{"id":5131,"date":"2025-06-30T23:12:45","date_gmt":"2025-06-30T23:12:45","guid":{"rendered":"https:\/\/friscotimes.org\/?p=5131"},"modified":"2025-07-03T06:14:07","modified_gmt":"2025-07-03T06:14:07","slug":"north-korean-operatives-and-american-accomplices-accused-in-massive-fraud-that-infiltrated-the-fortune-500-and-stole-millions","status":"publish","type":"post","link":"https:\/\/friscotimes.org\/?p=5131","title":{"rendered":"North Korean operatives and American accomplices accused in massive fraud that infiltrated the Fortune 500 and stole millions"},"content":{"rendered":"\n

The Justice Department on Monday announced<\/a> a significant crackdown on the North Korean IT workers fraud scheme, with two new indictments naming more than a dozen alleged conspirators accused of stealing millions from at least 100 companies in the past four years.\u00a0<\/p>\n

\n

According to the first major indictment<\/a> from the District of Massachusetts, a crew of North Korean IT workers allegedly partnered with coconspirators in New York, New Jersey, California, and overseas to steal the identities of more than 80 U.S. people, get remote jobs at more than 100 companies\u2014many in the Fortune 500\u2014and steal at least $5 million. According to the second indictment<\/a>, a four-person team of North Korean IT workers allegedly traveled to the United Arab Emirates, where they used stolen identities to pose as remote IT workers, get jobs at American companies for themselves and unnamed coconspirators, and then systematically steal digital currency to fund North Korea\u2019s nuclear-weapons programs, authorities claimed in the five-count federal charging document<\/a>.\u00a0<\/p>\n

The indictments lay out in detail the way the IT worker scheme has leveled up from merely relying on fake and fabricated identities to a complex web of American-led front companies. The front companies are founded by paid accomplices and make it appear as though the IT workers are affiliated with legitimate U.S. businesses. The front-runners conceal the North Korean IT workers behind stolen American identities, and offer them U.S. addresses to take shipment of laptops sent out by companies for remote software jobs. The stolen revenue generated in the fraud scheme is allegedly transferred to North Korean leadership to help fund the authoritarian regime\u2019s weapons of mass destruction and ballistic-missile programs.\u00a0<\/p>\n

\u201cNorth Korea remains intent on funding its weapons programs by defrauding U.S. companies and exploiting American victims of identity theft, but the FBI is equally intent on disrupting this massive campaign and bringing its perpetrators to justice,\u201d assistant director Roman Rozhavsky of the FBI Counterintelligence Division said in a statement<\/a>. \u201cNorth Korean IT workers posing as U.S. citizens fraudulently obtained employment with American businesses so they could funnel hundreds of millions of dollars to North Korea\u2019s authoritarian regime. The FBI will do everything in our power to defend the homeland and protect Americans from being victimized by the North Korean government, and we ask all U.S. companies that employ remote workers to remain vigilant to this sophisticated threat.\u201d<\/p>\n

The authoritarian leadership of the Democratic People\u2019s Republic of Korea (DPRK) has deployed thousands of trained IT workers around the world to trick companies into hiring them for remote IT jobs, authorities said Monday. Once hired, the IT workers are tasked with making money and gathering intelligence to aid in cyber heists. In what\u2019s known colloquially<\/a> as the \u201cNorth Korean IT worker scheme,\u201d hundreds<\/a> of Fortune 500 and smaller tech companies have been battling back a tsunami of fake would-be job seekers who are actually trained North Korean IT workers. The UN has estimated the scheme<\/a> generates between $200 million to $600 million per year, not including the amount of crypto allegedly stolen in heists using intelligence gathered by the North Korean IT workers, which is in the billions.\u00a0<\/p>\n

U.S. Attorney Theodore S. Hertzberg told Fortune<\/em> in a statement that the DOJ is announcing the charges to help the public understand the risks presented by state-sponsored cybercriminals. Metro Atlanta is a tech hub home to numerous virtual currency businesses as well as the Georgia Institute of Technology<\/a>. Tech entrepreneurs need to be aware of the danger, and experts want to encourage public dialogue on ways to address the threat, said Hertzberg.<\/p>\n

\u201cThe virtual currency world values swift innovation and, in some circles, privacy and anonymity,\u201d said Hertzberg. \u201cIt is not uncommon for business owners to meet potential partners and employees online. But companies that work in this space would be wise to hire Americans and to thoroughly vet all potential employees and partners, preferably in person.\u201d<\/p>\n

