US Treasury Sanctions Individuals Connected to Lazarus Group

The US Treasury Department has imposed sanctions on three individuals who helped notorious hackers Lazarus Group manipulate the conversion of stolen cryptocurrency into fiat currency, allegedly financing the DPRK’s illegal weapons of mass destruction (WMD) and ballistic missiles. missile programmes.

An earlier report by Chainalysis alleged that the Lazarus Group was responsible for crypto theft worth about $1.7 billion in 2022.

3 over-the-counter traders in China are facing OFAC sanctions

The Treasury’s Office of Foreign Assets Control (OFAC) has designated sanctions against two over-the-counter (OTC) traders Wu Huehui, based in the People’s Republic of China, and Cheng Hong Man, based in Hong Kong.

OFAC also sanctioned Sim Hyun-sub, who recently moved to China and worked for Korea Kwangsun Banking Corporation, an entity previously designated to provide financial services support to two other institutions sanctioned for proliferation of weapons of mass destruction.

As stated in a press releaseIn 2021, Wu facilitated the transfer of stolen cryptocurrency worth millions of dollars into fiat for Lazarus Group, while Cheng Wu assisted by funneling payments to companies to receive cryptocurrency. PR reads:

“Often, DPRK actors use networks of over-the-counter merchants, including OTC dealers based in the People’s Republic of China (PRC), to conduct transactions on their behalf to avoid detection by financial institutions or relevant authorities.

On the other hand, Sim “coordinated millions of dollars in remittances to the DPRK,” with the Treasury Department, stating that the bank official received money from IT workers who fraudulently got jobs abroad.

Also, he directed Sim Wu and Cheng, along with other OTC traders, to transfer the stolen cryptocurrency to front companies who would in turn pay for goods, including tobacco and communication devices, on behalf of the DPRK.

After the OFAC sanctions, the properties belonging to Wu, Qing and Sim were blocked, and foreign individuals or institutions that conducted certain transactions with the designated persons could also be subject to sanctions.

A statement by Brian E. Nelson, Under Secretary of the Treasury for Terrorism and Financial Intelligence, said:

“The DPRK’s use of illegal facilitation networks to access the international financial system and generate revenue using virtual currency for the regime’s illegal weapons of mass destruction and ballistic missile programs directly threatens international security.”

The Lazarus Group controlled by the Nagorno-Karabakh Intelligence Bureau

Meanwhile, the OFAC announcement indicated that the Lazarus Group is under the control of the DPRK’s Reconnaissance General Bureau (RGB), the country’s main intelligence organization. The hacker group is known for several hacking incidents in the crypto industry.

The Lazarus Group was said to be the reason behind the largest ever cryptocurrency hack involving the Ronin Network, which saw a loss of $620 million. A report released by blockchain security group Chainalysis in February 2023 stated that the cybercriminal group stole around $1.7 billion in cryptocurrency in 2022.