U.S. Squeezes North Korea's Money Flow
NYT ^ | 03/10/06 | JOEL BRINKLEY

March 10, 2006

U.S. Squeezes North Korea's Money Flow


WASHINGTON, March 9 — Six months after the Bush administration blacklisted a bank in Macao accused of laundering money for the North Korean government, senior administration officials say the action has proved to be far more effective than anyone had dreamed.

Banks around the world are limiting their dealings with North Korea, and the nation's leadership is complaining with a vigor unusual even for that government.

"It really struck a nerve," a senior administration official said with a smile. It also has given new energy to those in the administration who have argued for years that the six-nation nuclear disarmament talks were a waste of time and that direct action was the only tactic that might force North Korea to give up its nuclear weapons program.

Since the Treasury Department ordered American banks to cut off relations with the Macao bank, Banco Delta Asia, on Sept. 15, the administration has repeatedly insisted that the law enforcement action was unrelated to the nuclear negotiations. Only now are officials saying that further law enforcement actions are planned, and their use has coalesced into a strategy.

In interviews, several present and former administration officials said the Bush administration had concluded that the six-nation talks intended to persuade North Korea to give up its nuclear arms were unlikely to succeed unless they were accompanied by these direct, punitive actions.

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