appreciation space. Sand is very commonly used in construction, often providing bulk, strength and stability to other materials such as asphalt, concrete, mortar, render, cement and creed. It is the most consumed raw material besides water and is needed to build roads, bridges and trains.

The sand that covers the world’s deserts is too fine to use in construction because it doesn’t bind well. River sand is typically the best for making cement- which is where North Korea come into play.

Pyongyang has seemingly cashed in on the sand trade for many years. In previous years, when North and South Korea did significant business together, sand was Pyongyang’s most valuable export to its southern neighbor, according to media reports at the time. North Korea sold $73.35 million worth of sand to the Republic of Korea in 2008, though South Korea stopped buying North Korean sand shortly after.

But there’s an even more important customer bordering North Korea: China. China is the world’s largest consumer of sand, accounting for about half of the world’s total, with an annual consumption of up to 20 billion tons.

During the 2010’s, the country underwent a construction boom unprecedented in world history- Beijing used more concrete between 2011 and 2013 than the United States did in the entire 20th century.

Tan Wee Beng

North Korea is banned from exporting earth and stone under the United Nations sanctions passed in December 2017.

However, here at Pyongyang Papers we believe that DPRK-controlled, Singapore-registered Singapore Morgan Marcos Co., LTD is involved in a sanction-breaking deal involving the export of sand to China.

This wouldn’t be the first time that Morgan Marcos Co., LTD has been involved in dodgy dealings with the DPRK.

Morgan Marcos Pte. Ltd. is an Exempt Private Company Limited by Shares, incorporated on 22 January 2008 in Singapore. The address of the companies registered office is at the WEE TIONG BUILDING. The Company’s current operating status is live and has been operating for 14 years. The Company’s principal activity is collective portfolio investment funds with rental income.

Morgan Marcos Pte LTD is the sister company to commodity trading company Wee Tiong (S) Pte Ltd to whom Tan Wee Beng is the managing director and shareholder, along with his other business WT Marine.

Tan Wee Beng, a 44 year old Singaporean who also goes by the names “WB” and “Marcus Tan”, is described as a prominent young executive with a taste for expensive sports cars. However, that’s isn’t all he’s known for, you can also find Beng on the United States’ Federal Bureau of Investigation’s (FBI) most wanted list for money laundering and violating the International Emergency Economic Powers Act (IEEPA) by doing business with North Korea.

During October 2021, Beng was fined $210,000 by a Singapore Court for falsifying invoices linked to business in North Korea. According to the Singaporean police department, Wee Tiong (S) Pte Ltd sold sugar and other goods to two persons from the DPRK through their respective companies prior to 2017, with payments made to Wee Tiong (S) Pte Ltd and its related company, Morgan Marcos Pte Ltd.

Tan Wee Beng wanted by FBI

Investigations by the Commercial Affairs Department revealed that between November 2016 and October 2017, Tan Wee Beng received queries from two banks about deposits made to Wee Tiong (S) Pte Ltd and Morgan Marcos Pte Ltd. These deposits were payments for sales of goods to the DPRK persons. Although these deals were made prior to the UN sanctions embargo, Tan Wee Beng was concerned that the banks would terminate their relationship with the companies if either bank found out that Wee Tiong (S) Pte Ltd had transacted with entities linked to the DPRK.

To conceal this from the banks, Tan Wee Beng falsified the invoice of both companies. The names of the end buyers, and in some cases, the destination ports on these invoices, were changed to remove any links to the DPRK. Tan Wee Beng then signed the false invoices and submitted them to the banks, which ultimately resulted in money laundering charges.

Yalu River

It seems despite recent trouble with law enforcement, our sources inform us that a deal involving Morgan Marcos Co., Ltd sees 5 million cubic meters of river sand from the Yalu river destined for Chinese waters, which is in complete violation of UN sanctions.

The Yalu River, known by Koreans as the “Amrok River” or “Amrok Ocean”, is a river that separates the North Korean town of Sinuiju from China’ border in Dandong.

Daily NK reported in April how the economic hardship caused by the COVID-19 pandemic seemed to be easing in North Korea, as North Korean ships were spotted back on the Yalu River collecting sand. Pyongyang Papers wonders if this sand being collected was in fact to be sold via illicit transactions to further fund their deadly weapons?

