Part of the North Korean regime’s wealth could be in shell companies created in tax havens, according to a survey of South Korean journalists, who believe that they have discovered at least four British Virgin Islands shell companies connected to the North Korean regime.
Korea Center for Investigative Journalism (KCIJ) identified four companies suspected to have ties with the Pyongyang regime, all based in the British Virgin Islands, one of which is registered in North Korea, and three have names related to North Korea.
Although there is no official confirmation about the connection between these companies and the North Korean regime, KCIK investigation caused speculations according to which they could be used as tools for managing a fund of former North Korean leader Kim Jong-Il, suspected to have transferred his fortune abroad.
On the other hand, these companies could allow North Koreans to avoid international financial sanctions designed to prevent money laundering and commercial operations. However, following South Korean journalists’ investigation, it is not clear how and whether executives of those companies have used them to finance North Korean operations.
One of the companies, Larivader Solutions Inc., was created in the British Virgin Islands on November 19, 2004 and it was active at least until October 2009, according to the KCIJ site. One of the two directors of this company, Kwang Nam Mun was registered with the address “2 Kin Mal Dong, Mao Lang Bong, Pyong Yang District, Korean Republic,” added the nonprofit organization, citing the analysis of documents obtained from of a trust that provides assistance with the creation of companies in tax havens.
The Center also names three other shell companies in British Virgin Islands – Chollima Ltd., Chosun Ltd. and Koryo Telecom Ltd. – stating that they are not registered in North Korea, but they have “North Korean-style name.”
Two persons, Lim Jong Ju and Wong Yuk Kwan were recorded in documents as directors of the three companies, created in 2000-2001, according to the center. The two seem to be investors involved in the telecommunication business in North Korea, however it is unclear whether they have links with Orascom Telecom, an Egyptian company that operates the only 3G network in North Korea which has about two million North Koreans subscribers.