Pyongyang Denied Woori Bank Account

It was confirmed on September 18 that North Korea asked to open a Woori Bank account in Gaesong Industrial Complex as an outlet for escaping U.S. financial sanctions imposed on the country.

At a meeting with related parties including the Ministry of Unification, the Ministry of Finance and Economy, the Ministry of Foreign Affairs and Trade, and the National Intelligence Service, the government discussed whether to accept North’s request, but failed to make a decision yet.

According to Grand National Party lawmaker Kwon Young-se and other sources, North Korean Central Special Zone Development Management called on Woori Bank’s Gaesong branch to open an account last December.

That was the time when the U.S. government strengthened sanctions on North Korea by freezing North’s account, after blaming Banco Delta Asia in Macao for its role in North Korean counterfeiting and money laundering.

At that time, Pyongyang’s Central Special Zone Development Management told Seoul’s Gaesong Industrial District Management Committee that it wanted to use a Woori Bank account for collecting income tax from South Korean workers in Gaesong Park and collecting wages for North Korean workers.

The bank refused the North’s demand, and Seoul sought advice from U.S. lawyers to find out whether the North’s opening an account is legally against Washington’s financial sanctions against Pyongyang.

As the account opening process was delayed, one North Korean National Security official reportedly threatened the South Korean Management Committee this February that the bank branch in Gaesong should be shut down if it doesn’t allow them to open an account.

To tackle this issue, the government held a meeting in March with Woori Bank and other relevant parties. It was affirmed, however, many disagreed to allow Pyongyang to open an account.

The National Intelligence Service said, “The U.S.’ nominal understanding should precede.” In the meantime, the Ministry of Foreign Affairs and Trade said, “it is not easy for us to discuss this issue with the U.S. North Korea can claim that Koreans cooperate with each other regardless of U.S. sanctions on the North.”

Officials at financial crime investigation team of the U.S. Treasury Department visited Korea on January 23 and expressed concerns about the North Korean regime having financial transactions with Woori Bank during a discussion on counterfeiting and money laundering.

The Korean government said that nothing has been decided on this issue as of September 18. “It is true that negative opinions outnumbered positive ones during the March meeting, but we haven’t decided yet what to do because of our relationship with North Korea,” a government official said.

gun43@donga.com srkim@donga.com