- [Kento] I'm Kento Bento. This video is made possible by Dashlane. Download Dashlane for free
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the link in the description. Kuala Lumpur, Malaysia. February 13th, 2017. A frantic Korean man approached
an airport receptionist in the departure hall of Terminal 2, in Kuala Lumpur International Airport. He claimed someone had
grabbed him from behind and splashed a mysterious
liquid on his face, and he was now in some discomfort. The receptionist sent him to
the airport's medical clinic to be looked at by doctors, but it wasn't long until
he became unresponsive. Less than 20 minutes later, he was dead. The liquid that was smeared on his face
turned out to be VX nerve agent, a chemical weapon categorized
as a weapon of mass destruction. The victim was Kim Jong-nam, the half-brother of North
Korea's Supreme Leader, Kim Jong-un, who likely gave the order. Before his untimely death, Nam was set to return home to Macau
after a business trip in Kuala Lumpur. Macau was where he had lived anonymously
with his family the past two decades. But while he never made it back, the aftermath of his assassination
brought a great deal of unwanted attention to the Chinese city he lived in, for the long-standing
secretive relationship between Macau and North Korea
was now in the limelight. Macau is a city on the western side of the Pearl River
Estuary, in Southern China, about 2,200 kilometers or
1,400 miles from the Hermit Kingdom. It is known for being many things, the most densely populated
region in the world; a former colony of the Portuguese Empire; one of only two special
administrative regions of China; and, what most may know it
as, the Las Vegas of Asia. But there's one more title, because for the past five decades, it has also been North Korea's
International Base of Operations. Since the 1950s, the United States,
along with a number of other countries, had imposed numerous
sanctions on North Korea, affecting their financial
assets and banking transactions. This led to the Kim Regime pursuing other avenues to
connect with the outside world. Now, in the late 1950s, a small group of North
Koreans close to Kim Il-sung, grandfather to Kim Jong-un and
the first in the Kim dynasty, arrived in Macau and Hong Kong. Both cities were attractive to the regime due to the multitude
of international banks, and the relative ease in which
they could engage in illicit activities, remember back then Macau was
still a Portuguese colony, and Hong Kong a British one. Both cities provided a
favorable environment for the North Koreans, but it was Macau, in particular, that had
the distinct advantage. You see the Chinese authorities
had always exercised more control and influence over the smaller territory, which meant for the North Koreans it was a much better place
for their shady businesses and clandestine operations. In the Korean War, China,
along with the Soviet Union, had supported the communist North, and since then had maintained
close diplomatic relations. Hong Kong was also under British rule, and the British were allied
with the imperialist Americans who they had just fought
in the Korean War, so that option was certainly less ideal. Macau, on the other hand, was ruled by the Portuguese
who had remained neutral in world affairs keeping
out of foreign conflicts. So it seemed clear Macau
was the way forward. In the decades that followed, North Korea went on to establish
Macau as a financial and logistical hub, acting as their point of
contact with foreign markets. Indeed there were illicit activities, but many were legitimate
involving property investments, restaurant startups, and the purchasing of
various standard goods. During this early period,
economic growth in North Korea was actually higher than in South Korea, but as we all know, this didn't last. The 1970s and '80s saw mismanagement by the government leading
to economic stagnation. Things got worse with the
fall of the Berlin Wall and the collapse of the Soviet Union where a significant portion of
aid to the Hermit Kingdom was halted. By this point, North Korea
was in dire need of money, and their illegal endeavors
seemed a viable way out. And so from the '90s onwards,
Macau gained an even more important role in their global strategy
to finance the regime. The North Koreans
increased their activities in the city with more black market trade, drug trafficking, the
passing of counterfeit money, counterfeit goods and the
procurement of weapons systems. Now much of this made its way through a secret department of the
North Korean government based in Macau, called the
Zokwang Trading Company; which officially dealt with machinery
and textiles trade, pretty ordinary stuff, but in reality functioned as
a sort of criminal enterprise. It is said to be the most
potent overseas tool of the North
Korean government. Of course, Zokwang and
North Korea deny this but many sources have backed this up, including Ok Hwa, a
former North Korean agent who claimed to have
spent six months training at the offices of the
Zokwang Trading Company. She was assigned to live in
Macau and to learn Cantonese in order to impersonate
local Chinese residents, which came in useful when sent
on one of her many overseas missions. The most infamous being the
bombing of Korean Air Flight 858 in 1987, which killed 115 people. Speaking of, the Zokwang
offices was allegedly the planning base of many terrorist acts over the years, including
the deadly Rangoon Bombing in Burma, present-day Myanmar,
with an assassination attempt of then-South Korean
President Chun Doo-hwan. But it doesn't end there, because in 1995, a new opportunity arose for the regime when Macau opened their
very first airport, the Macau International Airport. North Korea's state-owned
airline, Air Koryo, sought to open a branch in the city, which led to the launch of a new flight between Pyongyang and Bangkok
with a stopover in Macau. The thing about the flight
though was that the frequency was irregular, sometimes
weekly, sometimes monthly, and it carried basically no passengers. But that didn't matter, because for them it was
really all about the cargo, luxury items for the elites like whisky, brandy and cigars rather made the journey, as well as contraband goods
such as counterfeit cigarettes, weaponry, heroin and crystal meth, all helping to finance the regime. Now the Portuguese authorities in Macau did try to stem the
North Korean activities but their efforts were
somewhat ineffective, which isn't too surprising
considering their inability to control even the local triads. The turf wars got pretty crazy. But regardless, the Portuguese
