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Russia agrees to help transfer cash

Russia has accepted a request from Washington that a Russian bank help end a stalemate over frozen North Korean funds that has halted progress in the North's nuclear disarmament.

Moscow agreed to a US request that a Russian bank accept the North Korean funds via a US financial institution before they are moved to North Korea, South Korea's Yonhap news agency said yesterday, citing an unidentified South Korean government official.

North Korea has refused to move on its pledge to shut down its nuclear reactor until it receives US$25 million in funds that were frozen in a Macau bank.

The money has been freed for release, but North Korea has not withdrawn it, apparently seeking to prove the funds are now clean by receiving them through an electronic bank transfer.

But other banks have balked at touching the funds, which the US has alleged were tied to money laundering and counterfeiting by North Korea, throwing the disarmament process into limbo.

South Korean Foreign Ministry spokesman Cho Hee-yong said that close consultations were under way among parties involved in the disarmament talks on various ways to resolve the financial dispute, but he declined to confirm the Yonhap report.

The name of the US bank that would play the intermediary role would not be disclosed to help smooth the process, Yonhap said.
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