N. Korea pushes back against 16th year on FATF blacklist, calls designation 'fabricated'

North Korea pushed back Friday against the Financial Action Task Force's decision to keep it on the money-laundering "high-risk" blacklist, insisting it has worked to ensure transparency in financial transactions. The rebuke came even as the FBI, the day after the FATF ruling, named a North Korean hacking group as the perpetrator behind a $6.3 billion virtual asset heist — an accusation Pyongyang stood firm in rejecting.

According to KCNA, a North Korean Foreign Ministry spokesperson said in a question-and-answer session with a reporter Friday that the FATF decision was "fabricated by the United States and its followers under impure political motives to 'demonize'" North Korea, and had "nothing to do with us."

The spokesperson said Pyongyang had "conducted several rounds of negotiations with the organization since 2013, revised and supplemented domestic laws on anti-money laundering and counter-terrorism financing, and taken a series of proactive measures to guarantee transparency in financial transactions." The spokesperson then rebuffed the FATF, saying it had "stubbornly ignored our goodwill and sincere efforts" and had gone so far as to strip North Korea of its observer status in the Asia-Pacific Group on Money Laundering in 2024.

The FATF held the first plenary of its 35th term at the OECD headquarters in Paris from Oct. 26 to Oct. 30 and voted to maintain North Korea's high-risk status, keeping it on the blacklist for the 16th consecutive year since 2011. The task force again urged member states to terminate correspondent banking relationships with North Korean banks, close North Korean bank branches and subsidiaries within their borders, and restrict business relationships and financial transactions with North Korean entities. It also raised concerns that growing links between North Korea and the international financial system were increasing the risk of proliferation financing.

The day after the plenary, on Saturday (local time), the FBI identified North Korean hacking group "TraderTraitor" as the group behind the $6.3 billion hack of Binance, the world's largest virtual asset exchange. Kim Yo-jong, director of the Korean Workers' Party General Affairs Department, rebuffed the claim Monday in a statement, calling it "an absurd and groundless fabrication."

North Korea also criticized Japan's push to increase its defense budget. KCNA reported Friday on an article published Thursday by Pak Hak-song, a researcher at the Foreign Ministry's Japan Research Institute, titled "The Japanese neo-militarist forces' attempt to increase defense spending will only deepen the political and security crisis."

Pak argued that Japan's defense budget hike "sheds light on Japan's current reality of having cast off the shackles of a war-criminal state and embarked on a path of re-invasion." The researcher added that given Japan's economic conditions — persistent inflation and a weak yen — it was questionable whether the country could sustain such spending, warning it would "only darken the outlook for Japan's economic recovery and impose an excessive burden of hardship on its people."

Meanwhile, the Standing Committee of the Supreme People's Assembly convened its 15th-term second plenary session at the Pyongyang Assembly Hall on Thursday. The session adopted amendments to the Construction Law and the Precious Metals Management Law, and voted to recall — effectively dismiss — a vice chairman of the Supreme People's Assembly and a standing committee member. The identities of those dismissed were not disclosed.

The revision to the Construction Law may be intended to support Kim Jong-un's "Local Development 20×10 Policy." The post of standing committee chairman remains vacant. Jo Yong-won was appointed to the position in March but was reassigned as a party secretary just three months later.