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U.S. puts sanctions on Iran-based company linked to N. Korea

  • Story Highlights
  • Hong Kong Electronics called a cover for North Korea's missile proliferation network
  • U.S. Treasury says company's U.S. assets frozen, transactions in U.S. prohibited
  • It says company worked with bank, arms dealer tied to other sanctioned entities
  • Goal is to stop misuse of financial system to advance arms programs, Treasury says
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WASHINGTON (CNN) -- The United States on Tuesday imposed financial sanctions on an Iran-based company that it said is a cover for North Korea's missile proliferation network, the Department of the Treasury announced.

Hong Kong Electronics in Kish Island, Iran, was added to the list of "designated proliferators of weapons of mass destruction and their supporters" for working with two others already on the list: North Korea's Tanchon Commercial Bank and the Korea Mining Development Trading Corp. (KOMID), according to a Treasury news release.

The designation under Executive Order 13382 freezes any U.S. assets of Hong Kong Electronics and prohibits any transactions with the company by U.S. individuals, companies or financial institutions, the statement said.

"North Korea uses front companies like Hong Kong Electronics and a range of other deceptive practices to obscure the true nature of its financial dealings, making it nearly impossible for responsible banks and governments to distinguish legitimate from illegitimate North Korean transactions," said Stuart Levey, the undersecretary for terrorism and financial intelligence at the Treasury. "Today's action is a part of our overall effort to prevent North Korea from misusing the international financial system to advance its nuclear and missile programs and to sell dangerous technology around the world."

The Treasury statement alleged that Hong Kong Electronics has transferred millions of dollars of proliferation-related funds on behalf of Tanchon and KOMID since 2007. It also accused Hong Kong Electronics of facilitating the movement of money from Iran to North Korea on behalf of KOMID.

Tanchon, a commercial bank based in Pyongyang, North Korea, is the financial arm for KOMID, which the Treasury statement described as North Korea's premier arms dealer and main exporter of goods and equipment related to ballistic missiles and conventional weapons.

Both Tanchon and KOMID were previously subjected to sanctions under Executive Order 13382 and sanctioned by the U.N. Security Council, according to the Treasury statement.

It said both also had ties with other sanctioned entities, including Iran's Shahid Hemmat Industrial Group, which it called the Iranian organization responsible for developing liquid-fueled missiles.

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