Man held in South Korea laundered US$1 billion for Iran through UAE, court papers show

Kenneth Zong allegedly created fake invoices to help Iran draw cash held by Seoul in lieu of payment for oil shipments

Federal prosecutors want to extradite the Alaskan resident to stand trial in the US

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An Alaska man accused of laundering US$1 billion held in South Korea for Iran funnelled nearly all the money through the UAE. Photo: Shutterstock

Published: 8:57pm, 4 Jun 2020Updated: 8:59pm, 4 Jun 2020

An Alaska man accused of laundering US$1 billion held in South Korea for Iran funnelled nearly all the money through the United Arab Emirates, US federal court documents released on Thursday show.

The court documents, filed as part of a US asset seizure effort, shed further light on how Kenneth Zong allegedly created fake invoices to help Iran draw cash held by South Korea in lieu of payment for oil shipments.

It also renewed questions about financial transparency in the UAE, as the order sought to seize US$20 million held by one of the country’s seven emirates.

Zong helped Iran by creating fake invoices for construction material, using them to convince South Korean banks and regulators to release the money, federal prosecutors said.

In April, the Industrial Bank of Korea agreed to pay US$86 million in fines over failing to stop the laundering, federal prosecutors in New York said.

Zong, earlier convicted of criminal charges in South Korea over the scheme, was due to be released from prison in March, though US federal prosecutors said it was likely he’d be held there until he paid a fine of millions of dollars.

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Why can't Iran and the US get along?