- U.S. Treasury Targets Three North Koreans Associated With Crypto Attacks by the Lazarus Group
- Sanctions against three people have been announced by the Office of Foreign Assets Control of the U.S. Treasury because they are reportedly connected to North Korea’s infamous Lazarus Group.
The Department of Foreign Asset Control (OFAC) worked with South Korea to impose sanctions on three people who, according to the agency, gave North Korea-based Lazarus cyber organisation material support to exchange stolen bitcoin for fiat cash.
A banker with a base in China received additional sanctions for directing some of the illegal cash flow.
For “providing material support to the Lazarus Group,” the North Korean hacking collective responsible for some of the most significant cryptographic breaches, Wu Huihui was subject to OFAC sanctions.
Wu, headquartered in China, allegedly transferred millions of dollars’ worth of cryptocurrency into fiat money for North Korean “cyber actors” in various transactions in 2021, according to a statement issued by the Treasury Department on April 24.
They have allegedly assisted the Lazarus Group in converting stolen cryptocurrencies to fund the DPRK’s weapons programme, which includes the creation of WMDs. The Treasury also emphasised North Korea’s ongoing efforts to use digital assets to avoid sanctions and penetrate international financial systems in the press statement.
According to Brian E. Nelson, Under Secretary of the Treasury for Terrorism and Financial Intelligence, North Korea’s illegal efforts to “collect” revenue using virtual currency for the regime’s unlawful weapons of mass destruction(WMD) and ballistic missile programmes directly threatens international security.”
Although there are many restrictions on cryptocurrency operations in China, OTC transactions are still legal. According to the Treasury’s statement:
In order to avoid being discovered by financial institutions or the appropriate authorities, DPRK [Democratic People’s Republic of Korea] players frequently use networks of OTC traders, notably those situated in the People’s Republic of China (PRC), to undertake transactions on their behalf.
As per court documents, Sim Hyon Sop (Sim), 39, is accused of conspiring with over-the-counter (OTC) cryptocurrency traders to use stolen money to purchase goods for North Korea and of conspiring with North Korean IT workers to earn money by working illegally at blockchain development firms in the United States.
Sim is accused by OFAC of receiving bitcoin from North Korean nationals who engaged in illicit IT employment abroad. Sim is then alleged to have given orders to OTC traders like Wu and Cheng to transfer money to front firms, which then spent it on items like cigarettes and communication equipment, according to OFAC.
In January, The Federal Bureau of Investigation (FBI) also claimed that the Lazarus Group and APT38 were responsible for the $100 million Harmony Bridge Hack in June.