Treasury further blocks N. Korea from U.S. financial system

The United States on Wednesday declared North Korea a "primary money laundering concern" and took steps to further block the isolated country from access to the U.S. financial systems.

The U.S. Treasury department in a statement called for new measures to "further isolate North Korea from the international financial system" by barring covered U.S. financial institutions from opening or maintaining correspondent accounts with North Korean financial institutions or processing transactions for them.

The department said the action is aimed not only at North Korea as a "primary money laundering concern" but also its use of state-controlled financial institutions in programs for weapons of mass destruction and ballistic missiles as well as its reliance "on the illicit and corrupt activity of high-level officials to support its government."

"The regime is notoriously deceitful in its financial transactions in order to continue its illicit weapons programs and other destabilizing activities,” said Adam J. Szubin, acting under secretary for terrorism and financial intelligence. “Today’s action is a further step toward severing banking relationships with North Korea, and we expect all governments and financial authorities to do likewise pursuant to the new U.N. Security Council Resolution. It is essential that we all take action to prevent the regime from abusing financial institutions around the world — through their own accounts or other means.”

The designation of North Korea as a major money-laundering operation stems from the North Korea Sanctions and Policy Enhancement Act passed by Congress in February.

In March, the United Nations increased sanctions pressure on Pyongyang in response to its most recent nuclear test in January.