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N. Korea bank account crisis over as first cash withdrawn -paper

Other News Materials 13 June 2007 12:43 (UTC +04:00)

( RIA Novosti ) - North Korea has withdrawn a portion of the $25 million frozen in accounts at the Macao-based Banco Delta Asia, the Asahi daily said Wednesday.

The North Korean accounts held in Banco Delta Asia in Macao were frozen in September 2005 at the request of the United States, which accused the Communist regime of counterfeiting and money laundering.

According to the paper, representatives of two North Korean companies came to the BDA and withdrew about one million Hong Kong dollars (about $125,000) in cash.

The paper quotes a banking source as saying that by June 11, the rest of the funds were converted into U.S. dollars and transferred to a special account registered to the Korean Bank for Foreign Trade.

The Wall Street Journal said previously that funds from the BDA account will be moved to a Russian bank, the Far East Commercial Bank, later this week, to be subsequently returned to North Korea.

Russia said last Tuesday it could make a financial vehicle available for the transfer of North Korea's funds if Washington guarantees that no sanctions against Russia will follow.

North Korea earlier accused the U.S. of foot dragging on Pyongyang's frozen $25 million, at a time when it was ready to denuclearize.

North Korea's $25 million in BDA was unfrozen in March in an attempt to win Pyongyang's promise to shut down its nuclear reactor. But the fund transfer was stalled when Washington blacklisted the bank, making other banks wary of handling Korean funds and dealing with the BDA. In response, the regime delayed shutting down its Yongbyon reactor, planned for April.

The North has pledged that it will fulfill its February commitments with the five countries involved in a protracted nuclear dispute as soon as it receives the funds.

The impoverished state has been cut off from global financial markets for several years and has used cash or complicated barter schemes to pay for supplies and services from other countries.

Pyongyang boycotted disarmament talks for more than a year over the funds and conducted its first nuclear bomb test in October 2006.

After North Korea's nuclear test in October 2006, Japan completely halted imports from the republic and closed all its ports to North Korean ships.

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