Top Chinese banks in spotlight as US investigates how North Korea finances its nuclear programme
- US prosecutors suspect state-owned North Korean bank used Chinese front company to export ‘hundreds of millions of dollars’ in coal and other minerals
- China Merchants Bank, Bank of Communications and Shanghai Pudong Development Bank to face daily US$50,000 fine for failing to comply with subpoenas
The US is investigating hundreds of millions of dollars in financial transactions involving three big Chinese banks that allegedly helped finance North Korea’s nuclear weapons programme, according to an appellate court opinion unsealed on Tuesday.
The July 30 ruling upheld an order by a Washington district-court judge forcing the banks to comply with subpoenas for information about the transactions.
The appellate court said prosecutors do not “currently” suspect the Chinese banks of knowingly breaking the law but that the banks “hold records that the United States government thinks may clarify how North Korea finances its nuclear weapons programme”.
US prosecutors suspect that a state-owned North Korean bank used a Chinese front company to export “hundreds of millions of dollars” in coal and other minerals, receiving revenue in US dollars it could use to buy materials vital to the dictatorship’s weapons programme, according to the 44-page ruling.
The US has sought banking records from 2012 to 2017, suggesting that the scheme spanned at least five years.