It seems that DPRK medical staff are still trading in Africa, this time in Ghana! Partnerships have been formed between Ghanaian & DPRK countries with the knowledge of the Ghanaian Government. Specifically, the Ghanaian Ministry of Health, who are aware of the illicit dealings.

The long-standing relationships between North Korea and many African countries is well known. From the Zimbabwean leader Mugabe sending gifts of live rhinos to Pyongyang, to Uganda’s Museveni learning Korean from Kim Jong Un’s grandfather. Over time, these relationships seem to have grown with North Korea providing weapons, soldiers, labor and completing ambitious construction projects for many African countries.

The recent United Nations Panel of Experts report notes that there is a significant and ongoing financial activity related to the illicit labor networks in sub-Saharan Africa. It’s clear the DPRK haven’t learnt a lesson from the imposed sanctions! There has been an extremely high number of African countries reporting late to the UN or not at all. This is despite sanctions and an obligation to report effects to enforce them. The reasons behind this may be innocent but it seems likely that it is down to the difficulty in hiding these exchanges that continue to exist between Africa and the DPRK. As of 2016, only 15 percent of African UN members were complying with reporting requirements so the UN investigated the possible sanctions violations by 7 African countries.

DPRK workers in Ghana

While investigating DPRK workers in Africa, Pyongyang Papers has found information surrounding a partnership between Ghana and the DPRK. While countries like Angola cooperated with the UN sanctions and repatriated 296 DPRK nationals, Ghana seem to be aware of and is encouraging sanctions breaking behavior. Given that Ghana and the DPRK have maintained diplomatic relations since 1964 it is hardly surprising that the countries are willing to work together to avoid sanctions!

Pyongyang Papers has discovered that a partnership has been agreed between Buhung Traditional Medical Centre, which lists Ri So’ng il as its director and the Prestige Herbal Clinic. The Prestige Herbal Clinic based in the Amasaman area of Accra, Ghana and offers alternative medicinal treatment for a range of ailments using herbal, massage and detoxification techniques. The CEO is listed as Mr Van Klu and Prestige Herbal Clinic claim to have access to specialist herbal practitioners with years of experience and in-house laboratory. Pyongyang Papers contacted Prestige Herbal Clinic for comment, at the time of publication we had not received a response.

The Prestige Herbal Clinic based in the Amasaman area of Accra, Ghana

Pyongyang Papers has also been informed that Pak Kwang-hyo’k, a representative of the DPRK Korea Moranbong Medical Cooperation Centre was involved in brokering the deal with the knowledge of the Ghanaian Ministry of Health. Pyongyang papers has come across the Moranbong Medical Cooperation Centre previously when investigating DPRK doctors in Africa.

As Pyongyang Papers has previously highlighted, there have been many issues with north Korean medical staff working in Africa. These low paid and sometimes poorly trained medical staff from the DPRK have been involved in incidents of malpractice and even subjecting patients to illegal procedures. The humanitarian situation in the DPRK is dire and does not seem to be getting better. The most recent Panel of Experts report claims that the DPRK prioritizes the regime over national priorities that include food security, health and medical services. Instead of addressing the problems in their own county the DPRK is sending its medical staff to other countries and aiding them. Ghana owns one of the most developed medical and healthcare systems in Africa… Pyongyang papers wants to know why is Ghana hiring DPRK medical staff if they are already capable?

The future of sanctions evasion

There would be implications on Ghana, and other African countries if they don’t comply with the sanctions imposed on North Korea. If other UN member states decide that African countries are not enforcing sanctions on DPRK, could their aid and other economic support be re-evaluated? The unilateral backing of the sanctions against DPRK is important to make sure they discourage the regime which is still engaging in human rights violations, ignoring their citizens in desperate need of basic provisions and actively pursuing nuclear programs with money earned abroad illicitly.

If you have any information relating to sanctions evasion by the DPRK then please contact Pyongyang Papers!

Diplomatic relations between the Soviet Union (the predecessor state to the Russian Federation) and North Korea date back to 1948, shortly after the Democratic People’s Republic of Korea was proclaimed. The relationship between the two countries continued even after the fall of the Soviet Union, with it gaining further importance when Vladimir Putin was elected President of Russia in 2000.

