SWIFT messaging system says bans North Korean banks blacklisted by UN

SWIFT messaging system says bans North Korean banks blacklisted by UN
The withdrawal of the authorisation came in response to the "current international" situation relating to North Korea and ongoing discussions in the UN Security Council, said the Society for Worldwide Interbank Financial Telecommunication (SWIFT).
PHOTO: Reuters

HONG KONG - Belgium-based SWIFT said on Wednesday it has stopped providing financial services to all North Korean banks under UN sanctions, as international tensions rise over Pyongyang's increasingly aggressive military behaviour.

The financial messaging system said it stopped providing services to the North Korean banks after Belgian authorities withdrew authorisation that had enabled SWIFT to serve the banks.

The withdrawal of the authorisation came in response to the "current international" situation relating to North Korea and ongoing discussions in the UN Security Council, said the Society for Worldwide Interbank Financial Telecommunication (SWIFT).

The UN Security Council on Tuesday condemned North Korea's recent ballistic missile launches and expressed concern over the country's increasingly destabilising behaviour and defiance of the 15-member body.

"As a result, SWIFT suspended access of UN-designated North Korean entities to the SWIFT financial messaging service,"it said. SWIFT did not say exactly when the services were suspended or how many banks were affected.

SWIFT's move follows a UN panel report last week that found evidence North Korea was relying on continued access to the international banking system to flout sanctions.

The Feb. 27 report by the UN Security Council's Panel of Experts said SWIFT had continued to provide financial messaging services to seven North Korean banks, three of them blacklisted.

The three blacklisted banks named by the UN panel as being in the SWIFT network were Bank of East Land, Korea Daesong Bank and Korea Kwangson Banking Corp. Bank of East Land was blacklisted in 2013, while the other two were blacklisted last year.

The banks could not immediately be reached for comment.

"At the time of writing, Democratic People's Republic of Korea circumvention techniques and inadequate compliance by Member States are combining to significantly negate the impact of the resolutions," the report said.

SWIFT told the UN panel that it received payment for services to North Korean banks with the authorisation of Belgium, the UN report said.

Belgium told the panel that under national and European law, the receipt of fees from a blacklisted bank can be authorised provided certain European Union provisions are complied with and the authorisations related to amounts of less than 15,000 euros.

On Wednesday, however, SWIFT said Belgium had recently stopped providing these authorisations.

The payment messaging system added that it had no authority to make sanction decisions.

"Any decision to lift or impose sanctions on countries or individual entities rests solely with the competent government bodies and legislators," it said.

Some cyber security companies have attributed several attacks on financial institutions via fraudulent SWIFT messages to a group called Lazarus, which has been linked to a cyber attack on Sony's Hollywood studio in 2014.

The US government publicly blamed the Sony hack on North Korea. North Korea has denied involvement.

More about

financial services
Purchase this article for republication.

BRANDINSIDER

SPONSORED

Most Read

Your daily good stuff - AsiaOne stories delivered straight to your inbox
By signing up, you agree to our Privacy policy and Terms and Conditions.