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Seized vessel tied to China firm

Ships used to import oil to North Korea traced to addresses
Jan 05,2018
A Panama-flagged vessel suspected of illicitly transferring oil products to North Korea and seized by South Korean authorities last week was operated by a Chinese company with links to a blacklisted North Korean shipping company.

According to a document filed with the Port State Control Committee of the Asia-Pacific region confirmed by the JoongAng Ilbo on Wednesday, the KOTI is Panama-flagged but its actual operator was a Chinese company, Dalian Grand Ocean Ship Management, which lists as its address Wu Wu Lu 32, Zhong Shan Qu, Dalian in northeastern China’s Liaoning Province.

It shares that address with North Korea’s Ocean Maritime Management Company (OMM), a leading North Korean shipping company sanctioned by the United Nations Security Council and the U.S. Treasury since 2014 for concealing arms shipments and other illicit goods including components for surface-to-air missile systems and MiG-21 jet fighter parts and engines.

The U.S. Treasury’s Office of Foreign Assets Control cites one of the Pyongyang-headquartered OMM’s addresses as “Wu Wu Lu 32-1, Zhong Shan Qu, Dalian City, Liaoning Province,” virtually identical to that of Dalian Grand Ocean Ship Management.

OMM and vessels linked to it have been sanctioned by the UN Security Council and are banned from entering ports of member states.

To evade those sanctions, OMM has switched up the operators of its ships and changed the names of the vessels.

The KOTI was seized at Pyeongtaek-Dangjin port on Dec. 21, South Korean customs officials disclosed Saturday, the second ship seized by authorities over suspected oil shipments to North Korea in violation of UN sanctions. South Korea also recently seized the Lighthouse Winmore, a Hong Kong-flagged vessel chartered by a Taiwanese company.

The address in Dalian is for a building with multiple offices, which could mean that it is by coincidence that the two companies share the address.

However, in the International Maritime Organization (IMO) and the Equasis databases, Harmonized Resources Shipping Management is cited as the KOTI’s manager.

NK News reported in May that Harmonized Resources Shipping Management is located in the Success Building’s room 1802 at 72 Luxun Lu, in Dalian, citing the Sierra Leone Maritime Administration.

The article said Sierra Leone’s official shipping registry employs several Chinese nationals involved in North Korea weapons smuggling networks. It described two individuals, Dong Changqing and Lu Tiehe, as Dalian-based business partners known to the UN Security Council for their companies’ repeated involvement in North Korean weapons proliferation.

A third individual, Fan Mintian, a business partner of Dong, is also mentioned as an individual involved in illicit North Korea shipments sharing an office in central Dalian.

The 72 Luxun Lu address is described as also being the registered address for two other companies that are involved in North Korea’s smuggling network, both identified by a Security Council panel of experts. North Korea’s OMM and another two companies involved in illicit shipping networks have operated from offices next door at 32 Wu Wu Lu, Dalian, reported NK News.

According to the UNSC panel of experts, there are at least five North Korea-related shipping companies with addresses registered at those two locations.

Dong and Lu operated Sea Star Ship Company, which operated the North Korean MV Light vessel that was suspected of smuggling missile parts in 2011 to Myanmar and intercepted by the U.S. Navy in May that year. Fan was also in charge of the Jie Shun, which was seized by Egyptian authorities in the Suez Canal in August 2016 for smuggling 30,000 PG-7 rocket-propelled grenades.

“In order to evade maritime sanctions, North Korea frequently uses shell companies and changes the ownership structure of its vessels in a complicated way,” a diplomatic source knowledgeable about such security affairs said. “Since there are so few people who can be trusted, this problematic trio repeatedly show up.”

BY YOO JEE-HYE, SARAH KIM [kim.sarah@joongang.co.kr]