Russia is Now Actively Funding North Korea’s Nuclear Programme

For years following the first nuclear test by Pyongyang, the UN Panel of Experts on North Korean Sanctions provided hundreds of pages of open-source and investigation-based evidence into violations of UN Security Council Resolutions (UNSCRs) by North Korea while orchestrating its proliferation financing network worldwide. But in April 2024 the Russian Federation chose to withdraw its support from, or as another colleague put it, ‘gutted’, this UN-mandated body of experts.

In response, the UK, South Korea, the US and other allies created the so-called Multilateral Sanctions Monitoring Team or MSMT. This new body, aimed to replace the expertise lost with the UN Panel and produced its first report last month. Unsurprisingly, it has Moscow squarely in its crosshairs with the blunt title of its first batch of findings: Unlawful Military Cooperation including Arms Transfers between North Korea and Russia. This collaboration is, of course, an open secret, as the renewed alliance between the two countries has been in the media spotlight for a good two years already. Detractors of this initiative also argue that the MSMT lacks the UN’s legitimacy and the country members all represent decisively anti-Russian perspectives. It matters not – the evidence presented in the report is rock solid and the scale of violations truly daunting.

The key findings indicate that since 1 January 2024 Russia was involved in:

• Transfers of arms and related materiel via sea, air, and rail including shipments of artillery, ballistic missiles, and combat vehicles from the DPRK to Russia for use in Russia’s war against Ukraine and air defence systems from Russia to the DPRK.
• Training by Russian forces of North Korean troops deployed to Russia for direct support of Russia’s war against Ukraine.
• Supply of refined petroleum products to the DPRK that far exceed the yearly United Nations Security Council (UNSC)-mandated cap.
• Maintaining correspondent banking relations with the DPRK.

MSMT Shows Russia Abandoned its UN Commitments

As a permanent member of the UN Security Council the Russian Federation voted for measures against North Korea’s nuclear weapons programme starting with resolution 1718 (2006), which also created the Panel of Experts, and finishing with resolution 2397 (2017). As a country, it committed to upholding an international architecture of sanctions that resulted in almost every possible economic activity involving DPRK being classified as proliferation financing and banned under international law. North Korea remains to this date the most heavily sanctioned regime worldwide and is also a Financial Action Task Force blacklisted jurisdiction, indicating that the country is a pertinent danger to the international financial system.

In this context, the findings of the MSMT showcase what experts working in the field have known for months – Russia has turned from gamekeeper to poacher, becoming what, as a permanent member of the UN Security Council it had opposed via the North Korea sanctions regime for over a decade, a financier of nuclear proliferation.

For both parties it is a marriage of convenience, exemplified by the signing of DPRK-Russia Treaty on Comprehensive Strategic Partnership at the end of 2024. Russia sacrificed what little political credibility it still had as an international player to obtain men and material to sustain its war effort in Ukraine. North Korea on the other hand has now entered a binding relationship with a rogue and willing partner, providing desperately needed technology, commodities and most importantly cash, to sustain Pyongyang’s status as a nuclear power.

In Breach of FATF Standards

Russia has long been seen as a ‘jurisdiction of proliferation concern’. The MSMT report demonstrates how it is actively financing proliferation. This is in contravention of both UNSCRs and the standards of the Financial Action Task Force which, since 2012, has required all countries to undertake measures to counter proliferation financing (CPF). Put simply, this requires the implementation of financial safeguards to stop new nuclear weapons programmes from being launched and sustained, in contravention of UNSCRs. 

Of particular interest is the revelation that Russia has created a facility via which North Korea can access the international financial system. As part of the UN measures, Pyongyang has been cut off from SWIFT (the global financial messaging service) for many years, severely restricting DPRK’s cross-border financial activity. Now North Korean banks can clear their transactions using the Russian rouble via correspondent banks in both Russia and the illegally occupied Georgian province of South Ossetia – thus escaping isolation, something also underlined by a report from the FATF itself last week.

Jurisdictions Worldwide are at Risk from Russia’s Actions

Considering the findings of the MSMT, the international community’s exposure to proliferation financing has skyrocketed. All countries are required by the FATF to carry out national proliferation finance risk assessments. For some time now, these have revealed a heightened level of risk, not because of North Korean or Iranian links, but because of Russian individuals, companies, maritime vessels and other actors operating within their borders (see Jersey’s report for such a recent conclusion, particularly pages 9 and 12). 

The illicit financial activities of countries like North Korea employ networks of professional money launderers, fraudsters, criminal groups, smugglers, cyber criminals and scammers. The MSMT report makes clear that Russia now plays a fundamental part in this ecosystem. For those outside the G7 sanctions on Russia in response to its full-scale invasion of Ukraine, maintaining business as usual with Moscow is no longer an option if they want to shield themselves from complicity.

What Can Be Done to Mitigate Russia’s Proliferation Financing?

This first MSMT report serves as a stark reminder that we live in times when international norms are broken every day. Unfortunately, the knowledge that it brings to light is not a revelation – we knew this was happening. The international finance and security community and sanctions policymakers should use these findings as a basis for reforming the measures used to counter proliferation financing.

First, while this might not be easily achievable, the FATF should explore expanding its focus on CPF to cover ‘jurisdictions of proliferation concern’ specifically, by building in the requirement to consider secondary PF risk as part of the national risk assessment process.

Second, Ukraine’s allies applying sanctions on Russia should officially acknowledge the country as committing proliferation financing on behalf of North Korea and build in provisions to this effect into their sanctions regimes. This could result in additional considerations for jurisdictions that continue to trade with Russia.

In the international finance and security community, commitment to combatting proliferation financing has always been less prominent than addressing money laundering or terrorist financing, watered down in negotiations 15 years ago to merely implementing relevant UNSCRs. The UN’s ability to agree new sanctions in response to DPRK provocation has been frozen for nearly a decade, and Russia has dismantled the UN body responsible for monitoring DPRK’s proliferation activity. Put simply, the global effort to respond to proliferation financing is becalmed. But as revealed by the MSMT report, the landscape has changed drastically now Moscow has opted to openly flout its own commitments as a permanent member of the UN Security Council and support Pyongyang in its illicit crusade to become a nuclear power. With the FATF starting a new round of country evaluations, it is time to reenergise our commitment to identifying and disrupting the financing of proliferation.

© RUSI, 2025.

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