Kim's Cash Flow: The Brutal Money System of North Korea | ENDEVR Documentary

foreign North Korea is like Game of Thrones but without the dragons it's an aristocratic society and capitalist and everything is geared to make sure that there's as much cash for Kim as is possible [Music] Bureau 39 is involved in everything that makes money for North Korea selling arms smuggling of drugs counterfeiting of U.S bills this is about hundreds of millions of dollars a year everything as I make dollars [Music] North Korea the Pariah state a dictatorship shrouded in mystery [Music] every day the official newspapers praised the heroic Deeds of the dear leader [Music] to stand still here [Music] North Korea has the fourth largest army in the world for three generations the Kim family has ruled the country with an iron fist [Music] but how does the regime manage to survive despite severe U.N sanctions and how come Kim Jong-un has enough money to threaten the world with the most powerful weapon of all time the nuclear bomb foreign [Music] North Korea a history Professor is working on answers to these questions Remco broiker from the University of Leiden in the Netherlands has been studying the enigmatic country and its rulers for years he says our image of North Korea is wrong North Korea isn't what it tells it it is just look at the country functions at the highest level what is the main goal of of the government of the regime I should say it's to make money is to make cash for Kim what intrigues me personally is how North Korea manages to make money one of the questions we were stuck with is where does the money go how much money does North Korea make for North Korea's leadership questions like these are dangerous the North Korean regime sent a letter of indictment under my name to the Dutch government charging me with three capital crimes the worst of the three was the accusation that our research my research was my name and damaged the Supreme Dignity of the supreme leader now this sounds like it's it's a funny crime rates damaging the Supreme Dignity of somebody in North Korea carries the death penalty a serious threat remco's investigations threatened to disrupt North Korea's cash flow the country is internationally isolated because of its nuclear program without legal sources of income the regime has taken to raising money illegally New York the seat of the United Nations since 2006 the UN has imposed nine rounds of sanctions against North Korea these measures are monitored by an International Panel of experts the panel consists of eight members including ex-intelligence military and financial experts for their own safety they work in secret only the coordinator Hugh Griffiths is willing to speak on camera the sanctions have a tremendous impact on one level on North Korea it means that their economy can't flourish in the way it would if they were able to sell their largest foreign currency earning Commodities legitimately so they can't ship coal legitimately they can't ship iron ore legitimately they can't ship zinc legitimately foreign currency is very important to any country no matter how oftake its economy you need foreign currency to buy the goods that are essential for your population or for your Elite group so foreign currency is pretty essential to North Korea's survival the question is what's more important to the North Korean leadership developing nuclear and ballistic missile program or seeing their economy flourish the regime decided to go for the bomb in 2005 it officially announced that it had nuclear weapons as a protection against attacks from the outside and to strengthen its power on the inside Pyongyang the city of the chosen brand new apartment blocks lined spotlessly clean Avenues here is where pyongyang's upper class resides only those who are considered loyal to the regime live here those who want to enter the capital from the outside need a permit song from pyongyang's economic research institute he's authorized to talk to journalists for example about the sanctions [Music] between the sanctions that have been put on North Korea are extremely strict I mean there's probably not been a country that has been sanctioned for diversely more more strictly at the same time they're no longer working [Music] there is a huge problem with our North Korea policy and using sanctions to try and have the regime modify Its Behavior because we're not saying anything the one entity that earns most of his money that gives you the float financially that keeps us alive [Music] many high-ranking defectors from North Korea talk about a secret government Department that said to administer the regime's secret funds allegedly Kim il-sung and his son Kim Jong-il set it up in the late 1970s and equipped it with wide-ranging powers its tasks securing an independent power base for the Kims and raising money for the nuclear bomb and the leader's personal luxury its name Bureau 39 only 200 kilometers to the southeast Seoul South Korea's hyper-modern capital one of the 10 most expensive cities in the world around 25 million people live in the metropolitan area about half the population of South Korea among them most of the 30 000 people who managed to flee from North Korea [Music] KO young Juan was a North Korean diplomat he escaped