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British American Tobacco Hid North Korea Business for Years: Feds

U.S. prosecutors have charged the company with helping Pyongyang skirt restrictions meant to freeze it out of the global banking system.

British American Tobacco (BAT) will pay a fine of $635 million, plus interest, for violating U.S. sanctions on North Korea, the company announced after a court appearance on Tuesday. Earlier in the day, federal prosecutors unsealed charges against BAT, accusing the multinational firm of helping Pyongyang skirt restrictions meant to freeze it out of the global banking system. In a charging document unsealed Tuesday, the feds accused BAT of structuring transactions with North Korean state-owned companies it partnered with “in order to obfuscate [its] sales to North Korea, and therefore caused U.S. financial institutions, including the U.S. banks, to process correspondent U.S. dollar transactions for [its] benefit. Had those financial institutions known the transactions originated in North Korea, they would not have processed those transfers.” BAT claimed it had pulled out of North Korea in 2007. However, U.S. prosecutors argued the company continued doing business with the so-called Hermit Kingdom until at least 2017.