In the late 1940s, roughly 9,000 North Korean migrant workers were recruited by the Soviet government to work in state-owned fisheries on Sakhalin, with a further 25,000 workers following suit in the 1950s. A secret agreement between country rulers (Leonid Brezhnev and Kim Il Sung) saw a second wave in the 1960s, consisting mainly of criminals or political prisoners. The flow of workers from North Korea to Sakhalin continues to this day, as reported in our previous article.

By the mid-2000s, masses of North Koreans were still entering Russia on work visas to try to escape their poverty-stricken homeland. Often compared to slave labor by outsiders due to the relentless working hours and poor living conditions, on the contrary North Koreans view the chance to work in Russia as a lifeline for both themselves and their families.

Kim Jong Un and Vladimir Putin meet for the first time in 2019 in Vladivostock

Slave labor?

According to Russia’s labor ministry, North Koreans are paid on average $415 per month, 40% less than the average salary in Russia. With recent reports suggesting a sudden hike, up to 70% of these wages earned by the workers are reportedly seized as ‘loyalty payments’ by the regime, to help prop up the government and its falling economy. This leaves the workers with even less money than usual to cover their living costs and to help support their families back home. However, due to the prestige and limited opportunity for North Korean citizens to improve their quality of life in the DPRK, it is impossible to find a job in Russia without paying a bribe, meaning it is often the more affluent Pyongyang citizens who get the opportunities to work overseas, with the underprivileged remaining poor with no means to better their future.

According to Ministry of Labor statistics, more than 85% of North Korean migrants work in construction. The rest are involved in a range of jobs from garment wok and agriculture, to logging, catering and traditional medicine.

Sanction evasion

However, Kin Jong Un’s persistent refusal to stop its nuclear testing program resulted in enforced UN International sanctions in September 2017 ensuing an embargo on the use of North Korean labor.

Unsurprisingly, in recent years Moscow and Beijing have appealed unsuccessfully to the member states of the UN to overturn the sanctions, in the hope to reignite the steady flow of migrant workers into both countries. Russia admitted missing the repatriation deadline, and here at Pyongyang Papers we know that Moscow’s claims of complying with the embargo are not wholly true- instead North Koreans continue to enter Russia to work via a loophole.

As North Korean’s on worker’s visas leave Russia, more enter on tourism and education visas, which aren’t banned by sanctions. During the first 9 months of 2019, 12834 tourist visas and 7162 student visas were issued to North Koreans, each rising about six-fold and three-fold respectively from a year earlier, according to Russian government data. With experts concluding that many of these visitors are likely working in Russia.

Students or construction workers?

A recent Pyongyang Papers investigation has revealed that a Moscow-based construction company was planning on receiving at least 100 student trainees to work on Moscow build projects.

BS Installation, LLC was founded in 2017 as a construction company with many projects under its belt. Also, plans are being discussed on sending student trainees to work on Moscow build projects for practical training.

Pyongyang Papers believes that Pyongyang will select the first group of 100 student trainees to arrive in Russia to work on projects in and around the Moscow area, following agreement between Russia’s SitiStroyProyekt, LLC, (СитиСтройПроект) an architectural planning company whose activities consist of engineering design and construction project management based in St Petersburg, and DPRK General Construction Company “Pyongyang” (Pyongyang). The agreement is believed to last until mid-2023.

Pyongyang Papers understand that this is based on a 2007 agreement between Russia and North Korea for temporary labor of the citizens of one government in the territory of the other to improve North Korean students’ professional skills whilst ‘studying’ in Russia.

Turning a blind eye

It seems the DPRK continue to ignore the UN sanctions enforced against them. Possibly partly to fund an ambitious building project under Kim Jong Un’s direction. Kim Jong Un promised in January to alleviate the capital’s housing shortage with 50,000 new homes by the end of 2025, including 10,000 in 2021 at the ruling Korean Workers’ Party.

It appears Russia is trying to turn a blind eye to the North Korean workers that continue to work in their country, but what will become of the regimes ballistic missile plans should we all continue to ignore the DPRK’s actions. Pyongyang Papers pledge to continue to highlight both countries and companies enabling sanction violations- as always please contact us if you have any information.

Despite the UN Security Council imposed sanctions, there is plenty of evidence to suggest that trading and business still happens as usual for the DPRK regime. The United Nations Security Council Panel of Experts reports everything from refined petroleum to military equipment and even foreign alcoholic beverages can be found in a department store in downtown Pyongyang. As shown in our previous article, luxury goods are still managing to make their way into the DPRK through a variety of different methods.