in 1991. later he was deputy director of South Korea's Institute for National Security strategy few people know more about the Kim regime's workings than he does foreign [Music] [Music] foreign talk to any prominent North Korean Exile and they'll all tell you that Bureau 39 is absolutely crucial in earnings revenues for the North Korean regime it's absolutely vital take it away everything collapses here in New York impose and monitor the sanctions against North Korea an entity as important as Bureau 39 should be heading the list of banned organizations office 39 is is normally talked about by North Korean defectors we don't really see office 39 in our investigations instead we're looking at the North Korean Banks and the shell companies that traditionally operate overseas in third countries to generate foreign currency and then that money is sent back to North Korea Bureau 39 outside of North Korea is not called Bureau 39 nobody identifies as somebody who worked for Bureau 39 so it's very difficult to slap sanctions on people you don't really know are active Kinshasa the capital of the Democratic Republic of Congo since the 1980s North Korea has been procuring foreign currency here in the heart of Africa KO young Juan witnessed a particularly spectacular case at the time [Music] is foreign [Music] Bureau 39 never acts openly but its fundraising activities span the globe [Music] ankle what in Cambodia a world heritage site [Music] over 2.5 million people visit the old Khmer temples every year selfies for the tourists foreign exchange for Cambodia Angkor Watts operating company earned more than 100 million dollars in 2018. tourism is by far the largest industry here a lucrative business also for North Korea right next to the entrance to the temples a museum that opened in 2015. at its heart is a 3D painting that depicts the history of the Khmer Empire in Monumental images throngs of tourists are guided through here every day so for the painter they're from North Korea they told one year and four months to painting [Music] and who constructed it was it was it Cambodian or North Korea the North Korean the North Korean constant Dominion circumventing un sanctions North Korea not only Built the complex but also financed it in return the North Koreans collect all the revenues for the first 10 years after that they'll share the profits the North Korean CEO doesn't want to appear in front of the camera but he says the museum makes about seven million dollars a year in entrance fees alone soon this figure is supposed to double [Music] have maintained close relations for decades were good friends a solid basis for today's business ties That contravene U.N sanctions in the evening when the museum closes the North Koreans throw another set of doors open for the hungry tourists they don't want cameras in the restaurant so we film in secret yeah we had a reservation yesterday yeah the tables are almost always fully booked it can we also sit near the casino okay then we sit here okay [Music] let's see yeah all right the menu boasts North Korean Specialties such as cold noodles and sea cucumber the prices are surprisingly High by Cambodian standards a main course costs up to fifty dollars in particular tourists from China and South Korea visit the restaurant the young women who serve here are mostly art students from Pyongyang they live and sleep above the restaurant and are often not allowed to leave the premises for years the evening at the same time they changed their costumes and get ready for the big show [Music] foreign [Music] there are 130 such North Korean restaurants worldwide three of them in Cambodia they're said to make several million dollars a year but the waitresses don't get paid for their work the dollars flow directly into the regime's secret coffers foreign no other country exploits its population as systematically as North Korea North Korean workers are deployed worldwide even in the European Union in Poland here we encounter North Korean work brigades on a building site they've been promised good wages and decent working conditions only to be treated like slaves in the evening after a 12-hour shift the workers are driven to their barracks they're monitored Around the Clock by North Korean State security foreign [Music] still one of them decides to talk [Music] [Music] um foreign [Music] foreign foreign [Music] modern slavery North Korea sends well-trained workers to Poland to toil in shipyards and on construction sites the workers families are held hostage in North Korea if the work of fleas the family at home is often severely punished the workers only own about 90 Euros per month the rest goes to the regime [Music] for Kim largely unnoticed by the International Community North Korea has sent laborers all over the world up to 150 000 in all about 40 000 of them are in Russia and up to a hundred thousand in China North Koreans also work in Kuwait Malaysia Cambodia Mongolia Oman Qatar the United Arab Emirates and in African countries under un sanctions these workers need to go back to North Korea but the practice still continues experts estimate that the regime makes up to one billion dollars a year this way defectors say that Bureau 39 is directly controlled by Kim Jong-un it manages the leadership's secret