U.S. authorities have announced the seizure of a North Korean carrier shipM/V Wise Honest (the “Wise Honest”), a 17,061-ton, single-hull bulk carrier ship registered in the Democratic People’s Republic of Korea (“DPRK” or “North Korea”).  The Wise Honest, one of North Korea’s largest bulk carriers, was used to illicitly ship coal from North Korea and to deliver heavy machinery to the DPRK.  Payments for maintenance, equipment, and improvements of the Wise Honest were made in U.S. dollars through unwitting U.S. banks.  This conduct violates longstanding U.S. law and United Nations Security Council resolutions. From at least November 2016 through April 2018, the Wise Honest was used by Korea Songi Shipping Company, an affiliate of Korea Songi General Trading Corporation (a.k.a. “Songi Trading Company”), to export coal from North Korea to foreign purchasers and import machinery to North Korea (the “Korea Songi Scheme”).  On June 1, 2017, OFAC designated Songi Trading Company pursuant to Executive Order 13722 for its involvement in the sale, supply, or transfer of coal from North Korea.  OFAC also determined that Songi Trading Company was a subordinate of the Korean People’s Army.

On or about March 14, 2018, the Wise Honest was loaded with coal in Nampo, North Korea.  On or about April 2, 2018, foreign maritime authorities intercepted and detained the Wise Honest.  Maritime regulations require vessels like the Wise Honest engaged in international voyages to operate an automatic identification system (“AIS”) capable of providing information about the vessel to other ships and coastal authorities.  However, despite its March 2018 voyage from North Korea, the Wise Honest had not broadcast an AIS signal since August 4, 2017.

Participants in the Korea Songi Scheme attempted to conceal the Wise Honest’s DPRK affiliation by falsely listing different countries for the Wise Honest’s nationality and the origin of the illicit coal in shipping documentation.