The United States has accused the Democratic People's Republic of Korea (DPRK or North Korea) of counterfeiting U.S. $100 Federal Reserve notes (Supernotes) and passing them off in various countries. There is considerable doubt, however, that the DPRK is capable of creating Supernotes of the quality found. It is thought that the alleged counterfeiting activity in the DPRK is government sponsored (not criminal activity). What has been confirmed is that the DPRK has passed off such bills in various countries and that the counterfeit bills circulate both within North Korea and around its border with China. In June 2009, press reports claimed that the DPRK produced counterfeit U.S. bills even after 2007. Although Pyongyang denies complicity in any counterfeiting operation, estimates are that at least $45 million in such Supernotes of North Korean origin are in circulation and that the country has earned from $15 to $25 million per year over several years from counterfeiting. South Korean intelligence has corroborated information on past production of forged currency—at least until 1998—and several U.S. court indictments indicate that certain individuals have been accused of distributing such forged currency. In 2009, the State Department reported that counterfeit $100 U.S. notes (Supernotes) continue to turn up in various countries, including in the United States, although it is not clear whether these notes are new or from existing stocks Counterfeiting is considered to be one of several illicit activities by the DPRK apparently done to generate foreign exchange that is used to support the ruling regime, purchase imports, and finance government activities abroad. It also is a direct attack on a protected asset of the United States and a violation of U.S. and other laws. U.S. policy toward the alleged counterfeiting is split between law enforcement efforts and political and diplomatic pressures. On the law enforcement side, individuals have been indicted, and in September 2005, the U.S. Treasury named Banco Delta Asia (BDA), bank in the Chinese territory of Macao, as a primary money laundering concern under the Patriot Act, Section 311. At the time, Pyongyang promised that it would punish the counterfeiters and destroy their equipment. Following the BDA case, law enforcement efforts at the national level have become entwined with diplomatic efforts and pressures to resolve the issue of the North Korean nuclear weapons and potential ballistic missiles. Hence, open source information on the scope and scale of DPRK counterfeiting and distribution operations is largely incomplete. Moreover, media reports on January 20, 2006, stated that Chinese investigators have independently confirmed allegations of DPRK counterfeiting. On February 13, 2007, a new six-party agreement on North Korea's nuclear program and energy needs was concluded.
The United States has accused the Democratic People's Republic of Korea (DPRK or North Korea) of counterfeiting U.S. $100 Federal Reserve notes (Supernotes) and passing them off in various countries, although there is some doubt by observers and other governments that the DPRK is capable of creating Supernotes of the quality found. What has been confirmed is that the DPRK has passed off such bills in various countries and that the counterfeit bills circulate both within North Korea and around its border with China. Defectors from North Korea also have provided information on Pyongyang's counterfeiting operation, although those statements have not been corroborated. Whether the DPRK is responsible for the actual production or not, trafficking in counterfeit has been one of several illicit activities by North Korea apparently done to generate foreign exchange that is used to purchase imports or finance government activities abroad.
Although Pyongyang denies complicity in any counterfeiting operation, at least $45 million in such Supernotes thought to be of North Korean origin have been detected in circulation, and estimates are that the country has earned from $15 to $25 million per year over several years from counterfeiting. The illegal nature of any counterfeiting activity makes open-source information on the scope and scale of DPRK counterfeiting and distribution operations incomplete. South Korean intelligence has corroborated information on North Korean production of forged currency prior to 1998, and certain individuals have been indicted in U.S. courts for distributing such forged currency. Media reports in January 2006 state that Chinese investigators had independently confirmed allegations of DPRK counterfeiting. In June 2009, press reports claimed that the DPRK produced counterfeit U.S. bills even after 2007.
For the United States, the alleged North Korean counterfeiting represents a direct attack on a protected U.S. national asset and may provide a rationale to impose financial sanctions on the DPRK. The earnings from counterfeiting and related activities also could be important to Pyongyang's finances. Profits from any counterfeiting also may be laundered through banks or other financial institutions.
U.S. policy toward the alleged counterfeiting is split between law enforcement efforts and political and diplomatic pressures. On the law enforcement side, individuals have been indicted and the Banco Delta Asia (BDA) bank in Macao (a territory of China) was named as a primary money laundering concern under the Patriot Act. In June 2007, the BDA issue was resolved and the Six-Party Talks resumed. At the time, Pyongyang promised that it would punish the counterfeiters and destroy their equipment. The law enforcement effort has become entwined with diplomatic efforts and pressures to resolve the North Korean nuclear and missile issues. Following North Korea's second nuclear test and several missile launches in May 2009, the United States reportedly has been considering further financial sanctions on the DPRK based partly on its alleged counterfeiting.