SINGAPORE - A district judge has convicted a Singapore-registered shipping company of transferring money that could reasonably have been used to contribute to the nuclear-related programmes or activities of North Korea.
Chinpo Shipping Company was also found guilty of running a remittance business without a valid licence between April 2, 2009 and July 3, 2013.
The company sent US$72,017 (S$101,630) from its Bank of China account to that of a shipping agent in Panama - C.B. Fenton and Co - on July 8, 2013 for the return passage of the MV Chong Chon Gang through the Panama Canal.
The transfer was a necessary payment for the transportation of the arms and related material from Cuba to North Korea.
The ship was managed by North Korean company Ocean Maritime Management (OMM), a longtime client of Chinpo, which is in the ship agencies and ship chandlers business and general wholesale trade.
Chinpo's director, Mr Tan Cheng Hoe, 82, is also director of its associated companies Tonghee Shipping Agency and Great Best Trading.
The offences came to light after investigation was carried out into the interdiction by Panama of the Chong Chon Gang, loaded with 25 containers and six trailers of arms and related material weighing 474 tonnes, in July 2013.
The cargo included two MiG-21 jet fighters, anti-tank rockets as well as SA-2 and SA-3 Russian surface-to-air missile systems and their parts. All were bound for North Korea and hidden in the cargo hold under 10,500 tonnes of sugar.
District Judge Jasvender Kaur said in her oral judgment that this constituted the largest amount of arms and related material interdicted to or from North Korea.
She said people who engage in financial related transactions must take some trouble to find out what the remittance is for, by asking for the documentation and information before acting on behalf in respect of such transaction.
"Accordingly, the prosecution does not have the legal burden of proving that the defendant company knowingly transferred the sum of US$72,016.76,'' she said.
The judge found that Chinpo conducted no due diligence of any kind before transferring funds on July 8, 2013 to CB Fenton.
Chinpo, the court heard, applied for a total of 605 outward remittances totalling US$40 million between 2009 and 2013 on behalf of the North Korean entities.
Chinpo said in its defence that it did not carry out the remittance transactions for the purpose of gain, that the remittances were incidental to its main business as a general and special agent for OMM and ship owners and thus, did not fulfil the requirement of a "business''.
But Judge Kaur disagreed that the remittance business must be the core business in order to come within the scope of the section.
The case was adjourned to Jan 29 for Deputy Public Prosecutor Ang Feng Qian to make her submission on sentence and mitigation by defence lawyer Edmond Pereira.
The maximum punishment for violating Regulation 12(b) of the United Nations (Sanctions - Democratic People's Republic of Korea) Regulations 2010 is a $100,000 fine and five years' jail.
