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Binance Facilitates US OFAC Seize $4.4M Crypto Linked to North Korea Cybercrime Entities

Binance has, in its Thursday, May 25 tweet, confirmed facilitating the US authorities to identify and seize crypto assets valued at $4.4 million. The flagged holdings were identified in the lawfully served warrants as linked to the cybercrime syndicates from North Korea.

Binance Investigation Unit Acts on OFAC Input to Seize Illicit Revenue

Binance conveyed the news of the successful seizure in its official Twitter hurdle that its internal investigations team collaborated with US law enforcement to thwart the illicit revenue. Its Twitter threat lauds the coordinated purge successfully to hamper the illicit financing process connected with four sanctioned North Korean entities.

The firm’s tweet details the action undertaken as a proactive intervention to the proceeds held in the accounts since their flagging a year ago. An inquiry into whether Binance has ongoing collaborative efforts prompted the spokesperson to respond in the affirmative. 

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The leading crypto exchange in transaction volume harbors continuous monitoring of its platform to smoke out the actors sponsored by the nefarious state to further illicit revenue generation. Such eventualities mandate collaborating with law enforcement. 

The revelation of Binance’s facilitative efforts comes 48 hours following the May 23 statement where the Office of Foreign Assets Control (OFAC) within the Department of Treasury confirmed sanctioning an individual and four entities for cybercrime. The agency imposed the sanctions citing the involvement in malicious cyber activities considered to finance the government of the Democratic People’s Republic of Korea (DPRK).

OFAC Unmasks North Korea’s Hacking Network Led by Chinyong

OFAC identified the sanctioned entities as led by Chinyong Information Technology Cooperation Company (CITCC), operating with a network of interlinked staff of highly trained IT experts globally. Besides the Technical Reconnaissance Bureau (TRB), DPRK relies on the Pyongyang University of Automation, which works alongside the 110th Research Center.

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OFAC identifies Chinyong as a well-coordinated unit leveraging the advanced skills of IT experts tasked with sourcing revenue to finance DPRK’s unlawful WMD manufacture and executing the ballistic missile programs. 

OFAC cited past investigations revealing that Chinyong workers often use stolen or falsified identities when applying for overseas IT-related gigs. Majority land in tech and crypto workplaces where they masquerade to launder payments destined for the DPRK through crypto exchanges.

OFAC Identifies Kim Man as the Centerpiece of Lazarus Group Hacking

OFAC identified a key figure in the cybercrime syndicate as Kim Sang Man. The law enforcement agency presumed Kim’s involvement in facilitating salaries paid to the relatives of the DPRK staff delegation. OFAC alleges that Kim has, in return, earned $2 million of cryptos as compensation for availing IT equipment to the DPRK-affiliated units located in Russia and China

The Treasury Department indicates that the DPRK tasks the Technical Reconnaissance Bureau as the developer of offensive cyber tactics. Also, the TRB supplies the equipment cyber criminals rely on, including Lazarus Group affiliates. 

The Treasury’s OFAC has previously linked the Lazarus Group with raiding several blockchain projects. OFAC linked the DPRK’s group as the orchestrator of a $620 million exploit on the Axie Infinity’s Ronin Bridge suffered in March last year.

In April, Binance chief executive Changpeng Zhao intervened to seize and recover $5.8 million. The proceeds were linked with Lazarus Group following the detection of the movement of ill-gotten earnings across the Binance exchange.  

North Korea Hackers Raid Crypto Exchanges in Asia

Coordinated action against North Korea’s cybercrime syndicates is critical with the Elliptic report indicating over $2.3 billion in 2022. Further, the investigative report indicated that Asian countries accounted for 60% of the losses to DPRK hackers. 

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The Elliptic report outlined that Japan was the greatest casualty in 2022 losing $721 million with crypto accounting for 60% of the proceeds translating to $640 million. The report as commissioned by Nikkei ranked Vietnam’s $540 million loss as second with US $497 million taking third position. Hong Kong lost $281 million to the Northern Korea hackers. 

The blockchain-based analytic firm attributes the loss of $721 million from Japan as over 8 times the value of North Korea’s 2021 exports. The vulnerability of Japan, Vietnam and Hong Kong arises from lax security in the countries’ cryptocurrency markets. 

Winning against the Lazarus Group in Japan, Vietnam and Hong Kong mandates deploying a coordinated enforcement action fully supported by the crypto exchanges replicating Binance and OFAC move to flag and seize the illicit revenue.


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📰 Also read:  Azalea Disavows $300K Memecoin Linked to Alleged Scammer Sahil Arora

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Stephen Causby

Stephen Causby is an experienced crypto journalist who writes for Tokenhell. He is passionate for coverage in crypto news, blockchain, DeFi, and NFT.

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