accounts the so-called Palace economy but where in Pyongyang is Bureau 39 located and how many millions flow into its coffers [Music] when we ask the North Korean official he and his translator pretend not to know foreign [Music] [Music] is one of the best kept secrets of the Kim regime only North Koreans who've escaped can talk about it openly [Music] Soul at a secret location we meet a man who used to work for Bureau 39. he was based in China his task smuggling foreign currency then he escaped his position was so important that today the North Korean regime threatens to kill him this is why he had plastic surgery to alter his face even so he only wants to be filmed from behind to understand Bureau 39 and the capitalist structures of North Korea it's important to understand its history in 1991 the Soviet Union breaks up North Korea loses one of its most important trading partners while many former socialist States now rely on market economics the Kims continue to isolate themselves when Kim Jong-il takes over from his late father in 1994 a famine breaks out [Music] during the Great Famine in the mid 90s many North Koreans starved to death the public Dairy distribution system collapsed Witnesses describe seeing mountains of dead bodies in the streets anywhere between one to three million North Koreans died so what happened is that North Koreans now knew that if they wanted to survive they could no longer trust or rely on the state from then on the rural population in particular had to be self-sufficient black Markets started to emerge all over North Korea they're called Jang madang all sorts of currencies are accepted especially American dollars and Chinese Yuan today there are countless of these markets throughout the country 400 of them are even officially licensed and provide tax income for the regime mainly food and goods from China are Bartered and sold here foreign [Music] without having in place another public distribution system people die of hunger and North Koreans are not going to let that happen again they know what happened last time [Music] from a socialist country with a economy in Ruins to a capitalist country with a hybrid economy that looks socialist but really is is really capitalist [Music] the biggest profiteers from these black markets are Pyongyang officials because of their loyalty but mainly out of financial self-interest the regime allows them to trade over the years they've become rich they sell luxury goods smuggle raw materials and invest in real estate they're called donju moneylords they enjoy the luxury and the freedom that the regime grants them but their loyalty comes at a price [Music] many donju hold senior government positions including at Bureau 39. like this man who's been hiding in Soul since he escaped born in the 90s he experienced how North Korea developed increasingly capitalist structures before his Escape he was responsible for exports Bureau 39's most lucrative business fearing the regime's Revenge he too doesn't want to be recognized foreign [Music] thank you in that respect at least North Korea's go-getters are no different from their counterparts in the West boy brothers [Music] [Music] foreign [Music] [Music] Hamburg Germany until a few years ago the North Korean State insurance company knic had a branch in an innocuous looking apartment block here [Music] six North Korean officials made deals with major European insurance companies foreign foreign foreign [Music] the European Union put the North Korean insurance company on their sanctions list the accusation co-financing of the nuclear weapons program through Bureau 39. experts estimate that with crashed helicopters and similar tricks the Kim regime earned several hundred million dollars foreign but how does the Kim regime manage to transfer the millions it makes to Pyongyang the answer is simple through diplomatic channels um [Applause] North Korea uses its worldwide network of embassies to Ferry money back to Pyongyang North Korean officials enjoying diplomatic immunity carry the money in cash in their flight baggage a simple but efficient way to ensure the cash flow doesn't stop [Music] no screen embassies have a diplomatic function but that's often mainly ceremonial but the true function is financial it's also illegal mainly North Korean diplomats are basically cash carriers for Kim they're entrepreneurs they're businessmen they may be drug lords they may be weapons Smugglers but they carry a different music passport so you can't touch them Berlin it's the North Korean Embassy the North Koreans have been renting out one of the buildings as a hostel for tourists they've been earning 38 000 Euros per month in rent using Embassy grounds for such activities is against diplomatic practices and contravenes un and EU sanctions but despite the efforts of German authorities operations have been continuing for years like any other country the main goal of the embassies is to serve the state and the North Korean State's priorities in particular so because sanctions are so comprehensive now much of the activities conducted in these embassies may be prohibited [Music] providing military supplies training and much of that has been done through North Korea's embassies particularly in Africa and the Middle East so out of all