Network security company "record the future" Recorded Future recently published a long report claiming that North Korea is using cryptocurrency to bypass US sanctions against it.
According to the report North Korea established a secret network of partners and facilitators in Singapore.
The report claims that in addition to cryptocurrencies such as Bitcoin and Monroe North Korean-led institutions are also involved in promoting cryptocurrency fraud which has defrauded millions of dollars around the world.
North Korea’s use of cutting-edge technology to circumvent the effects of economic sanctions on its regime is well documented. In September CCN reported that Washington-based financial experts Lourdes Miranda and Ross Delston accused North Korea of using cryptocurrency mining and coin scams to generate revenue. Earlier this month CCN also reported that a notorious North Korean hacker group called Lazarus was responsible for the $571 million cryptocurrency theft.
Recorded future reports that North Korea's mining of Bitcoin and Monroe is relatively small and their main efforts are focused on exploiting the growing cryptocurrency space to implement fraud. Since the first quarter of 2018 there have been two types of tokens that are considered to be the scam behind North Korea the HOLD coin and the marine chain Marine Chain.
Hold Coin formerly known as Interstellar HUZU and Stellar (not to be confused with XLM) used fraudulent betting plans to raise investors' funds went public on multiple exchanges and delisted and later disappeared.
Marine Chain is part of a more complex scam that points directly to the North Korean government's core ability to continually weaken the effectiveness of economic sanctions imposed by the United Nations. According to a survey conducted by Recorded Future on Marine Chain this is a pass-through framework based on sea-going ships. There are connected complex networks in Singapore that may have a profound impact on network security in Southeast Asia.
According to information collected by LinkedIn Marine Chain CEO Jonathan Foong and consultant HyoMong Choi are the main players in the chain fraud activities.
Captain Foong is reported to have complex links with a number of Singaporean companies that facilitate North Korea’s efforts to circumvent United Nations sanctions. The activities of these companies involved the manipulation of the flag registry of the three countries enabling the banned North Korean vessels to sail under convenient flags.
This means that Foong is more than just an ordinary cryptocurrant liar but is actually part of a key strategy for the North Korean regime to evade sanctions. Captain Foong emerged in the context of North Korean cryptocurrency fraud indicating that for the North Korean regime it hopes to actively exploit the possibilities of new technology waves including blockchains.