U.S. Moves to Seize Tanker Used in Illicit North Korean Trade
The U.S. Government moved to seize an oil tanker that they allege in a court filing was used to violate U.S. and U.N. sanctions against North Korea. The civil forfeiture complaint was part of a criminal complaint filed in Manhattan federal court against a Singapore national charged with conspiring to evade economic sanctions on North Korea and money laundering.
The complaint charges that a 3,900 dwt tanker registered in Cameroon, M/T Courageous, illicitly stopped transmitting location information over a four-month period between August and December 2019. During that time, U.S. surveillance satellite imagery shows that M/T Courageous engaged in a ship-to-ship transfer of more than $1.5 million worth of oil to a North Korean ship. The North Korean vessel, the Saebyol, had been designated by the Department of the Treasury, Office of Foreign Assets Control (OFAC), and traveled to the North Korean port of Nampo.
The Courageous was taken into custody in Cambodia in 2020. It was reported at the time that the vessel had sailed from Taiwan in February 2020 arriving in Cambodian waters at the end of the month. The vessel was detained and the 16 crew on board were later charged by the Cambodian authorities with violating sanctions against North Korea.
Among the other attempts that had been made to disguise the identity of the vessel, media reports said it was seen flying the Cambodian when it anchored in their waters leading to confusion over its registry. It also appeared to have been operating under the name Sea Prima registered in St Kitts and Nevis. The vessel currently remains in Cambodia.
“The seizure of the Courageous is another step in sinking North Korea’s efforts to circumvent sanctions on the high seas,” said Assistant Attorney General John C. Demers. “The United States will continue to enforce sanctions on North Korea through civil forfeiture actions and criminal prosecutions to ensure that the North Korean government – and the private entities that enable this regime by prioritizing personal profit over global security – are held accountable.”
The criminal complaint charges Kwek Kee Seng, age 61 and a citizen of Singapore, with conspiring to violate the International Emergency Economic Powers Act and to commit money laundering. It is alleged that Kwek and his co-conspirators took steps to hide their scheme by operating a series of shell companies, lying to international shipping authorities about Courageous’ dealings with North Korea, and falsely identifying Courageous as another ship to evade detection.
The complaint says that Kwek and his co-conspirators arranged for a variety of payments, denominated in U.S. dollars, that were processed through U.S.-based correspondent accounts to purchase oil – including more than $1.5 million to purchase the oil that was transferred to the Saebyol, over $500,000 to buy M/T Courageous, and thousands of more dollars to procure necessary services for M/T Courageous and another vessel, including registration fees, ship materials and salary payments for crewmembers. Kwek and his co-conspirators sought to conceal these sanctions-evading transactions by, among other things, using front companies to disguise the nature of the transactions, disguising location information for vessels carrying illicit shipments, and conducting ship-to-ship fuel transfers on the open sea.
Kwek Kee Seng remains at large. Each count carries a maximum term of 20 years in prison.
“As alleged, Kwek Kee Seng conspired to violate international sanctions by arranging illicit deliveries of petroleum products to North Korea, and used front companies and false documentation to send money through the U.S. financial system in furtherance of his support for that pariah state,” said Manhattan U.S. Attorney Audrey Strauss. “As a result of his illegal activities, not only does Kwek face criminal charges, but his sanctions-evading ship, the Courageous, has been seized and will no longer enable North Korea’s pattern of evading the global community’s prohibitions on support for that regime.”
FBI Assistant Director William F. Sweeney Jr. pointed out that this is not the first time the U.S. has moved to seize a vessel involved in this illegal trade. In May 2019, the U.S. seized M/V Wise Honest, a 17,600 ton bulk carrier. At the time the U.S. said it was one of North Korea’s largest vessels used to carry coal. The vessel was later sold with the proceeds used to compensate the parents of Otto Warmbier, an American student the U.S. accused North Korea of torturing after her tried to steal a propaganda poster, and the relatives of the Reverend Dong Shik Kim, who it was charged the North Koreans kidnapped, tortured and executed in 2000.