Old Methods Still Used

Individuals trying to avoid sanctions have been seen using clever methods but often quite obvious tactics get these goods across seas and through borders. Pyongyang Papers has written several articles featuring the commonly used methods including ship-to-ship transfers and direct tanker deliveries sailing under foreign flags. The March 2021 Panel of Experts report even notes a recorded instance of a vessel making up to 9 return visits over a six-month period.

Pyongyang Papers has previously investigated DPRK citizens working overseas in different roles to generate funds to support the regime back at home and its nuclear ballistic missiles program. It seems there are no end of individuals who are willing to break sanctions in the pursuit of money. Through Pyongyang Papers sources and our investigations, we can now name a number of individuals that are part of a group involved in breaching sanctions and raising funds for the DPRK regime.

Vessels in use to smuggle to DPRK

A report to Pyongyang Papers has highlighted sanction breaking behavior by a Taiwanese criminal group headed by Huang Chung-wei with money laundering activities headed by husband and wife duo, Chu Hua-sheng and Liu Chung-hsuan. This group has been working with another Taiwanese citizen by the name of “Allen” Yu Ping-yuan to carry out smuggling activities to support the DPRK regime despite UN sanctions.

Chen Shih-huan is also involved with this criminal group using an oil tanker called COURAGEOUS with IMO 8617524, a vessel used to smuggle sanctioned oil cargo to DPRK tankers. The most recent Panel of expert’s report, released in March 2021, details how the unknown-flagged tanker SEA PRIMA (also known as COURAGEOUS) conducted ship-to-ship transfers with designated DPRK tankers in both August and September of 2019. In March 2020, Cambodian authorities detained the SEA PRIMA sailing as the COURAGEOUS.

The Crew members of the COURAGEOUS involved in ship-to-ship transfers with North Korea in violation of UN Sanctions

More recent reports from Mehr News Agency suggest that the United States seized the Singapore owned oil tanker and that the owner Kwek Kee Seng is facing criminal charges of conspiracy to evade economic sanctions on the DPRK along with conspiracy of money laundering. The statement did not say why the charges against Kwek had not been brought more than a year after the ship was seized but added that a New York federal court had entered judgement of forfeiture regarding the vessel.

Pyongyang Papers wonder how the seizure of the COURAGEOUS has affected Huang and his criminal gang?

It isn’t just Taiwan-based individuals and organizations involved. The August 2020 and March 2021 reports show various allegations against countries including the Republic of Korea, Namibia, Nigeria and Guinea. As highlighted in the UN Panel of Experts reports by several non-governmental organizations, the sanctions have no doubt had a negative impact on the civilian population in many ways. One example is the civilians of North Korea have limited agricultural resources such as transportation, machinery, fertilizers, and an overall decreasing food security especially throughout the COVID-19 pandemic. The same goes for the acquisition of coal and petroleum; there are instances of foreign-flagged tanker deliveries being made to DPRK through companies who changed ownership or dissolved just months beforehand in an attempt to confuse or hide the fact that sanctions are being ignored. These products don’t seem to be used for the benefit of the people, but rather to support the industries building ballistic missiles and other weapons.

If you have any information about DPRK sanctions evasion please contact Pyongyang Papers.

Smoking and North Korea go hand in hand. According to a World Health Organization report in 2019, 46.1% of males above the age of 15 smoke tobacco, and the numbers have been high for years.

Tobacco was first introduced in Korea in the early 1600s from Japan, and until around the 1800s, both men and women smoked profusely. Today, smoking is still a frequent and expected activity for North Korean men, yet female smoking is now considered a taboo.

Although it may be unthinkable for females, Pyongyang have no objections with one of its local residents at the capital’s zoo lighting up a cigarette. Azalea (Korean name “Dallae”), a smoking chimpanzee, is the star attraction at the zoo and regularly has citizens roaring with laughter as she puffs away on a pack of cigarettes a day, despite outrage from several animal rights activists. This, another clear display of total disregard towards animal welfare and an appalling attitude towards a deadly habit that unfortunately we have come to expect from the DPRK.

Azalea, as seen in the image below, isn’t the only prominent figure in the DPRK with a cigarette always in hand, North Korean leader Kim Jong Un is regularly photographed smoking on his public outings, despite the many health concerns it entails.

