Moscow Authorities Detain British National Accused of Aiding North Korea in Crypto Sanction Evasion

A British citizen who is wanted by the FBI for allegedly assisting the North Korean government to evade U.S. sanctions via crypto is in the custody of Russian authorities. 

Christopher Emms, a 31-year-old who has a red notice from Interpol for consulting North Korea on cryptocurrencies, has been arrested in Moscow, according to a report by local media outlet Ridus.

“Christopher Douglas Emms is wanted for allegedly conspiring to violate the International Emergency Economic Powers Act (IEEPA),” the announcement said. 

Emms, alongside Spanish national Alejandro Cao De Benos, reportedly provided instructions to North Korea on how it could use blockchain and cryptocurrency to launder money and evade sanctions in April last year. The duo planned and organized the 2019 Pyongyang Blockchain and Cryptocurrency Conference.

During the conference, both answered questions about blockchain and crypto technologies from the North Korean audience, including persons working for the government in Pyongyang. They also proposed plans for creating smart contracts for the DPRK and mapped out crypto transactions designed to avoid U.S. sanctions.

In late January 2022, the Southern District of New York issued an arrest warrant for Emms, charging the British citizen with conspiracy to violate the International Emergency Economic Powers Act (IEEPA). 

Emms won an extradition case against the U.S. in 2022 after being detained in Saudi Arabia for eight months. After Saudi Arabia rejected the U.S. government’s extradition request, Emms left the middle eastern country and moved to Russia, where he was offered residency.

Virgil Griffith, a former Ethereum developer, was allegedly involved in the scheme, too. He participated in the 2019 Pyongyang Blockchain conference alongside Emms and De Benos. 

As reported, Griffith was arrested by the Federal Bureau of Investigation in November 2019, pleaded guilty to the FBI’s charges of sanctions-related violations at a hearing in 2021, and was sentenced to 63 months in prison.

North Korea Used Stolen Crypto to Fund Missile Program

The harsh stance against those who provided North Korea assistance in regard to cryptocurrencies comes as the country has been using crypto to fund its missile and nuclear weapon programs. 

Earlier this year, the White House said that North Korean hackers had stolen more than $1 billion worth of crypto in the past two years, adding that Pyongyang has used the funds to support its missile program.

The United States Secretary of Homeland Security Alejandro Mallorcas claimed that North Korea had “funded” its “weapons of mass destruction programs” through “cyber thefts” of crypto and fiat – to the tune of over $1 billion in the past 24 months.

It is worth noting that North Korean hacking groups account for a huge portion of illicit cyber activities. Just recently, South Korean and United States intelligence agencies warned that Pyongyang-based hackers are trying to hit “major international institutions” with ransomware attacks. 

In December 2022, Kaspersky also revealed that BlueNoroff, a subgroup of the North Korean state-sponsored hacking group Lazarus, is impersonating venture capitalists looking to invest in crypto startups in a new phishing method.