DPRK Forum

Update: One Free Korea has a much better commentary on this story and is well worth the read.

There have been questions and charges raised regarding the so-called supernotes that supposedly came out of North Korea. I do not know the validity of these charges because I am not a currency expert. However, there are two articles today that may raise doubts. Apparently, according to one article by AZCentral.com:

WASHINGTON - Two years ago, as he was ratcheting up a campaign to isolate and cripple North Korea’s dictatorship financially, President Bush accused the communist regime there of printing phony U.S. currency.

“When someone is counterfeiting our money, we want them to stop doing that. We are aggressively saying to the North Koreans just that - don’t counterfeit our money,” Bush said on Jan. 26, 2006.

If I recall correctly, I think one of the reasons for the frozen cash ($25 million) was because of the counterfeiting and money laundering. That is understandable. In return to start disabling the Yongbyon reactor, North Korea wanted that money back. So the United States released the money with some minor complications, but the DPRK did get it. As usual, North Korea keeps moving the goal posts, but will throw a fit if others do it real or imagined. Several posts have covered this already, so that is not news.

However, a 10-month McClatchy Newspapers investigation on three continents has found that the evidence to support Bush’s charges against North Korea is uncertain at best and that the claims of the North Korean defectors cited in news accounts are dubious and perhaps bogus. One key law-enforcement agency, the Swiss federal criminal police, has publicly questioned whether North Korea is even capable of producing “supernotes,” counterfeit $100 bills that are nearly perfect except for some practically invisible additions.

Huh? How is that so? I did read an article a while back regarding the question regarding the supernote producing capability (based on their own currency being very low quality), but in my mind, that does not prove a lot. I cannot find the link, but I will post it once I do find it. But to see more information on it, you can see this link (PDF). Personally, I do not doubt supernotes exist, and I also do not doubt North Korea produced counterfeit notes because they are well known for producing other things like pharmaceuticals, cigarettes and other things for quick cash. After all, any way to make money is a good thing for a collapsed economy. However, there is a story suggesting a defector may have been telling stories:

Many of the administration’s public allegations about North Korean counterfeiting trace to North Korea “experts” in South Korea who arranged interviews with North Korean defectors for U.S. and foreign newspapers.

The defectors’ accounts, for example, were cited prominently in a lengthy July 23, 2006, New York Times magazine story that charged North Korea with producing the sophisticated supernotes.

The McClatchy investigation, however, found reason to question those sources. One major source for several stories, a self-described chemist named Kim Dong-shik, has gone into hiding, and a former roommate, Moon Kook-han, said Kim is a liar out for cash who knew so little about American currency that he didn’t know whose image is printed on the $100 bill. (It’s Benjamin Franklin.)

The Secret Service, the Federal Reserve Board and the Treasury Department all declined repeated requests for interviews for this story.

(Link mine) Hm, that is interesting, but that does not mean the entire story regarding the supernotes may be bogus:

Although banks around the world are still seizing supernotes, the Bush administration is no longer publicly accusing North Korea of producing them and has dropped the subject from talks on halting North Korea’s nuclear-weapons program, according to State Department officials.

This story seems a bit slanted, but reading in between the noise, it seems there may be more questions than answers regarding the supernotes. So the question I have for you readers is, if a defector claiming to make these notes is lying (he obviously was if he does not know the person on the bill), what is the real story behind the notes?