The US Department of the Treasury’s Office of Foreign Assets Control (OFAC) announced new sanctions today targeting a North Korean money laundering network operating through digital assets. 

The network, based in the United Arab Emirates (UAE), facilitated the illicit transfer of millions of dollars generated by North Korean IT workers and cybercrime activities to support the regime in Pyongyang.

The sanctions focus on two individuals, Lu Huaying and Zhang Jian, and a UAE-based entity, Green Alpine Trading, LLC. These actors are accused of laundering funds for OFAC-sanctioned North Korean operative Sim Hyon Sop, a banking representative orchestrating money laundering schemes for the Democratic People’s Republic of Korea (DPRK). These schemes are believed to directly fund the DPRK’s unlawful weapons of mass destruction (WMD) and ballistic missile programs.

The Treasury emphasized the collaborative nature of today’s sanctions, highlighting the UAE’s involvement in disrupting the DPRK’s financial operations. “As the DPRK continues to use complex criminal schemes to fund its WMD and ballistic missile programs—including through the exploitation of digital assets—Treasury remains focused on disrupting the networks that facilitate this flow of funds to the regime,” said Acting Under Secretary of the Treasury for Terrorism and Financial Intelligence, Bradley T. Smith.

Lu Huaying, a UAE-based Chinese national, is accused of cashing out cryptocurrency from North Korea’s obfuscated revenue-generating projects into fiat currency. Zhang Jian, another UAE-based Chinese national, reportedly facilitated fiat currency exchanges and served as a courier for Sim. 

Both individuals operated through Green Alpine Trading, LLC, which served as a front company to conceal the illicit transactions and facilitate funds flow back to Pyongyang. Sim Hyon Sop, a designated North Korean financial agent based in China, has been instrumental in managing schemes that fund the DPRK’s military ambitions.