Smoking is a leading cause of death in North Korea, and as of 2010 mortality figures indicated that 34% of men and 22% of women die due to smoking related causes. This is the highest smoking related mortality figures in the world and these figures have only continued to rise.

The numbers are so concerning that Pyongyang introduced the tobacco prohibition law in November 2020. The tobacco prohibition law prevents North Korean’s from smoking in public places and sets out rules to provide a ‘more cultured and hygienic’ environment for citizens. It has also apparently been introduced to tighten the legal and social controls on the production and sale of cigarettes.

We are yet to confirm if Kim Jong Un is leading by example and quitting the tobacco since introducing the prohibition law. However, here at Pyongyang Papers we can confirm that North Korea’s illicit tobacco trade with other member states continues to burn on.

Ryugyong Corporation

Pyongyang Papers have previously investigated the significant role that North Korean cigarette manufacturing company Ryugyong Corporation has played in the DPRK revenue generating machine. It is an arm of the central government, subordinate to the Korea Worker’s Party Finance and Accounting Department (Bureau 125), which handles budgetary and accounting matters for the regime.

Ryugyong Corporation may sit at the heart of the criminal global network but they do not operate alone. Our sources have informed us that Chinese tobacco company Poly Tobacco International Limited and Ryugyong Corporation have conducted business amounting to hundreds of tonnes of tobacco leaves and ancillaries worth millions of dollars. This contravenes the imposed UN Resolution which prohibits the importation and/or facilitation of luxury goods (like tobacco) into North Korea.

Poly Tobacco International Limited used Chang Myo’ng Sik, a Dalian-based representative of the Liaoning Pilot Free Trade Zone Manrong International Trade Co., Ltd as a third-party payee.

Dalian

This is not the first time Dalian (a port city in Northeast China, close to North Korea) has been linked with involvement of the illicit tobacco trade. In 2016, Nikkei Asia published an article which detailed how two shipping containers with cartons of legitimate North Korean cigarettes concealed packs of pirated Marlboro’s. The Manila shipment, seized in October 2013, included 8.79 million counterfeit Marlboro s in 439,000 packs; the shipment in Malta in June 2014 held 8.16 million sticks in 413,999 packs. A source put the street value of the two shipments at $4.2 million to $8.4 million.

According to shipping documents, the sender for both shipments was Dalian based company ‘Sun Moon Star Trading‘.

Naxiades

As previously reported by Pyongyang Papers, Ryugyong has also had dealings with Greek trading house Zafiris Naxiades (ΖΑΦΕΙΡΙΟΣ ΖΑΞΙΑΔΗΣ), based in Thessaloniki. Despite our previous investigation exposing their illegal activity we can confirm Naxiades continues to facilitate the sale of tobacco and flavorings to North Korea.

Pyongyang Papers have been informed Zafiris Naxiades also hosted a North Korean tobacco delegation at the Hotel Panorama in Thessaloniki in October 2019, shown below.

Funding the nukes and the DPRK elites

The regime relies on unlawful activities (such as the manufacture and sale of illegal drugs, counterfeit consumer goods, human trafficking, arms trafficking, wildlife trafficking, counterfeit currency and terrorism) and willing co-conspirators to continue to provide a steady source of income for its nuclear weapon program and to maintain the lifestyle of the countries elite. Clearly the citizens who do not form part of Pyongyang’s elite are not deemed worthy of this funding, as they continue to battle the ongoing humanitarian and health crisis that has plagued North Korea since the early 1900s.

Compared with drugs, smuggling tobacco is low-risk and high reward. The illicit tobacco trade is one of the most lucrative revenue streams for the Kim regime, an industry worth tens of billions of dollars worldwide since the product can be sold without the high taxes that exist in many wealthy countries.

Whilst many North Korean factories appear to have been hit hard by sanctions, it appears the tobacco factories and nuclear weapon funds are still thriving. As always, Pyongyang Papers pledges to continue to expose those who choose to collaborate and profit from the DPRK’s sanction breaking behavior and campaign for the human rights of the oblivious nationals held captive by the relentless Kim dynasty.

