The U.S. Department of State on Tuesday pledged to block North Korea’s access to banking infrastructure at the international level a day after affiliates of the Chinese HongXiang group were charged with illicit nuclear-related trades with North Korea.
Assistant Secretary of State Daniel Russel said the U.S. government would shut down any banking activities linked to North Korean Weapons of Mass Destruction (WMD) Programs, at a hearing of Subcommittee on Asia and the Pacific at the House Committee on Foreign Affairs held in Washington, D.C.
Russel said he agreed with Subcommittee Chairman Matt Salmon that the U.S. should impose financial sanctions on the North by cutting off specialized financial messaging services provided by the Belgium-based SWIFT (Society for Worldwide Interbank Financial Telecommunication) system.
SWIFT – used by more than 11,000 financial institutions in more than 200 countries – abided by the EU Regulation 267/2012 which prohibits providing financial services to EU-sanctioned Iranian banks until sanctions against the country were lifted early this year.
“The SWIFT system which is what I think you are referring to is not a U.S. system, and therefore not under our direct control. I believe it’s an EU system up housed in Brussels,” Daniel Russel, the Assistant Secretary of State for East Asian and Pacific Affairs at the U.S Department of State said, when asked by how the U.S. administration planned to further penalize North Korea.
The necessity of far-reaching financial sanctions rose to the surface after the North was suspected to be connected to Bangladesh Bank heist back in May.
“We are in discussions with our partners, including the EU, about tightening the application of sanctions and pressure, including and particularly to deny North Korea access to the international banking infrastructure that it has abused and manipulated in furtherance of its illicit programs,” Russel said.
“I think that our hope is that we will in fact ultimately be able to reach an agreement that would further restrict North Korea’s access.”
Russel underscored that the U.S. would step up its surveillance to close loopholes with South Korean and Japanese counterparts, with a key focus on cutting off sources of bulk cash generated through the coal trade and overseas by North Korean workers.
U.S. Republican Representative Sean Duffy’s amendment (H.Amdt.1432), which included the DRPK in the Prohibiting Future Ransom Payments to Iran Act (H.R.5931), was passed in the House of Representatives on September 22. As of September 28, the bill is yet to pass the Senate.
“An amendment numbered 4 printed in House Report 114-781 to prohibit cash and precious metal payments [such as gold] to designated state sponsors of terrorism and North Korea in addition to Iran,” the official website of the U.S. Congress states.
Salmon also attacked China, blaming the country’s lack of resolve to implement sanctions and arguing that the U.S. should figure out newer and more improved ways to limit the China’s abilities and reinforce pressure on the DPRK.
“Most people realize that China poses a lot more leverage over North Korea than anybody else combined,” Salmon said during the hearing.
The Chinese Ministry of Foreign Affairs on Tuesday voiced opposition to U.S. unilateral measures issuing charges against China’s Dandong HongXiang Industrial Development Co. Ltd. (DHID) and four senior managers.
The targets were alleged to involve in the development of centrifuges for uranium enrichment by supplying Pyongyang with aluminum ingots, ammonium paratungstate, aluminum oxide and tungsten trioxide.
“If any country tries to exercise ‘long-arm jurisdiction’ by enforcing its domestic laws over China’s enterprises and individuals, we are firmly opposed to that,” Geng Shuang, Chinses Foreign Ministry spokesperson told reporters during a regular briefing.
Featured Image: U.S. Department of State, Published on September 8, 2015
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