- The Washington Times - Saturday, June 6, 2009

The United States said Friday it is considering slapping its own financial sanctions on North Korea in addition to whatever punishment the United Nations imposes for the North’s recent nuclear test.

State Department spokesman P.J. Crowley told reporters that U.S. action “within the banking sector certainly did get North Korea’s attention previously, and if we can find ways that we can do that, we will do so.”

In 2005, nuclear talks reached a crisis when the United States blacklisted a bank in the Chinese territory of Macao accused of cooperating in North Korean money laundering and other illicit activities. The U.S. crackdown is believed to have severely hurt North Korean financial dealings, effectively severing the North from the international financial system as worried banks quit dealing with Pyongyang.

The U.S. search for “financial levers” is meant to push North Korea back to stalled nuclear disarmament talks, Mr. Crowley said. “That’s our ultimate objective, and we will continue to use whatever levers that we see available and we think will be effective,” he said.

He did not provide specific details of possible U.S. sanctions.

A South Korean newspaper reported Friday that U.S. Deputy Secretary of State James Steinberg briefed South Korea’s president on possible U.S. sanctions, calling for blacklisting foreign financial institutions that help the North launder money.

Mr. Steinberg was accompanied during recent meetings in Asia by Stuart Levey, a senior Treasury Department official who oversaw the Macao bank’s blacklisting in 2005.

After the blacklisting, six-nation nuclear talks reached an impasse after the North refused to move on its pledge to shut down its nuclear reactor until it received $25 million in frozen funds in accounts at Banco Delta Asia in Macao.

Mr. Crowley said Mr. Levey’s presence on Mr. Steinberg’s trip indicates that the United States is “looking at other ways that we can bilaterally put pressure on North Korea to return to a negotiating process.”

His comments came as the North appeared to be preparing to test a missile that could reach the United States. Last week, Pyongyang conducted a barrage of missile launches and an underground nuclear test that violated previous U.N. Security Council sanctions.

Diplomats at the United Nations are trying to reach an agreement on new sanctions against North Korea for defying the Security Council and conducting a second nuclear test.

Meanwhile, the North was keeping quiet about its trial of two American journalists in its top court Friday on allegations they entered the country illegally and engaged in “hostile acts.” North Korea’s official news agency said the proceedings against Laura Ling and Euna Lee of Current TV were to begin Thursday, but no further details were available one day later.

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