An Australian-Chinese man of Korean descent was recently extradited by the United States to the District of Columbia and is facing charges from the Department of Justice including conspiracy, bank fraud, and violations of sanctions against North Korea.
According to Department of Justice documents, 53-year-old Jin Guanghua was extradited to the United States on September 27. In 2022, he, along with North Korean conspirator, Korean banker Sim Hyon Sop, Chinese citizen Qin Guoming, and Korean Han Linlin, were indicted on related charges.
The U.S. Department of Justice alleges that between 2009 and 2019, the defendants were involved in a scheme to purchase tobacco for North Korean entities, using shell companies and falsified documents to facilitate at least 310 transactions totaling around $74 million through U.S. financial institutions. If these institutions had known these transactions were related to North Korean trade, they would have frozen, blocked, investigated, or refused them. It is estimated that these transactions benefited North Korean entities, ultimately bringing nearly $700 million in revenue to the North Korean government.
The indictment charges the defendants with conspiracy to commit bank fraud, violations and conspiracies to violate the International Emergency Economic Powers Act (IEEPA) and North Korean sanctions, money laundering, and conspiracy to launder money.
Australia, at the request of the United States, arrested Jin Guanghua on March 23, 2023, as he was preparing to leave Australia for China.
This case is part of the Department of Justice’s efforts to combat North Korea’s evasion of sanctions and illegal trafficking of tobacco products through the U.S. financial system.
As alleged in the indictment, the trafficking of tobacco products generates revenue for North Korea’s large-scale weapons of mass destruction (WMD) program. North Korea has been developing nuclear weapons since at least 2006 and has been funding these activities through illegal trade, including tobacco trafficking and counterfeit cigarettes, dating back to at least 1992.
North Korea’s production capacity for counterfeit cigarettes is estimated to exceed 2 billion packs per year. Counterfeit cigarettes are a major source of income for the North Korean regime and one of the most profitable items in North Korea’s product portfolio. It is estimated that for every $1 spent, smuggling tobacco can generate up to $20 in revenue. It is alleged that proceeds from North Korea’s tobacco sales flow back to the North Korean government, including funds used for maintaining loyalty among the party’s elite core and funding weapons development projects.
If convicted, the defendants could face up to 30 years in prison.