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Russia preparing to help N. Korea transfer funds from Macao -2

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Russia is preparing to help North Korea transfer its previously-frozen $25 million from a Macao bank, to encourage the Communist state to honor its nuclear commitments, a Finance Ministry source said Wednesday.
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MOSCOW, June 13 (RIA Novosti) - Russia is preparing to help North Korea transfer its previously-frozen $25 million from a Macao bank, to encourage the Communist state to honor its nuclear commitments, a Finance Ministry source said Wednesday.

"A transaction is being prepared, but a number of technical issues related to Russia's legal rights under international law need to be resolved," a source in the ministry said.

The source said further information will be made public as the problems are resolved.

The North Korean accounts held in Banco Delta Asia in Macao were frozen in September 2005 after the U.S. accused the regime of counterfeiting and money laundering. And although the accounts were unfrozen in March, after North Korea agreed to shut down its Yongbyon reactor the BDA was blacklisted making foreign banks wary of handling any further transactions.

The North has pledged that it will fulfill its February commitments with the five countries involved in a protracted nuclear dispute as soon as it receives the funds. Pyongyang boycotted disarmament talks for more than a year over the funds.

In October 2006 after North Korea conducted a nuclear test Japan completely halted imports from the republic and closed all its ports to North Korean ships.

The Asahi daily said Wednesday North Korea has withdrawn a portion of the $25 million frozen in the BDA. According to the paper, representatives from two North Korean companies made cash withdrawals of about one million Hong Kong dollars (about $125,000).

The paper quoted a banking source as saying that by June 11, the rest of the funds had been converted into U.S. dollars and transferred to a special account registered to the Korean Bank for Foreign Trade.

Russian Foreign Ministry spokesman Mikhail Kamynin said Russia was not against Russian banks organizing fund transfers from North Korean accounts in the BDA.

Kamynin said responding to reports in foreign-based media that Russia was ready to help transfer North Korean funds from the Macao-based bank, "As regards the reports mentioned, I can say the Russian side is interested in the soonest possible settlement to the problem, and is not against the possibility and feasibility of Russian banks participating in transferring funds to North Korea."

The Wall Street Journal said previously that funds from the BDA account will be moved to a Russian bank, the Far East Commercial Bank, later this week, to be subsequently returned to North Korea.

Russia said last Tuesday it could make a financial vehicle available for the transfer of North Korea's funds if Washington guarantees that no sanctions against Russia will follow.

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