The Diplomat, which concentrates on Asia, carries an article which says that while the US administration and its allies in the region have relied on military deterrence and ratcheting up of sanctions, there is a missing component: a concerted international effort to roll back North Korea’s abuse of the global financial system to aid in the procurement of weapons of mass destruction, which those who study the issue call countering proliferation finance (CPF or CPF).   It says that while many states have engaged in transnational financial criminal behavior — money laundering and sanctions evasion — the threat emanating from North Korea is unique; the ability to exploit weak spots in the global financial regulatory and nuclear non-proliferation regimes is unparalleled.  CPF, the piece argues, requires additional layers of investigatory sophistication compared to other forms of economic national security tools. Matching account holders against lists of sanctions designations provided by governments, which banks can do in a straightforward way with screening software and existing know-your-customer (KYC) policies, is insufficient.  Banks need to be more proactive in recognising activity patterns that are the tell-tale signs of a proliferation network.  It says that CFP requires building on the foundation (of investment already made by intelligence agencies, law enforcement, financial regulators, and the private sector (especially banks) in related fields: AML, export control regimes, CFT, and preventing sanctions evasion) with a further level of investment and engagement.  A North Korea-focused CFP regime would necessitate banks obtaining granular information about their customers, reporting suspicious financial activity in a prompt way to relevant law enforcement or intelligence authorities, and integrating themselves into information-sharing mechanisms that ensure their access to the most up-to-date warnings about emerging threats.

Author: raytodd2017

Chartered Legal Executive and former senior manager with Isle of Man Customs and Excise, where I was (amongst other things) Sanctions Officer (for UN/EU sanctions), Export Licensing Officer and Manager of the Legal-Library & Collectorate Support Section

Leave a Reply

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s

%d bloggers like this: