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Maiko Takeuchi, the board chair and chief executive officer of Compliance and Capacity Skills International Asia Pacific, delivered a speech during a session focused on North Korean sanctions at the 18th Jeju Forum for Peace and Prosperity in Jeju Island, South Korea, on June 1. (Photo by Darryl Coote/UPI)
JEJU ISLAND, South Korea, June 21 (UPI) – According to a former U.N. expert on Pyongyang, the United Nations Security Council should implement new sanctions targeting North Korea’s cybercrime activities. However, significant obstacles exist due to Russia’s war in Ukraine and growing tensions between the United States and China.
“The biggest concern is the absence of new sanctions and designations,” said Maiko Takeuchi, who served as a defense policy official with Japan’s Ministry of Defense and as a U.N. Security Council member of the Panel of Experts for North Korea from 2016 to 2021, during a recent conference.
Between 2006 and late 2017, nine U.N. resolutions were passed to impose sanctions on North Korea in order to coax the Kim Jong Un regime into denuclearization. However, no new measures have been enacted since then.
In May 2022, as North Korea conducted a series of missile tests, the U.N. Security Council failed to enact punitive measures against Pyongyang for the first time. This was due to China and Russia, who hold veto power, siding against the U.S.-led resolution.
In February, a U.S.-led call for the Security Council to take action on North Korea also failed due to opposition from China and Russia.
According to Takeuchi, both China and Russia previously had incentives to support sanctions on North Korea. However, now they do not want to side with the United States due to their deepening conflicts with Beijing and Moscow. Russia is believed to be receiving munitions from Pyongyang amid its war in Ukraine, while China, North Korea’s most important ally and largest trading partner, is unlikely to support the United States without concessions.
“The North Korean issue can be one of the tools or items to be used as a deal. Even if they have room to agree on the North Korean issue, they don’t want to,” Takeuchi explained.
Amid Russia’s war in Ukraine, Pyongyang is actively trying to increase its importance to Russia in order to gain support from President Vladimir Putin, who is seeking to secure any support possible.
Regarding China, even though it is not arming Russia in the conflict, it is strengthening its relationship with Moscow.
“But still, before supporting the U.S. or supporting Russia, which one do you take?” Takeuchi questioned.
While some argue that the existing sanctions need better enforcement, Takeuchi agrees that full enforcement would have a significant impact on North Korea. However, the current measures do not specifically target Pyongyang’s malicious cyber activities, which have become a major source of funding for the regime’s nuclear and weapons programs.
According to a February report from Chainalysis, a New York City-based blockchain analysis firm, North Korean hackers stole $3.8 billion from cryptocurrency businesses in 2022. This represents a slight increase from $3.3 billion the previous year and a massive jump from $500 million in 2020. In comparison, South Korea’s gross domestic product for 2021 was $28 billion.
Joseph Byrne, a research fellow at the London-based think tank Royal United Services Institute, explained during a panel on North Korea sanctions at the Jeju Forum that North Korea collaborates with criminal organizations to evade sanctions. These networks help Pyongyang generate new revenue sources, including through money laundering cryptocurrencies.
Byrne referenced recent U.S. Department of Justice indictments that accuse North Koreans of using over-the-counter cryptocurrency traders to launder stolen funds and purchase goods that are then sent to North Korea.
“The money is generated outside of North Korea, it is spent outside of North Korea, and the goods are procured outside of North Korea,” Byrne stated.
“Lots of this activity has not been sanctioned and has not been designated at the U.N. level,” he added.
Takeuchi explained that North Korea’s cyber activities only violate sanctions if they infringe upon existing designations. Due to the anonymity provided by the Internet, it is challenging to prove such violations.
“If they use cyber activities to steal weapons of mass destruction technology from England, that would be a violation of sanctions due to the purpose. However, if they just steal money from my digital wallet, it’s a matter for the NYPD. That’s the difference,” she said.
The exact number of people targeted by North Korean cyber intrusions is unknown, but Takeuchi believes it is significant. She pointed to the 2017 WannaCry global ransomware attack, which affected hundreds of thousands of computers in 150 countries, as evidence of the scale of their operations.
“It is only the tip of the iceberg,” Takeuchi remarked.
North Korean hackers not only attempt to infiltrate people’s wallets but also target their personal information. They aim to gain access to accounts connected to their intended targets, from whom they intend to steal information or blackmail.
Unsuspecting companies, such as bakeries, are also targeted because their clients may include individuals who work for the companies the hackers are seeking to infiltrate.
Takeuchi expressed concern that North Korean hackers may be stealing personal information to pose as their victims online. With remote work becoming more prevalent due to the COVID-19 pandemic, these hackers could use the stolen information to obtain freelance employment anywhere in the world without the victims’ knowledge.
Although speculative, Takeuchi believes this aligns with North Korea’s modus operandi.
Japan has identified 17 of its citizens who were abducted by North Korea in the 1970s and 1980s, with another 873 suspected cases of missing persons being taken by Pyongyang.
One confirmed case is that of Tadaaki Hara, a 43-year-old noodle shop employee from Osaka. Hara was abducted in June 1980, and North Korean agent Shin Kwang Soo assumed his identity. While impersonating Hara, Shin obtained a Japanese passport, which he used to travel abroad and establish North Korean bases targeting South Korea.
According to Japan, North Korea has since admitted to abducting Hara, claiming that he died of cirrhosis.
Takeuchi postulated that hackers could conduct similar virtual abductions, with the victims being unaware of the impersonation.
“I could easily imagine they could do the same thing with cyber, and it is easier,” she said.
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