still gave them pushback, which is why, in 1999, when Portugal handed Macau back to China to be ruled as a special
administrative region, just like Hong Kong was two
years earlier from the British, it was a huge win for North Korea,
as it gave them an even greater boost. As the managing director
of Zokwang himself put it, "Our nation has more friendly
relations with China. Compared with the previous
Portuguese government, it is easier for us to stay here, do business and apply for documents." He, of course, was referring
to their legal ventures, but it's a statement that likely
extends to all their activities. Now around this time
was when Kim Jong-nam, the half-brother, known
to his friends as Johnny, made his way to Macau. He had previously served as North Korea's Ministry of Public Security in Pyongyang, and was the heir apparent
to his father Kim Jong-il. But then, after an embarrassing incident where he was arrested
for using a fake passport to visit Tokyo Disneyland, he lost favor, and his younger brother
Kim Jong-un became leader. Regardless, Johnny Kim still
maintained a relationship with the regime and now, based in Macau, was said to have fulfilled the
role of a kind of middleman in dealings between North
Korea and the outside world. But the outside world was
about to change everything, because in January 2002,
the American president, George W. Bush, coined
the term Axis of Evil to describe foreign governments
that sponsored terrorism and who had sought weapons
of mass destruction, and he listed three culprits,
Iran, Iraq, and North Korea. This was the turning point. As a result, North
Korean activity in Macau was placed under heavy surveillance, as the presence of American
intelligence was strengthened. In 2005, the United
States Treasury Department accused a particular bank in
Macau, the Delta Asia Bank, of being "a willing pawn for
the North Korean government "to engage in corrupt financial
activities through Macau." Note, North Korean authorities had no access to the
international banking system, so banks that agreed to
act as intermediaries played a crucial role in
helping them evade sanctions. As such U.S. companies
and financial institutions were ordered to cut ties
with the Delta Asia Bank, which led to about $25 million
worth of North Korean funds being frozen. North Korea was not happy with this, and tried desperately
to retrieve the money. Now the truth of the matter
is that the Delta Asia Bank wasn't actually the only bank in Macau that worked with North Korea. In fact, nearly all banks in Macau had handled North Korean
funds including larger banks like the Bank of China. So the question is why was
only one bank targeted, and a relatively small bank at that? Well, Delta Asia was really
just a symbolic target. U.S. regulators singled them out because the shutdown of a smaller bank would create less financial
disruption to the system, while still getting the message across. It acted as a deterrence to
other banks, and it worked. Foreign businesses and
banks became unwilling to engage with North Korea as they didn't want to be associated
with the regime's illegal activities, as well as fearing exclusion
from the American banking system. This created a sort of informal
financial embargo of North Korea. Now there was also another reason for targeting only one bank, and that was to avoid an
all-out clash with China, while still sending a very
clear message to them. Remember North Korea's survival in general depends mostly on China,
and both parties are aware of this, which is actually why many believe that Kim Jong-un extended
a courtesy to China by assassinating his brother
Kim Jong-nam in Malaysia, rather than where he lived
in Macau, a Chinese city. It would have been a mess
for China to deal with, and this could be seen
as a sign of respect. With the spotlight now on
their activities in Macau and further economic restrictions being placed by the
international community, the North Koreans decided to pull back, and over time moved
many of their operations further north to Zhuhai,
a mainland Chinese city. This meant the Zokwang Trading Company
too had to relocate across the border. Now, fast forward to today, the North Korean presence in Macau and even in Zhuhai has dwindled. Yes, Macau is still a prominent base, and the regime's financial
networks in China, forged over decades, are
still well-established today, but they've since smartly
expanded their core operations to other regions like Central Asia, Southeast Asia, and Africa. If we look back, all their decisions, from setting up a base in Macau, to now diversifying
their channels worldwide, can be traced back to obviously Pyongyang, but more specifically
a secret organization in Pyongyang, called Room 39. This Room 39's objective has always been to seek as many ways to
earn foreign currency for the Kim family, through
illicit economic activities. It is critical for their continued power,
enabling them to buy political support and helping fund their
nuclear weapons program. Macau has been one of
their primary focuses throughout the years, but
more recently their approach has centered around hacking
and malicious cyber activities, working alongside another
government group, Bureau 121, which is North Korea's
premier cyberwarfare unit. Together they're a lethal combination
said to have robbed multiple banks around the world including, most famously,
that of the Bangladesh Bank back in 2016, with a one billion dollar heist attempt. But nation states
governments like North Korea are not the only ones
stealing people's money and taking advantage of their
poor cybersecurity practices because the UN estimates
80% of these breaches are actually from highly organized
and ultra sophisticated criminal gangs, targeting everyday people like you and I. Therefore, and we all
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use the promo code kentobento to get 10% off at checkout. Finally, big thanks and shout
out to Vim from Australia, as well as all our patrons on Patreon for supporting this channel. (upbeat music)
He has some unhealthy obsession with North Korea though, even made masturbatory video on how to destroy them.
Goes to show you how toxic American propaganda is. I mean, NK isn't the most pleasant place around but I don't want see North Koreans getting bombed either.
I mean, even in this video he emphasises on NK's illegal trade and is accusing China for helping, while it's kind of hard to stay legal when most of the "civilized" world is embargoing them to kingdom come.