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Friday, September 2, 2011     FOR YOUR EYES ONLY

U.S. sanctions banks facilitating Syria-N. Korea WMD cooperation

WASHINGTON — The United States has imposed the first penalties on banks that facilitate Syria's ballistic missile and weapons of mass destruction programs in cooperation with North Korea.


Officials said North Korea was the leading missile developer for and supplier of Syria. They said Pyongyang helped the regime of Syrian President Bashar Assad establish serial production of the medium-range Scud D missile.

The Assad regime was also said to have used its banks to help North Korea's missile exports. Treasury said Commercial Bank, based in Damascus, was believed to have been helping the Korea Mining Development Corp., Pyongyang's leading arms dealer and main exporter of ballistic missiles.

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The sanctions, the third set imposed by Washington since May, targeted financial support for a leading Syrian missile research facility, the Scientific Studies and Research Center.

"SSRC controls Syria's missile production facilities and oversees Syria's facilities to develop unconventional weapons and their delivery systems," the Treasury Department said.

The sanctions included the state-owned Commercial Bank of Syria, with 50 branches, as well as North Korea's Tanchon Commercial Bank. SSRC and Tanchon first came under U.S. sanctions in 2005.

"The Commercial Bank of Syria has continued to provide financial services to the SSRC and associated companies following the SSRC's designation, including the maintenance of bank accounts and financing for purchases that permit the SSRC and associated companies to advance Syria's WMD programs," Treasury said.

In 2010, Treasury said, Commercial Bank arranged financing for SSRC to purchase missile-related equipment. No details were given.

"By exposing Syria's largest commercial bank as an agent for designated Syrian and North Korean proliferators, and by targeting Syria's largest mobile phone operator for being controlled by one of the regime's most corrupt insiders, we are taking aim at the financial infrastructure that is helping provide support to Assad and his regime's illicit activities," Treasury Undersecretary David Cohen said.

The administration also designated Syria's largest mobile phone operator for sanctions. SyriaTel was identified as being owned by Rami Makhlouf, a cousin of Assad and regarded as a leading financier of the regime.

"Despite attempts to obscure his controlling interest in Syriatel, Makhlouf has continued to own and run the telecommunications company," Treasury said.

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