Procurement: Russian Support for North Korean Scams


September 4, 2006: North Korea's primary source of funds, for its nuclear weapons and ballistic missile programs, are illegal operations that have been under attack by the United States. The drug and currency counterfeiting operations have been thwarted by shutting down North Korean access to foreign banks, which are needed to launder the cash generated. Exports of missiles and nuclear technology have been interrupted by surveillance of North Korean cargo ships, and boarding and searching those ships on the high seas.
North Korea is desperate to keep its weapons programs going, seeing nukes and missiles as the only way to keep their communist dictatorship safe from external attack, and a way to extort large sums of money and resources (fuel and food) from neighbors. Thus it should come as no surprise that North Korea has found ways to get around the Americans. For example, North Korea has been opening up bank accounts in Russia, apparently by bribing banking officials. The Russians deny everything, and it remains to see if the bribed officials will stay bought. Another gambit, using airfreight to move missile exports, may also be at risk. That's because Russian made transports are moving the missile components, and the U.S. can apply pressure to the companies that own the aircraft (and provide them to many Western clients as well). The North Koreans provide technicians to assemble the components at the other end. Iran is known to be one customer for North Korean ballistic missiles. It's long been known that North Korea also sells ballistic missile technology to countries like Syria, Pakistan and Iran.
Why would the Russians stick their necks out for North Korea? Mainly because Russia wants to expand its weapons exports. And one way to do that is to be the supplier of last resort. In effect, the Russians say, "you got the cash, we got the weapons, no problem." But now there's a problem, and it's not certain that the Russians will be able to fix it.
The North Koreans have also opened bank accounts in Vietnam, Thailand and Mongolia. But it won't take much pressure from the United States to get these nations to shut out the North Koreans. Russia, however, is another matter. Or is it?


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