the countries in the Middle East currently the Syrian Arab Republic has the greatest levels of prohibited cooperation with North Korean military entities the father of the current Syrian despot and Kim il-sung were friends from the 1960s on back then the North Koreans helped the syrians during the war against Israel and supplied them with weapons and ammunition an important source of income right up till today [Music] using tactics similar to those of 18th century Pirates Bureau 39 runs ships under false flags and fake names according to the UN North Korea has thus managed to send large numbers of weapons and grenades to Syria between 2012 and 2017 at least 40 shipments from North Korea passed through the sewers Canal but in 2018 the UN managed to have one of them intercepted so we found something cargo on its way to Syria these were acid resistant tiles and valves which could be used in chemical weapons development but also missile fuel is highly corrosive and such tiles could be used for ballistic missile program as well the bill of leading clearly gave as an address in Syria an established front company for Syria's scientific studies Research Center the ssrc which is responsible for serious ballistic missile and chemical weapons development program the Russians still in the chemical weapons produced in these Laboratories have been used by Syria's dictator Assad against his own people for years of many others who died in agony foaming at the mouth it's a little-known fact that the Syrian chemical weapons program was created with the help of North Korean technicians and scientists Syria's scientific studies Research Center the ssrc facilities located close to Damascus homes and elsewhere in Syria and some of these sites were subsequently bombed by the United States more than a hundred missiles were fired in the joint action targeting suspected chemical weapon sites president Trump declares mission accomplished saying missile strikes against Syria by the U.S Britain and France were perfectly executed the purpose of our actions tonight is to establish a strong deterrent against the production spread and use of chemical weapons well when the Americans bombed the chemical laboratories they bumped the North Koreans there yeah whether they knew they were bombing the North Koreans I don't know but they did yes the North Korean presidents in Syria is really much underreported under-appreciated foreign not been able to count on North Korea to sell to its weapons is guided missiles it's chemical laboratories perhaps Assad would not have emerged as a Victor from the struggle third of all buildings in Syria have been destroyed a tragedy and a business opportunity the Syrian regime hopes for billions from International donors for the Reconstruction of the country the necessary work brigades are to come from North Korea the two countries signed a contract at a meeting in June 2019. dirty deals between despots the money that's earned by office 39 it goes straight into the covers of the leadership it is used on the one hand to provide for luxury items it is used to pay for the Mercedes-Benz cars that somehow found their way into North Korea despite the sanctions but it also it is also used and this is probably more important to deliver the best hackers you can you can trade as early as the mid 80s Kim Jong-il started training the most talented children in terms of mathematical abilities and programming abilities to become cyber hackers they're also good money earners ransomware like the wannacry fires for example is considered to come from the North Koreans it is the biggest Cyber attack the world has ever seen hundreds of thousands of computers around the world in about 150 countries rendered useless now the U.S government is publicly placing the blame for that cyber assault uniquely dubbed wannacry squarely on Kim jong-un's Army of hackers British intelligence officials and Microsoft had previously concluded that groups associated with the North Korean regime were responsible for the wannacry hack foreign computer Specialists are hot on the heels of North Korean hackers Simon Choi works as a consultant for South Korean intelligence agencies [Music] North Korea has limited access to the internet only one thousand IP addresses are available to the country North Korean computer Specialists use them to attack other countries experts estimate that between 600 and 1300 hackers work for Kim uh experts estimate that up to 2 billion dollars have been stolen by Young highly trained North Korean hackers foreign has developed an efficient education system for its upper middle class here at Pyongyang Middle School the children who will later be computer Specialists scientists and Engineers are trained to shape the future of the country at home or abroad hello everybody nice to meet you I'm here I'm eight years old but I will still don't I can't speak English I guess speaks Chinese I just speak Russian too I'm counting on the ever course it's refined thank you the students also learn how to use computers they have access to a very limited North Korean version of the internet uncensored variety is strictly forbidden [Music] with Korea's rulers know that once the doors to the digital world have been thrown open they can never be shut again but