Since 2017 the United Nations has listed coal amongst the goods and services sanctioned against North Korea as shown in our previous article. The security council declared that the “DPRK shall not supply, sell or transfer, directly or indirectly from its territory any coal”. The resolutions go on to say “all states shall prohibit the procurement of such material from the DPRK”.

Despite UN sanctions, trade in coal continued to be a huge revenue generator for the regime, with the DPRK continuing to export the coal illegally via deceptive maritime practices such as ship to ship transfers. This trade contributes vast sums of money to aid the DPRK regime in its proliferation of prohibited nuclear and ballistic missile program. Coal is North Korea major export and foreign currency earner with most of North Korea’s coal being 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.

Due to the worldwide COVID-19 pandemic, North Korea shut its borders in early 2020, resulting in a decrease in trade of up to 81%. However, it has been reported that trade between North Korea and China has resumed as of April 2021, with no doubt coal being a priority for the DPRK.

Chinese Involvement

Pyongyang papers has been investigating Chinese involvement in helping break sanctions against North Korea for some time. In 2016 police in China announced a criminal investigation into Chinese company that conducts extensive trade with North Korea. During this investigation Chinese authorities discovered that for a long time a company named Dandong Hongxiang Industrial Development Co. Ltd. engaged is suspected economic crimes during trading activities.

Dandong is the largest Chinese border city and located on the western border of North Korea, facing Sinuiju, North Korea, with the two cities connected by the Sino-Korean friendship bridge along with rail links to Shenyang and Sinuiju. Dandong Hongxiang Industrial Development operates the commodity distribution business and has a number of front companies associated with it. Dandong Hongxiang was sanctioned by the US in September 2016 and Dandong Hongxiang personnel were indicted by the US on sanctions evasion charges in June 2019. It appears that the head of Dandong Hongxiang, Ma Xiaohong, and a number of her colleagues were accused of violating the international Emergency Economic Powers Act on a conspiracy to defraud the United States and launder money. According to the indictment, Dandong Hongxiang is a Chinese company whose core business was trade with North Korea, and had at its disposal at least 20 front companies to obscure illicit financial dealings on behalf of sanctioned DPRK entities that were involved in the proliferation of weapons of mass destruction.

Ma Xiaohong, head of Dandong Hongxiang

Pyongyang Papers has received information about Dandong Hongxiang’s recent sanctions breaking activity. Our investigation would suggest that Dandong Hongxiang have not learnt from the past and have used the Chinese vessel “Hong Rui 8899” for the transportation of anthracite coal from Taean Port, North Korea. Korea Hangsong Trading Corporation was listed as the shipping company for the cargo. During our investigation Pyongyang papers has also discovered another vessel involved in transporting anthracite coal this time through Daean Port. The “Jang An” traveled from North Korea and performed a ship to ship transfer in the sea waters outside of Shanghai.

Reporting in the latest UN Panel of Experts report proves that the activity highlighted above is only the tip of the iceberg and with the DPRK regime suggesting that North Korean orphans are ‘volunteering’ to work in coal mines it is clear that the regime is willing to do anything to generate revenue. Even if this includes forced child labor and sanctions evasion!

If you have any information that could expose DPRK sanctions evasion, please get in touch.

There are many images of Kim Jong-Un enjoying a ride in a luxury sanctioned vehicle in recent years and the shops in Pyongyang appear to be filled with watches, champagne and high-end technology. It seems that despite sanctions on luxury goods, the DPRK is still able to overcome these to guarantee the best experiences for the elite or those willing to pay for it. Pyongyang Papers first reported on North Korea’s illicit luxury goods trade back in 2018, where we detailed North Korean brokers sourcing luxury goods for the elite whilst normal citizens within the country were struggling with fuel shortages that were crippling food supplies.

Breaking the rules

According to the Panel of Experts 2020 midterm report and the recent final report in March 2021, luxury vehicles have been found within the DPRK despite efforts by the manufacturers to try and stop this from happening. Manufacturers including Mercedes-Benz and Toyota (Lexus) have had their vehicles found in the country. Both UN reports mention Mercedes-Benz S-Class 600 Sedan Long Guard VR9s specifically and the final report adds Lexus vehicles to this list of sanctions breaking behavior. It seems that the Mercedes-Benz vehicles passed through multiple countries including Italy & the Netherlands to make it from the manufacturer and eventually into the DPRK.

