US unseals indictment alleging 'staggering fraud' by North Koreans through illicit telework scheme

US unseals indictment alleging 'staggering fraud' by North Koreans through illicit telework scheme

Three North Korean workers and a U.S. citizen are charged in the indictment.

ByAlexander Mallin

May 16, 2024, 12:31 PM

    The Justice Department on Thursday unsealed an indictment charging three North Korean workers and a United States citizen with allegedly engaging in "staggering fraud" through a complex scheme where they secured illicit work with a number of U.S. companies and government agencies.

    The indictment against the North Korean IT workers -- using the aliases Jiho Han, Chunji Jin and Haoran Xu -- alleges the group used fraudulent identities belonging to 60 real Americans to secure telework positions between October 2020 and 2023 that ultimately generated nearly $7 million in profits for the Democratic People's Republic of Korea.

    Prosecutors further allege the group was assisted by U.S. national Christina Chapman in their efforts to obtain remote work positions, who they accuse of stationing laptops belonging to U.S. companies at various residences that the North Koreans were then able to access. She also allegedly received paychecks for the group and forged signatures of the intended beneficiaries in order to transfer the funds into her bank, later transferring the funds to the North Koreans while charging them monthly fees for her services, the indictment alleges.

    MORE: Biden asserts executive privilege over audio of interview with special counsel Hur

    "The conspiracy perpetrated a staggering fraud on a multitude of industries, at the expense of generally unknowing U.S. companies and persons," the indictment read. "It impacted more than 300 U.S. companies, compromised the identities of U.S. persons, caused false information to be conveyed to DHS [Department Of Homeland Security] on more than 100 occasions, created false tax liabilities for more than 35 U.S. persons, and resulted in at least $6.8 million of revenue for the overseas IT workers."

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    Included among the companies allegedly defrauded in the scheme are a "top-5 national television network and media company, a premier Silicon Valley technology company, an aerospace and defense manufacturer, an iconic American car manufacturer, a high-end retail chain, and one of the most recognizable media and entertainment companies in the world, all of which were Fortune 500 companies," according to the indictment.

    The workers also allegedly attempted to gain employment and access to information at two unnamed U.S. government agencies on three different occasions, according to the indictment, though those attempts were identified and thwarted.

    The State Department announced in a statement Thursday it is offering a reward of up to $5 million for information on the IT workers and the full-scale disruption of their scheme.

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