March 8, 2018 / 3:33 PM / 3 months ago

Australia probes company tied to illicit North Korea coal sale - U.N.

UNITED NATIONS/SYDNEY (Reuters) - Australian authorities are investigating a Sydney-based property company accused of breaching United Nations sanctions on North Korea by brokering an illicit sale of coal, according to a confidential U.N. report seen by Reuters.

Independent U.N. experts monitoring the implementation of sanctions accused Brigt Australia and its director, Livia Wang, of falsely stating that the shipment of coal had come from Russia when it had originated in North Korea, which has been subject to a U.N. Security Council ban on coal exports since Aug. 5, 2017.

Brigt Australia and Wang, which now trade in race horses, did not immediately respond to Reuters requests for comment.

The case against a company with no apparent experience in trading coal illustrates how U.N. experts say North Korea is using a network of foreign traders and front companies to evade tough international sanctions aimed at choking off funding for Pyongyang’s nuclear and ballistic missile programs.

It is also unusual for a company in Australia - a close U.S. ally - to be linked to North Korea trade. When Australian police arrested a man in December accused of trying to sell missile parts and coal for North Korea, it was described as a case “like nothing we have ever seen on Australian soil.”

The U.N. experts said in their annual report to the Security Council North Korea sanctions committee, which is due to be published this month, that the $770,250 coal shipment that Brigt Australia is accused of brokering “would constitute a violation of the resolutions, if confirmed.”

The Australian Federal Police, which probes breaches of U.N. sanctions, said it would not comment on investigations.

‘LEGIT IN THE HORSE WORLD’

The U.N. experts have reported that North Korea violated sanctions to earn nearly $200 million in 2017 from banned commodity exports, with many coal shipments using paperwork showing a false origin.

One page of a Sept. 15 contract, annexed to the U.N. experts report, is stamped with a Brigt Australia seal that includes the company’s Australian business registration number. A separate invoice, dated Sept. 25, lists the shipment as 11,850 tonnes of coal that was loaded at Nakhodka, Russia.

The invoice, stamped by Brigt Australia, says the coal was loaded on to the Panama-flagged vessel Hua Fu and destined for Vietnam’s Cam Pha port. However, the U.N. experts said: “Russia confirmed no port call.”

The United States has asked the Security Council North Korea sanctions committee to blacklist the Hua Fu, subjecting it to a global port ban and de-flagging. Washington told the committee the Hua Fu loaded coal at North Korea’s Najin port on Sept. 24.

According to documents filed with the Australian Securities and Investment Commission, Chinese-born Wang, 35, has been the director and secretary of Brigt Australia since April 2016.

A Brigt Australia website describes the company as “experienced in property investment.” Reuters visited the company’s Sydney office in an effort to seek comment.

An office administrator told Reuters the company’s primary business was race horses.

Race horse agent James Bester said Brigt had become a top Australian trader of young horses in the past two years.

“I know nothing about them other than they are perfectly legit in the horse world and are indeed very good payers, pay bills 100 percent on time,” said Bester, who helps the company buy and resell young horses.

Reporting by Michelle Nichols; Editing by Jonathan Oatis

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