British tobacco company British American Tobacco (BAT) has been fined over $629 million (approximately 844.1 billion KRW) for violating U.S. sanctions against North Korea. This is the largest single fine ever imposed by the U.S. Department of Justice for sanctions violations related to North Korea.
Matthew Olsen, U.S. Deputy Assistant Attorney General for National Security, stated at a briefing on the 25th (local time) that "BAT continuously violated the law by conducting business in North Korea through third-party companies managed by its subsidiaries from 2007 to 2017." He added, "These third-party companies sold tobacco products in North Korea and received about $428 million (approximately 574.4 billion KRW), which flowed back to BAT."
According to the U.S. Department of the Treasury and the Federal Bureau of Investigation (FBI), who participated in the investigation, three individuals ? North Korean banker Sim Hyun-seop (39), Chinese accomplice Qin Guoming (60), and Han Linlin (41) ? purchased tobacco leaves from BAT and supplied them to North Korea. From 2009 to 2019, they bought tobacco leaves for a state-owned tobacco manufacturing company owned by the North Korean military and conducted at least 310 transactions by forging documents to deceive U.S. banks. It is reported that the tobacco manufacturing company owned by the North Korean military earned approximately $700 million (about 939.4 billion KRW) in profits through this scheme.
In a statement released on the same day, BAT said, "We have reached an agreement with the U.S. Department of Justice and the Office of Foreign Assets Control (OFAC) of the Treasury Department," adding, "The total amount to be paid to U.S. authorities is $635,241,338 plus interest."
Jack Bowles, CEO of BAT, expressed "deep regret for the illegal activities that occurred in past business operations" and acknowledged that "we fell short of the highest standards we expect."
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