According to the indictment, New Jersey man Zhenxing \u201cDanny\u201d Wang founded a software development company called Independent Lab as a front company in the scheme. Through Independent Lab, companies shipped laptops to Wang addressed to what the companies thought were hired IT workers, but in reality were people who\u2019d had their identities stolen. Wang allegedly hosted the laptops at his home, known as a \u201claptop farm,\u201d and installed remote-access software so the North Korean workers could access them from overseas locations. Wang also took in money paid as compensation from the U.S. companies and allegedly transferred it to accounts controlled by the overseas conspirators.\u00a0<\/p>\n

The indictment states multiple defendants and accomplices acted using front companies, including other unnamed conspirators in New York and California, plus an active-duty member of the U.S. military. The accomplices allegedly hosted laptop farms in their homes in exchange for hundreds of thousands of dollars in fees, authorities claimed.\u00a0The fronts allegedly defrauded at least four major companies, causing each one at least $100,000 in damages and lost wages. One accomplice alleged to be Kejia Wang, allegedly knew the workers were acting on behalf of North Korea.\u00a0<\/p>\n

In addition to Danny Wang, the government charged eight other defendants and claimed the fraud included a California-based defense contractor, from which an overseas actor allegedly stole sensitive documents related to U.S. military technology. Other companies impacted in the fraud scheme are located in California, Massachusetts, New York, New Jersey, Florida, New Mexico, Georgia, Maryland, North Carolina, Illinois, Ohio, South Carolina, Michigan, Texas, Indiana, Arkansas, Missouri, Tennessee, Minnesota, Rhode Island, Wisconsin, Oregon, Pennsylvania, Washington, Utah, Colorado, and the District of Columbia.\u00a0<\/p>\n

Michael \u201cBarni\u201d Barnhart<\/a>, principal risk investigator at security firm DTEX, said the arrests announced this week serve as a reminder that the threats from DPRK IT workers extend beyond just generating revenue.\u00a0<\/p>\n

\u201cOnce inside, they can conduct malicious activity from within trusted networks, posing serious risks to national security and companies worldwide,\u201d Barnhart told Fortune<\/em> in a statement. \u201cDPRK actors are increasingly utilizing front companies and trusted third parties to slip past traditional hiring safeguards, including observed instances of those in sensitive sectors like government and the defense industrial base.\u201d\u00a0<\/p>\n

Barnhart suggests the arrests underscore the notion that companies have to look beyond the typical applicant portals and reassess their entire talent pipelines given the way the DPRK IT worker threat has adapted.\u00a0<\/em><\/p>\n

\u201cThese schemes target and steal from U.S. companies and are designed to evade sanctions and fund the North Korean regime\u2019s illicit programs, including its weapons programs,\u201d Assistant Attorney General for the Department\u2019s National Security Division John A. Eisenberg said in a statement. \u201cThe Justice Department, along with our law enforcement, private sector, and international partners, will persistently pursue and dismantle these cyber-enabled revenue generation networks.\u201d<\/p>\n

The second indictment outlines how the four-man delegation used a mix of stolen identities and aliases to get two North Korean IT workers developer jobs at an Atlanta research and development tech firm, and at a separate virtual token company.\u00a0<\/p>\n

Together, the duo stole crypto valued at nearly $1 million, the U.S. Attorney\u2019s Office for the Northern District of Georgia alleged in an indictment handed down last week. The two IT workers then brought in others to help them allegedly launder the currency so they could disguise its origins before sending the money home to North Korean leadership.<\/p>\n

\u201cIt\u2019s not me!!!\u201d<\/h2>\n

As alleged in the second indictment, the scheme in this case began in October 2019 when four trained North Korean IT workers traveled to the United Arab Emirates using North Korean documents and set themselves up as a team. The crew methodically leveraged stolen identities blended with their own photos to pass muster as legitimate employees and gain access to sensitive information at the companies. The goal, according to the indictment, was to earn enough trust to get access to the virtual currencies the companies controlled so they could transfer them to the DPRK government, led by authoritarian dictator Kim Jong Un.\u00a0<\/p>\n

Once up and running, in December 2020 defendant Kim Kwang Jim allegedly gave an unnamed company a fake Portuguese ID that included a photo of Kim with the victim\u2019s actual birth date and government identification number. Kim allegedly used the stolen identity as an alias to get work developing source code at an unnamed U.S. company based in Atlanta. The indictment only names the stolen ID victim as \u201cP.S.\u201d and does not name any company that allegedly hired a North Korean IT worker.<\/p>\n

In March 2022, Kim allegedly modified the source code at the company where he had been hired. His changes altered the code for two smart contracts the company owned and controlled that lived on the Ethereum and Polygon blockchains. Kim triggered rule changes dictating when currency could be withdrawn from the company-controlled funding pools.<\/p>\n