despite all precautions in 2007 North Korea faced the first Digital Data leak in its history because a lot of classified information is now available digitally it can easily be copied and smuggled out of the country for example the data of pyongyang's Municipal registry with more than 2 million entries Professor broiker obtained a copy and is currently analyzing it using special software [Music] we never had this kind of up-to-date information effort if you want to understand the system the regime the party if you want to understand Pyongyang if you want to understand North Korean economic activities in and outside of the country this is really the stone of Rosetta [Music] we can now actually go about analyzing and mapping Pyongyang for the first time and we're no longer dependent on anecdotes on people who tell us where where all the buildings are we can actually now see who's inside the buildings what companies there are what departments there are and where you should locate them the main building of Bureau 39 is close to the seat of power right in the middle of Pyongyang just as stone's throw away from the headquarters of the Workers Party [Music] it's divided into six main departments and employs several thousand people in Pyongyang alone they have their own Fleet of vehicles kindergartens a golf course an ostrich farm and even their own bank these six main departments are in turn responsible for hundreds of individual companies throughout North Korea they control iron ore and diamond mines jewelry factories and textile companies they're mainly specialized in exporting Goods abroad other companies in the bureau earn foreign exchange through forced labor arm smuggling and insurance fraud but one rule applies to all the name Bureau 39 is never mentioned outside North Korea so it remains invisible impossible for un sanctions monitors to Detectives [Music] foreign [Music] North Korea is changing an impoverished socialist state has turned into a country with a highly flexible Shadow economy in many ways North Korea is run like a commercial company all that matters is cash for Kim the workers here are no longer slaving away for the revolution but for the wealth of their leader and his cronies the gap between rich and poor is widening while the population in Pyongyang enjoys a constantly growing Prosperity forty percent of the rural population still suffer from malnutrition in order to control its people the regime employs Cold War era socialist tactics North Korea's Shadow economy on the other hand is 21st century capitalist what the database shows Beyond any doubt is that office 39 not only exists and now we can prove what it does it owns companies it operates these companies as exports close it exports tobacco it exports all kinds of things and that is actually um quite an important development in understanding how North Korea manages to earn money abroad and we now know exactly through what kind of departments through what kind of companies office 39 does this Kim jong-un's grandmother a model Factory 1600 workers are employed here most of them women they sought process and boil the cocoons of the silkworms to obtain the precious yarn the silkworms come from a province south of Pyongyang about 200 tons of silica produced here every year a luxury product expensive and labor-intensive the Factory's entire production is intended for export abroad but the supervisors are unwilling to disclose who the foreign customers are I'm not sure anymore who suffers under the sanctions it's a hassle I'm Sheriff from North Koreans but I do find ways around it one of the problems is that neither China nor Russia is um is helping in enforcing the sanctions [Music] foreign [Music] Factory textiles are the second most important North Korean export product after coal [Music] [Music] thank you foreign [Music] foreign North Korea's gateway to the world and a symbol of how futile the un's efforts are to dry out Kim's sources of cash a Korean friendship Bridge across the yalu river has been connecting China and North Korea since 1943. it's one of the few ways to enter or leave North Korea every day trucks queue in front of the Customs checkpoint Smugglers Traders and also the agents and entrepreneurs of Bureau 39 they're all hoping for a quick deal here China is by far North Korea's most important trading partner Financial experts estimate that 90 of North Korea's exports go to its powerful neighbor in the North [Music] thousands of North Koreans are said to work in textile factories in the region disguised as businessmen and equipped with hidden cameras we film in one of the factories Chinese textile companies hire North Koreans because their wages are lower than those of Chinese workers these seamstresses work day and night and often sleep on the company premises they're likely to be locked up for years far away from their families [Music] together with a team of labor lawyers trade experts and data specialists ramcobroker tries to find out whether European Brands work with Chinese companies that directly or indirectly employ North Koreans but we found out different things and one of the things we were actually hoping to establish was the use of North Korean workers in Chinese factories but what we found really to our surprise is that