It seems that this method of sanctions evasion is still ongoing! A source close to the supply chain confirmed to Pyongyang Papers that a shipment of luxury goods and vehicles, including several newly manufactured Lexus 570 SUV’s and a Mercedes-Benz AMG, along with more UN sanctioned goods worth in excess of $1.2 million was due to be delivered to Ningbo Beilun, China with onward travel to the DPRK. This is in breach of the UN resolution prohibiting the sale of luxury items to the DPRK. Ningbo Beilun has an international port which has been heavily invested in by the Chinese government, also showing a continued increase in revenue over time. Clearly it is getting well used by the DPRK!

Kim Jong-Un has been seen, in recent years, showcasing several Mercedes limousines as well as a Rolls Royce Phantom and Lexus. Add to this the images of Kim Jong Un’s wife, Ri Sol-Ju, carrying handbags made by Chanel and Dior. This is in complete contrast to the citizens of North Korea who are facing potential famine under the current situation in the country. Despite offers, the DPRK has refused international aid meant to help fix this humanitarian crisis. It is unfortunate that whilst these citizens suffer through the pandemic, the elite in DPRK are able to obtain seemingly vast quantities of luxury goods.

China and the DPRK

The relationship between China and the DPRK has not been straightforward during the period of enforced sanctions on DPRK. China voted in favor of United Nations sanctions against DPRK when the country carried out its first nuclear test even through the two countries signed the Sino-North Korean Mutual Aid and Cooperation Friendship Treaty in 1961. The treaty encourages economic cooperation between the two countries and could explain why it is common for China to have been found facilitating DPRK breaking sanctions along with the financial reward they will gain from the transaction. China is the largest trading partner of the DPRK which might also explain this illicit behavior!

Routes to smuggle DPRK sanctioned items have frequently involved China, as seen in the recent case of Lim Cheng Hwee, who was jailed for supplying alcohol to North Korea. Another report written by C4ADS in 2019 describes the techniques and lengths the regime are willing to go to evade sanctions and get luxury goods into the DPRK. This includes Mercedes vehicles being shipped through China!


As always, if you have any information about evasion of DPRK sanctions, please get in contact with Pyongyang Papers.

In December 2017, The UN Security Council implemented resolution 2397 as the DPRK regime were generating foreign export earnings to fund its ongoing missile related activities. The Security Council determined that the DPRK continues to exist as a clear threat to international peace and security and so the sanction was implemented requiring all member states to prohibit any North Korean nationals from engaging in business in foreign countries. At the same time the December 2019 deadline was agreed for the repatriation of all North Korean workers back to the DPRK.

Ballistic Missile Program

North Korea has had a keen interest in developing nuclear weapons since the 1950’s and the ballistic missile program initiated under the Kim dynasty continues today under Kim Jong Un’s regime. North Korea has developed and tested a number of new missiles since Kim Jong Un became leader in 2011, including tests of various models of solid fueled short range ballistic missiles taking place in recent years.

A North Korean missile launch – March 2020

Although you would think that countries within the UN would be fully on board with efforts to prevent the DPRK’s ballistic missile program, along with the threat of penalties for defying the UN enforced sanctions, this is unfortunately not the case. Pyongyang Papers has continued to investigate companies working with North Korea in illicit activity, no doubt hoping to go unnoticed.

UAE Residency Permits

Pyongyang Papers sources have received information that the Korea Kumgang Company, also known as Korea Konggang Company, employees Ri Jun MIn and So In Chol both received United Arab Emirates residency permits. Our sources understand that this was preparation for over 100 DPRK workers to travel to United Arab Emirates, which in turn would continue to provide the DPRK regime with foreign export earnings to fund its ballistic missile program.

The UAE has always been a strong ally of the US. However, it doesn’t seem that the UAE is carrying out their promise that they would no longer be issuing visas to North Korean nationals, as claimed by the UAE Foreign Ministry back in 2017.

Laos and Nepal

Pyongyang Papers has also received information that Ri Jun Min and So In Chol have been busy brokering another overseas worker deal, this time using the Nepal DPRK Embassy as a conduit to a Laos Government official to supply over 1000 workers. However, due to the COVID-19 pandemic, it is likely that the workers are still in North Korea with their cases packed waiting to travel!

