In the grainy world of international espionage, money launderers are often depicted as men in suits carrying briefcases. But Sim Hyon-sop, the man now topping the FBI’s wanted list with a $7 million bounty on his head, preferred a Toyota Land Cruiser and digital wallets. U.S. authorities have identified Sim as the financial architect behind a massive illicit network that converted millions in stolen cryptocurrency into tangible goods for Pyongyang—ranging from raw tobacco to helicopters.
According to a new report by the Wall Street Journal and data from the Financial Action Task Force (FATF), Sim is one of dozens of North Korean bankers operating in the shadows abroad. Yet, his operation stands out for its scale and audacity, allegedly duping some of the world’s largest financial institutions while funding the Kim Jong-un regime’s lifestyle and weapons programs.
The Phantom of the Foreign Trade Bank
Sim Hyon-sop is an exceptional banker in North Korea. He graduated from one of Pyongyang’s top colleges and can speak English and Chinese very well. This has helped him serve the regime well as an employee of the state banking system. Operating under aliases such as “Sim Ali” and “Sim Hajim,” he was dispatched to the Middle East as a representative of the Korea Kwangson Banking Corp, a subsidiary of North Korea’s sanctioned Foreign Trade Bank.
Ryu Hyun-woo, a former acting chargé d’affaires at the North Korean Embassy in Kuwait who defected in 2019, described Sim as a well-connected operative who lived a lavish lifestyle. “He would pick me up in a Toyota Land Cruiser,” Ryu recalled, noting that Sim frequently dined with other operatives and openly bragged about his methods. “Sim described to me how he would launder money… moving it between different countries and shell companies.”
A Digital Laundromat
The core of Sim’s operation was a sophisticated “digital laundromat.” According to U.S. indictments, the funds largely originated from North Korea’s army of IT workers—thousands of programmers sent abroad to work freelance jobs under false identities—and state-sponsored hackers who stole cryptocurrency from exchanges.
The illicit wealth that Sim received was sent to him via digital currency (Tether (USDT)). Sim used a method called “peeling” or “chain hopping” to create a ‘paper trail’ for the illicit funds by routing them through thousands of wallets digitally. After multiple transfers, the cryptocurrency was sent to OTC brokers in China and the UAE and exchanged there for fiat, thereby thoroughly obscuring the fact that North Korean money had been used in this way.
From Tobacco to Helicopters
After successfully clearing the funds from any trace of criminal offence, Sim began making purchases using those funds. Sim’s purchase log gives a clear insight into what the regime considers a priority, keeping the elite loyal to the regime by providing them with the resources they require and therefore enabling them to continue generating cash for the government.
According to investigators, Sim acquired laundered funds and used them as raw materials to manufacture counterfeit cigarettes, as well as the brand name “Marlboro” and a number of other products. The government of North Korea has profited heavily from the cigarette trade, providing them with an alternate method of generating “hard” currency while avoiding government sanctions. However, the purchases made using laundered funds did not solely consist of illegal products. In fact, in at least one documented case, Sim helped facilitate a purchase of helicopters, communications devices, and a variety of other items that are considered “controlled” by the United Nations. These products were then shipped to North Korea and were often configured through third-party countries for customs evasion.
Duping Wall Street
The alarming thing about Simon’s business was his ability to take advantage of the Western financial system. Simon’s network moved money through the financial heart of the United States (Wall Street) despite being subject to strict sanctions.
According to documents obtained from the court, American banks, such as Citibank, JPMorgan Chase, and Wells Fargo, unknowingly processed more than 310 transactions totaling nearly $74 million to the government of North Korea. In addition, large European banks such as Deutsche Bank and HSBC were also involved.
Simon used shell companies with innocuous names to obscure the true beneficiaries and to deceive the banks into serving as financiers for the government of North Korea when they were prohibited from doing so by law.
The China Connection
The dragnet began to close in 2019 when the UAE revoked Sim’s residency visa in compliance with UN sanctions. However, the COVID-19 pandemic delayed his expulsion, buying him nearly three years of operational time. By the time he left, he had allegedly moved millions more.
Sim’s current whereabouts remain the subject of intense speculation. The U.S. Treasury Department believes he relocated to Dandong, a Chinese city on the border with North Korea that has long served as a hub for illicit trade. The FBI’s $7 million reward is a clear signal that Washington views him as a high-value target, but geopolitical friction complicates any arrest. The official statement issued on behalf of the Chinese government stated that they don’t know anything about what Mr. Sim was doing, and they do not support “unilateral actions taken by the US Treasury to impose economic sanctions.”
For now, the “Ghost Banker” remains at large, likely still moving money in the shadows, while the U.S. government bets $7 million that someone in his circle is ready to talk.