yes we do have North Korean workers working on the slave-like conditions in China but more than that Chinese factories Outsource to North Korean factories in North Korea [Music] we've managed to prove the existence of a significant amount of North Korean slave labor in the supply chain of some of the world's leading clothing companies basically in Europe and in the US we've come to an agreement that we no longer wish to find slave labor or child labor in our supply chain so there are all kinds of agreements in place but if you look closer at some of these producers you find that sometimes up to 90 percent of the production does not take place in China it does not take place in the factories where the European and the American Auditors come to check whether working conditions are decent yes they are in those factories but that's only where 10 of the products is made the other 19 comes from North Korea broadcast team investigated one Chinese textile company more closely it's called vondest their website states that the company relies on low labor costs and abundant Human Resources their list of customers reads like a who's who of international fashion brands the website features a men's jacket next to it it says Korean imported the buttons carry a label Armani jeans using trade databases broadcast team analyzed long desk's business relations between 2013 and 2019. the databases use Customs data showing which goods are sent back and forth between companies in different countries so what happens is that China sends the material to make certain types of clothes to North Korea one month later they sit back in the same container and then you have finished close those clothes are again shipped to say the Netherlands or to Germany or to America and from there they're distributed into our stores between 2013 and December 2016 vondest sent around 10 million dollars worth of fabrics and raw materials to North Korea during the same period vondest received Finnish garments worth almost 25 million dollars from North Korea Customs classified textiles by so-called HS codes a ladies sweater for example has a different HS code than men's jeans we take a closer look at HS code 6201 it stands for men's anoraks and jackets like the Armani jacket on the website between 2013 and December 2016 vondest imported garments worth 12 million dollars with this code from North Korea the same code is also used for deliveries from Von desk to Europe and the US among the customers Armani Armani jackets that look exactly like the one on Von dest's website can also be bought in Europe this one costs 219 Euros it can't be proven Beyond doubt where the garments like this one are made in North Korea but can it be ruled out we ask the fashion brands Amani writes we confirm that vondest is one of our suppliers and as such as regularly subject to checks and inspections the result of these checks being that no finished products are manufactured in North Korea like all our suppliers it's also required to declare which subcontractors it uses and where these are concerned it's also the case that none are in North Korea we've also contacted Von dest in writing the company offered no explanation as to why and to what extent it trades with North Korea one thing can be said for certain well-known fashion brands have their goods manufactured by a Chinese company that cooperates with North Korea a country where workers have no rights where human life counts for nothing breuka's investigation shows that this is not an isolated incident [Music] for years and years we've heard testimonies from North Korean skps who were in concentration camps today had been forced there to produce textiles for the export markets for a famous Western Branch and I think for the first time I've been able to corroborate that through an external Source or not through a testimony in the same database I found the the department of bureaucratic Department that is responsible for managing the production of textiles for one of the concentration camps outside [Music] it means that we not only buy clothes produced by forced laborers maybe even slave labor we may even buy clothes in the Netherlands in Germany all through Europe in America that was made in concentration camps by people who will never see the the last day again these are the kinds of camps that you don't leave until you dance that is just too horrific to to put in words and very complicit hundreds of thousands of men and women secretly ensure the survival of the dictatorship their Futures are sacrificed for the luxury of the regime and for our prosperity Kim Jong-un is not a crazy dictator but a coolly calculating businessman who runs his country like a company his bureau 39 does business with everything and everyone including us [Music] [Music] [Applause] [Music] foreign [Music]

Channel: ENDEVR

Views: 3,177,710

Keywords: Free documentary, documentaries, full documentary, hd documentary, documentary - topic, documentary (tv genre), Business Documentary, Bureau 39, room 39, office 39, north korea documentary, north korea, kim jong un documentary, kim jong un, kim jong-un, north korea news, bureau 39: cash for kim, bureau 39 north korea, inside north korea

Id: hhYJcOIuVGA

Length: 58min 24sec (3504 seconds)

Published: Sun Nov 27 2022