U.S., N. Korea Reach Deal Over Frozen Funds - KLTV.com - Tyler, Longview, Jacksonville |ETX News

03/19/07 - Beijing, China

U.S., N. Korea Reach Deal Over Frozen Funds

The United States and North Korea have resolved a dispute over $25 million frozen in a Macao bank, a U.S. official announced Monday.

Under the deal, the funds will be transferred into an account held by North Korea's Foreign Trade Bank at the Bank of China in Beijing, according to U.S. Deputy Assistant Treasury Secretary Daniel Glaser.

The funds, which have been frozen at Banco Delta Asia, "will be used solely for the betterment of the North Korean people, including for humanitarian and educational purposes," Glaser said in a written statement from Beijing.

"We believe this resolves the issue of the DPRK-related frozen funds."

The announcement was made before six-party nuclear disarmament talks resumed in Beijing, and the bank dispute had threatened to impede those talks. In addition to North Korea and the United States, the talks involve South Korea, Japan, Russia and China.

On Saturday North Korea's lead nuclear envoy said his government would not close its main Yongbyon nuclear facility until all $25 million of its frozen money frozen at Banco Delta Asia was released, The Associated Press reported.

The United States suspects some of the funds are linked to counterfeiting or money-laundering by North Korea, according to AP.

"The events of the past 18 months demonstrate our lack of tolerance for illicit activity conducted in the global financial system. Financial institutions that facilitate weapons proliferation, terrorist financing, narcotic trafficking, and other illicit financial activity should be on notice of the significant consequences they face," Glaser said in his statement.

The United States agreed to resolve the frozen funds issue as part of a deal made last month.

U.S. envoy Christopher Hill said the six-party talks could now "move on to the next problem, of which there are many," AP reported. Next on the agenda are fuel oil for North Korea, the declaration and disabling of its nuclear programs, and the disbursement of more aid, Hill said, according to AP.

Story courtesy of CNN Newsource.

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