U.S. bank helps clear hurdle to shut reactor

The Bush administration has found a U.S. bank willing to accept $25 million in North Korean funds, and officials hope the transfer — the final hurdle to the closure of the North’s main nuclear reactor — can take place in the next few days, The Washington Times has learned.

The resolution of the issue would end a weeks-long effort by U.S. officials to find a bank in any country that will agree to accept the money — which has been linked to illicit activities — in exchange for guarantees that it will not be penalized.

Lawyers at the State and Treasury departments are seeking the best way to allow the transfer without breaking U.S. law.

The money is currently deposited in 52 accounts at Macao’s Banco Delta Asia (BDA), which was designated by the Treasury Department in 2005 as a “primary money-laundering concern” under Section 311 of the Patriot Act.

U.S. officials did not identify the American bank, although they suggested that it is not one of the bigger and more recognizable institutions.

The highly unusual decision to let North Korean money labeled by the Treasury as “dirty” be deposited in a U.S. bank — entailing full access to the international financial system — was made by Secretary of State Condoleezza Rice and Treasury Secretary Henry M. Paulson Jr., officials said.

No official agreed to speak on the record because none was authorized to discuss the matter and no decision has been made to disclose the development publicly.

Miss Rice’s purpose, they said, was to remove what Pyongyang says is the only remaining obstacle to shutting down its Yongbyon nuclear complex, as agreed on Feb. 13 in six-party talks in Beijing. Mr. Paulson is said to have agreed with Miss Rice because he does not want to risk his good relations with Chinese officials.

“I think we are getting to the point where we know how this is going to be solved,” Christopher R. Hill, the top U.S. negotiator with the North, said yesterday in a speech to the Pittsburgh World Affairs Council.

“Currently, what we are doing is to assist in ways that we can to allow the North Koreans to put those accounts into another bank, where they can make use of those accounts.”

Mr. Hill avoided mention of any particular bank, but predicted that the issue will be resolved “in the very near future.”

“This time, I think we really do have something,” he said.

He added that the United States was going to great lengths to find a new home for the $25 million “because we did agree to resolve” the issue as part of the six-nation talks, which also include China, Japan, South Korea and Russia.

Pyongyang promised to close down Yongbyon by April 14 but missed the deadline, saying it will do nothing until the money leaves BDA and arrives safely in another bank.

“The bank accounts are available,” Mr. Hill said. “They can go withdraw the money in the local currency in Macao. They want to be able to move it to another bank. I think that was very much coming from the hard-liners” in Pyongyang.

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