The United Nations Security Council bans joint international ventures with North Korea, and the Trump Administration has issued an executive order promising economic penalties for those who engage in business with the country. But CNN’s Joshua Berlinger reports that several businesses in Hong Kong seemingly have been set up as front companies that help North Korea access global financial systems and cover up much of its trade, including selling energy resources and exporting weapons. Berlinger reports that the U.N., along with United States law enforcement agencies and nongovernmental analysts, have identified Hong Kong in particular as a jurisdiction where many of these North Korea-controlled front companies are operating.
Pillsbury International Trade partner Christopher Wall tells CNN that the front companies likely violate the U.N. sanctions and that time will tell how the U.S. chooses to enforce economic restrictions on countries and companies that do business with North Korea.
“There is going to have to be some action taken … to show that we really mean what we say in terms of cutting off business with North Korea,” he said. “If we don’t do that, then this will just be a paper tiger. It won’t really be effective.”