Then on March 29 and March 30, 2022, Kim allegedly took 4 million Elixir tokens, 229,051 Matic tokens, and 110,846 Start. All told, the virtual currencies were worth about $740,000 at the time of the theft, according to the indictment. Kim allegedly transferred the currency to another currency address he controlled.\u00a0<\/p>\n

Authorities say Kim offered up a dog-ate-my-homework rationale to the founder to try to explain the currency transfer: \u201chi bro, really sorry \u2013 these weird txs started happening after i refactored my github.\u201d<\/p>\n

On March 30, the company founder sent a message on Telegram to Kim accusing him of stealing the virtual currency from the company\u2019s funding pools. Kim, using the Telegram account set up with the P.S. stolen identity, wrote back, \u201cHow many times do I need to tell you??? I didn\u2019t do it!!! It\u2019s not me!!!\u201d<\/p>\n

\u201cBryan Cho\u201d<\/h2>\n

Another alleged incident outlined in the indictment began in May 2021. Authorities say defendant Jong Pong Ju allegedly used the alias \u201cBryan Cho\u201d to get a job at another unnamed company to provide IT services.\u00a0<\/p>\n

After he was hired, Jong allegedly gained access to the company\u2019s virtual currency. Later that year, in October 2021, Jong allegedly used a Telegram account he had created using the Bryan Cho alias to recommend to the company founder that \u201cPeter Xiao\u201d would make a great developer. Authorities alleged Peter Xiao was actually another defendant, Chang Nam Il. The founder took Jong\u2019s recommendation and hired \u201cPeter Xiao\u201d to work on front-end development. Chang, working as Peter Xiao, allegedly worked at the company from October 2021 until January 2022.\u00a0<\/p>\n

In January 2022, the company founder asked for a video to verify the identity of \u201cBryan Cho\u201d\u2014who was actually Jong, authorities allege\u2014before giving Jong additional access to the company\u2019s crypto assets. On January 25, 2022, Jong allegedly used a Malaysian driver\u2019s license with the Bryan Cho alias to send a video to the founder over Telegram. The founder then allegedly gave Jong additional access.\u00a0<\/p>\n

The following month, Jong took that access and allegedly stole virtual currency tokens valued at approximately 60 Ether (worth $175,680 at the time) by transferring it to another virtual currency address that Jong controlled. Jong then used the Bryan Cho Telegram account to message the company founder, \u201cI think I accidently [sic] dropped the private key into the .env sample file.\u201d\u00a0<\/p>\n

The founder then asked where the \u201c.env file\u201d was uploaded, and Jong\u2014as Bryan Cho\u2014told him, \u201cGithub.\u201d<\/p>\n

\u201cThe defendants used fake and stolen personal identities to conceal their North Korean nationality, pose as remote IT workers, and exploit their victims\u2019 trust to steal hundreds of thousands of dollars,\u201d U.S. Attorney Theodore S. Hertzberg said in a statement. \u201cThis indictment highlights the unique threat North Korea poses to companies that hire remote IT workers and underscores our resolve to prosecute any actor, in the United States or abroad, who steals from Georgia businesses.\u201d<\/p>\n

That wasn\u2019t the end of it. From there, the North Korean IT workers allegedly needed to launder the stolen funds.\u00a0<\/p>\n

Chang, Jong, Kim, and a fourth defendant Kang Tae Bok allegedly used additional aliases and a virtual currency mixer known as \u201cTornado Cash\u201d to launder the stolen assets. Tornado Cash is a crypto mixer that essentially blurs the trail of crypto transactions.<\/p>\n

Authorities allege Kang used the alias \u201cWong Shao Onn\u201d to open an account at an unnamed virtual currency exchange using a doctored Malaysian ID with his own photo. Similarly, Chang used a faked Malaysian ID to open an account using the alias \u201cBong Chee Shen.\u201d<\/p>\n

Jong, after he allegedly stole the 60 Ether, sent the currency to Tornado Cash for mixing, the indictment states. Kim allegedly sent his stolen tokens to Tornado Cash also. The mixed funds were then withdrawn into accounts controlled by Kang and Chang, using the Wong and Bong aliases.\u00a0<\/p>\n

The FBI on Tuesday will release a new \u201cWanted\u201d poster in conjunction with the new indictments, a spokesman told Fortune<\/em>.<\/p>\n

Tornado Cash did not respond to a request for comment. Attempts to reach Wang were unsuccessful. <\/p>\n<\/div>\n\n","protected":false},"excerpt":{"rendered":"

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