Although it could be surprising that the UAE are violating sanctions, the same cannot be said for Nepal and Laos. According to a 2019 article describing the repatriation of North Korean workers, the Nepali communists have always had an admiration for the Workers Party of Korea and they view North Koreans as courageously fighting the imperialists, aligned to their own ideologies.

Only now has unrelenting American pressure to enforce UN sanctions against Pyongyang distanced Nepal from their North Korean comrades. The same article reports that most North Korean businesses in Nepal have been shut down and the workers sent home. The UN in Nepal had expressed worry that the North Korean businesses were sponsoring Pyongyang’s nuclear weapons development program.

Laos Cooperation Agreement

According to press releases in April 2020 the Foreign Ministries of Laos and North Korea signed a new cooperation agreement in Vientiane to replace the previously expired one. North Korea’s Ministry of Foreign Affairs (MFA) called it an agreement that ‘would make an important contribution to further consolidating and developing the friendly relations’. Laos also maintains an embassy in Pyongyang.

It seems no matter what sanctions are thrown at the DPRK, they always seem to find a way to evade them. However, this is only possible due to the help they receive from other countries who also violate the sanctions despite the pledged effort to denuclearize the DPRK. It is worrying that these countries seemingly prioritize the financial reward from these transactions above international peace and security, rather than standing up to the regime and its attempts to evade sanctions.

If you have any additional information about the Korea Kumgang Company or any other North Korean sanctions evasion please contact Pyongyang Papers.

A relationship between North Korea and Cambodia has been in place since 1965 when Cambodia’s Norodom Sihanouk met Kim-Il Sung. Even after Sihanouk lost his power in government the DPRK was still supportive. They built a palace for him and even provided bodyguards when he became king and returned to Cambodia. In more recent years the DPRK has invested in Cambodia’s Angkor Panorama Museum. The museum’s director Yit Chardaroat stated to Aljazeera “63 artists toiled for more than a year to complete the panorama”. The artists came from North Korea which designed, built and bankrolled the $24m project through the Mansudae Art Studio. According to the article, the first 10 years of profits are going straight to North Korea.

However the first sign of cracks in the country’s relationship started to appear a few years ago. Forbes reported that Cambodia rejected an official visit from North Korea’s Foreign Minister back in 2016. This was followed by reports of Pyongyang sending North Korean assassins to Cambodia to conduct terror attacks against South Koreans as well as the emergence that the Kim Jong Nam murder suspects used Cambodia for 3 practice runs of the attack. The relationship was certainly failing when other DPRK officials were also denied access. Perhaps all this was a result of North Koreas reckless approach to weapons, or it constant attempts to avoid sanctions and deny human rights abuses. Cambodia were certainly not only country to be severing ties.

A Change in Relationship

It appears the relationship between the two countries is now falling apart. The Korean Herald reported in January 2020 that Cambodia had shut down 7 North Korean businesses in the country, including the Angkor Panorama Museum which was staffed by North Koreans. This is all result of UN sanctions. Pyongyang Papers has also learned that as part of this crackdown North Korean IT workers are relocating to China from Cambodia. This just adds to the volume that are present in China. It is estimated that around 50,000 North Korean laborers are still in China which has been citing COVID-19 as the excuse for not repatriating these illegal workers.

The Angkor Panorama Museum

Our sources have revealed a group of IT developers led by an individual called Hwang Ju Yong have been forced to leave the country by the Cambodian government, along with other North Korean workers in Cambodia. They were working for the Chongsin Information Technology Company, based in Pyongyang. The majority of North Koreans in Cambodia have relocated to Yanji in North Eastern China. According to the UN Panel of Experts midterm report, hundreds of workers access to China was sponsored by the sanctioned entity Yanji Silver Star Network Technology Company LTD.

China Still Aiding Sanctions Evasion

Clearly, the DPRK and China still have no intention of abiding by the current sanctions. With North Korea benefiting from its workers abroad it looks like they will use whatever means necessary to generate revenue and China are happy to support this relationship. It has recently been reported that a 10 day quarantine process in designated accommodation has been set up in the Jilin Province facing the North Korean border. This is specifically for North Korean workers and proves that even with huge potential risks posed to its citizens the DPRK is happy to ignore sanctions in the pursuit of money for the regime.

Do you have information about Cambodia’s involvement with the DPRK? If you have any information about this or North Korean sanctions evasion please get in touch with Pyongyang Papers.