[The U.N. report says the bank, called
International Consortium Bank, was established as a joint venture between MKP
and Jang's Sungri Economic Group. The bank is licensed by North Korea's central
bank and registered with the Pyongyang Municipal People's Committee, it said.]
By James Pearson, Tom Allard
and Rozanna Latiff
 |
|
A
general view of the Malaysia-Korea Partners (MKP) Holdings headquarters
in
Kuala Lumpur, Malaysia March 22, 2017. REUTERS/James Pearson
|
Over the past two decades, North Korean-born
Han Hun Il, the founding chief executive of a Malaysian conglomerate, funneled
money to the leadership in Pyongyang, a North Korean defector, speaking out for
the first time, told Reuters.
Han’s conglomerate, Malaysia Korea Partners
(MKP), worked in partnership with Jang Song Thaek, according to Lee Chol Ho,
who worked as a trader for Han for nine years until he defected to Seoul in
2010. Jang, the uncle of North Korea's ruler Kim Jong Un, was considered one of
North Korea's most powerful men until he was executed for treason in 2013.
Reuters was unable to independently confirm
Lee's account of Han's relationship with North Korea's leadership, including
his assertion that money was funneled to North Korea's leadership body, the
central committee of the ruling Workers' Party.
Reuters also couldn't determine how the
central committee, which controls North Korea's highly sanctioned nuclear and
weapons program, used the funds from Han or if the payments are continuing.
The new disclosures come at a time when
United Nations sanctions monitors are intensifying scrutiny of both Han and
MKP.
A February report by experts monitoring U.N.
sanctions on North Korea says MKP's bank subsidiary in Pyongyang is a
particular focus. A 2013 U.N. resolution bars foreign companies or foreign
joint ventures with a North Korean company from having a financial subsidiary
in North Korea.
The U.N. report says the bank, called
International Consortium Bank, was established as a joint venture between MKP
and Jang's Sungri Economic Group. The bank is licensed by North Korea's central
bank and registered with the Pyongyang Municipal People's Committee, it said.
If the U.N. experts find sanctions have been
violated, they could recommend the U.N. Security Council blacklist MKP, its
executives or one or more of its subsidiaries, subjecting them to a global
travel ban and asset freeze.
STRAINED
TIES
Han, also known as Dr. Edward Hahn, hung up
the phone and blocked a Reuters reporter on his messaging app when contacted
for comment.
MKP did not respond to requests for comment
on Lee’s assertions. The company issued a statement dated March 23 saying MKP
had “no reason to hide the fact” that Han is North Korean. It denied owning ICB
or any other North Korean bank and said nobody from the United Nations has
contacted the company.
The U.N. said it does not comment on its
ongoing investigations.
Lee's description of how MKP operated appears
to shed fresh light on the close ties between Malaysia and North Korea, which
have come under strain following the assassination of Kim Jong Nam, the elder
half-brother of North Korea’s ruler, with the highly toxic VX nerve agent in
February.
Reuters reported in February that North
Korea’s spy agency was running an arms export operation out of Malaysia.
Malaysia's foreign ministry did not respond
to Reuters’ requests for comment.
PYONGYANG
BANK
MKP, which Han formed in 1996 with his
Malaysian partner, Yong Kok Yeap, operates in 20 countries in Asia, Africa and
the Middle East, piling up contracts worth at least $350 million, an MKP
corporate video and promotional brochures shows.
Yong declined requests to be interviewed.
MKP's main business is construction, but it
is also involved in a number of other activities, including financial services
and coal trading, according to U.N. reports, company sources, registration
documents and MKP promotional material.
ICB is among several banks the U.N. is
currently investigating for possible breaches of various U.N. Security Council
resolutions. These include one from 2013 calling on members states to prohibit
financial service companies where there are “reasonable grounds to believe that
such financial services could contribute to [North Korea’s] nuclear or
ballistic weapons programs.”
In its March 23 statement, MKP said its
website had been “hacked” to insert ICB under its list of service companies and
place a “doctored photograph” of “MKP personnel”, including Yong, visiting
ICB’s office in Pyongyang.
A search of archive.org, a database of old
websites, shows ICB has been listed on MKP’s website since 2009, including
under its earlier name, Sungri Hi-Fund International Bank. As of April 10, ICB
was still listed on the website.
In its February report, the U.N. said it had
inquired with Malaysia and MKP about ICB and had “yet to receive a reply.”
'CONTROL
TOWER'
Lee said Han had used MKP as the “control
tower” of a vast business empire, making him one of the isolated country’s
richest men. He said Han began his career in Africa with North Korea's
Reconnaissance Bureau, its premier spy agency.
“When people from the Central Committee
visited Malaysia, they only met with Han,” Lee said. “They didn’t even bother
to see the ambassador.”
The Central Committee directs the development
and financing of North Korea’s nuclear and missile programs, said Michael
Madden, a North Korea expert at Johns Hopkins University’s 38 North website.
Once a year, Lee said, high-ranking Pyongyang
officials traveled to Kuala Lumpur to meet Han and instruct him to wire money
to North Korea via banks in Malaysia.
“It was all dollars and euros,” said Lee.
Lee said Han was part of Jang's overseas
network of businessmen.
Two current company sources said MKP’s
fortunes - with the exception of its African businesses - declined after 2013
and Han became an infrequent visitor to Malaysia. They said they didn't know
whether the downturn was related to Jang’s demise.
(Additional reporting by Heekyong Yang in
Seoul and Michelle Nichols at the United Nations; Editing by Bill Tarrant)
