An Iranian bank designated Tuesday as a proliferator of weapons of mass destruction (WMD) has a financial relationship with North Korea that is of serious concern to the United States, the U.S. Treasury said.
Announcing a ban on all U.S. transactions with Bank Sepah, the fifth largest Iranian state-owned bank, Treasury Undersecretary Stuart Levey said the bank facilitated business between Iran's Aerospace Industries Organization (AIO) and Pyongyang's missile-related exporter, the Korean Mining and Industrial Development Corp. (KOMID).
"The financial relationship between Iran and North Korea, as represented by the business handled by Bank Sepah, is of great concern to the United States," Levey said at a press conference.
On separate bilateral sanctions talks with North Korea, expected within this month, Levey said no dates have yet been decided.
"I personally haven't heard anything directly or indirectly back in terms of setting up a follow-up meeting," he said.
Bank Sepah served as a financial conduit, facilitating Iran's international purchases related to its missile program, Levey said.
For example, it financed a purchase of missile-related items from China, he said.
In 2005, the AIO directed Sepah to transfer well over US$500,000 to a North Korean firm associated with KOMID, he said.
"The financial mediators that may be handling that business, that's something we are quite concerned about," said Levey.
Tuesday's designation was made under Executive Order 13382, which freezes assets in the U.S. of persons and institutions linked to WMD proliferation and prohibits American financial bodies from handling their transactions.
Under the order, issued in June 2005, the Treasury designated 23 entities and two individuals as WMD proliferators. Eight of them are traced to North Korea.
Levey went into details on North Korea-Iran missile technology exchanges. He said Iran's Shahab series of medium-range ballistic missiles, believed to be able to carry unconventional warheads at a range of at least 1,500 kilometers, are based on a North Korean design.
He said the Shahid Hemmat Industries Group (SHIG), responsible for Iran's missile program, "received help from China and North Korea in the development of this (Shahab) missile."
Last November, Iran's top military commander, Yahya Rahim Safavi, had publicly acknowledged that his country obtained missiles from North Korea during its war 1980-1988 war with Iraq.
"The truth is that during the war, we had Scud B and Scud C missiles," he said in a TV interview.
"We received these from foreign countries like North Korea," he said.
Both Pyongyang and Tehran, branded as an "axis of evil" by U.S. President George W. Bush, harbor nuclear ambitions and have been sanctioned by the U.N. Security Council for pursuing WMD development.
U.S. officials say each regime is watching closely how the international community deals with the other and have been attentive to ensure both face stringent countermeasures.
North Korea provided an example of how effective U.S.-led sanctions can be when the Treasury issued a warning in September 2005 against Macau's Banco Delta Asia (BDA), accusing the bank of laundering money Pyongyang obtains through illicit financial activities.
The North is suspected of making and circulating bogus American currency and trafficking narcotics and contraband.
The BDA case resulted in a freeze of $24 million of North Korea-related money and global rejection of transactions with Pyongyang.
"We have seen a kind of amplifying effect from the private sector in voluntarily pulling back the business they think might pose a risk of proliferation of terrorist financing," Levey said, without pinpointing the North Korea case.
Angered by the sanctions on the BDA, Pyongyang insists the U.S. must lift the punitive measures before it will agree to discuss denuclearization.
U.S. and North Korean financial officials met in Beijing last month at the sidelines of six-nation nuclear talks to address the sanctions.
The officials tentatively agreed to meet again in January, possibly on the week of Jan. 22.
Levey described the December meeting as "businesslike" in which the U.S. side laid out some of its concerns.
"But I cannot confirm exactly when another round of discussion might occur," he said.
Washington, Jan. 9 (Yonhap News)
U.S. raises concerns over North Korea-Iran financial links through WMD |
