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HomeEXTRABUSINESSChina's Jin Guanghua, Qin Guoming, Han Linlin, North Korean Banker Sim Hyon-Sop...

China’s Jin Guanghua, Qin Guoming, Han Linlin, North Korean Banker Sim Hyon-Sop Charged with Conspiracy, Bank Fraud, Violating DPRK Sanctions

On September 27, the Commonwealth of Australia extradited Jin Guanghua, 53, to the United States. Jin, a Chinese national, and his co-conspirators, North Korean banker Sim Hyon-Sop, 50, and Chinese nationals Qin Guoming, 60, and Han Linlin, 41, both of Liaoning Province, were all charged by indictment in 2022 in connection with a multi-year scheme to facilitate the sale of tobacco to North Korea through the U.S. financial system in violation of the sanctions imposed on North Korea. Jin made his initial appearance in the District of Columbia today.

Between 2009 and 2019, the defendants engaged in a scheme to purchase leaf tobacco for North Korean-owned entities and used front companies and false documentation to cause U.S. financial institutions to process at least 310 transactions worth approximately $74 million that the financial institutions otherwise would have frozen, blocked, investigated, or declined, had they known that the transactions involved trade with North Korea.

The transactions resulted in an estimated $700 million in revenue for North Korean entities and, ultimately, for the government of North Korea. The defendants are charged by indictment with conspiracy to commit bank fraud, conspiracy to violate and violations of International Emergency Economic Powers Act (IEEPA) and the North Korean sanctions regulations, and conspiracy to launder monetary instruments and laundering monetary instruments.

Jin was residing in Australia and was attempting to depart the country for China at the time of his arrest by Australian authorities on March 23, 2023. The arrest followed a request by the United States for Jin’s provisional arrest with a view toward extradition.

This case is part of a larger Justice Department response to the ongoing efforts of North Korea to evade sanctions and use the U.S. financial system to engage in illicit trafficking of tobacco products. As alleged in the indictment, trafficking in tobacco products generates revenue for advancing North Korea’s Weapons of Mass Destruction (WMD) programs.

North Korea has been developing nuclear weapons since at least 2006 and financed these activities through illicit trade, including trafficking of tobacco and counterfeit cigarettes, which North Korea has engaged in since at least 1992.

North Korea’s counterfeit cigarette production capacity is estimated to exceed two billion packs a year. Counterfeit cigarettes are a major source of income to the North Korean regime and may be the single most lucrative item in the North Korean portfolio, as smuggled tobacco is estimated to garner revenue as much as $20 on every $1 spent in cost.

North Korean tobacco sales are alleged to flow back to the North Korean government, including to slush funds designed to sustain the loyalty of a core of party elite and to underwrite weapons development programs.

If convicted, the defendant faces a maximum penalty of 30 years in prison for bank fraud, 20 years in prison for violating IEEPA, and 20 years in prison for committing money laundering. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.

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