Suspicion over sale of de facto North Korean embassy in Tokyo

A former Chinese diplomat once named as a spy in Japan's parliament has business links to an obscure firm that has purchased the de facto North Korean embassy in Tokyo.

Wang Xinghu, who was previously stationed at the Chinese embassy but claims to have become a businessman, has set up a consultancy called HKS Japan with Takeharu Inamura, a Japanese national, according to records seen by the South China Morning Post.

It emerged last week that Inamura's other company, a small warehousing firm that is called Green Forest, paid ¥4.4 billion (HK$290.7 million) to buy Pyongyang's biggest asset in Japan, the headquarters of the quasi-official Chongryon organisation.

But Green Forest has limited resources and experience in the property sector, and questions are being asked about where the firm acquired the cash.

Chongryon's imposing headquarters was initially put up for auction in 2012 at the request of the Japanese government's debt collection agency after the association for North Korean residents of Japan defaulted on debts of more than ¥62 billion.

After two initial attempts to purchase the building fell through - one by a religious group with links to an organised crime gang with North Korean members and the second a shell company based in Mongolia but with no assets and no traceable history - the property was sold last year to Marunaka Holdings, a Japanese construction company.

After paying ¥2.21 billion for the building and demanding that Chongryon vacate it so the plot could be redeveloped, Marunaka suddenly changed its mind and sold the property - for ¥4.4 billion and a swift profit - to Inamura's company, which is based in rural Yamagata Prefecture, has no history or licence to operate in the real-estate sector. Its annual turnover is a paltry ¥19 million.

In corporate documents, Chongryon is now listed as the mortgagee and will be allowed to remain in the property. The sale took place on January 28.

Phone calls to the offices of both HKS Japan and Green Forest were not answered. Local media have reported that Inamura lives in a small rented apartment in Tokyo's Nakano district, but the curtains have remained drawn and the lights off since the deal was revealed.

Wang - who was named by Japanese politician Katsuei Hirasawa in the Diet in July 2012 as a Chinese spy - is apparently out of the country. Hirasawa is a former official of the Japanese police whose responsibilities primarily focused on foreign intelligence issues. At the time Hirasawa made his allegations, the Sankei Shimbun reported Wang was a member of to China's Ministry of State Security.

Chongryon is also refusing to talk to the Post.

A Japanese human rights activist who is demanding that more international pressure be applied to the North Korean regime says he believed China was involved in the transaction.

"Wang cannot fund the Chongryon headquarters deal without the consent and financing of the Chinese government," claimed Ken Kato, director of Human Rights in Asia and a member of the International Coalition to Stop Crimes Against Humanity in North Korea.

"It is a mystery why China has decided to spend billions of yen to save Chongryon's face," he added. "I am sure that China understands that once their involvement in the deal is revealed, it will anger the Japanese public.

"The Chongryon HQ was sold not because of 'discrimination' or 'persecution,' as they are insisting," he added. "It was sold because they refused to pay back a debt that Japanese taxpayers were forced to shoulder."

Kato is indignant North Korea is refusing to honour its debts in Japan despite spending vast sums on nuclear and ballistic missile programmes.

There have been several years of friction between China and erstwhile ally North Korea, and if Beijing funded the purchase of the building, it could be a sign that China wants to get the relationship back on track.

Beijing was angered when Pyongyang ignored its pressure to not go ahead with a third underground nuclear test in 2013 and, subsequently, a series of missile test-launches.

Since Beijing got tough on the regime of Kim Jong-un - including halting all supplies of fuel oil - North Korea turned its attentions to Russia and has been busily courting its new ally. Moscow and Pyongyang have agreed to carry out a series of military drills this year, major Russian investment in North Korean infrastructure is under way, and Kim has reportedly accepted an invitation to attend a ceremony marking the end of the second world war in Moscow in May.