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BDA Fallout: When Neocons Attack...
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The neocons are emerging from their cubbyholes to defend their role in screwing up the Six Party Agreement.

David Asher, whose ostentatious self-promotion as leader of the State Department’s anti-North Korean efforts I have previously critiqued, pontificated on the significance of the BDA case from his new perch at the Heritage Foundation.

Yet for the officials who tracked North Korea’s illicit financial dealings and the progress of the law enforcement investigations in the United States, Banco Delta Asia had never been the main offender in Macao.

“The fact is that Banco Delta was an easy target in the sense that it was not so large that its failure would bring down the financial system,” said Asher, who is now a senior associate fellow with the Asian Studies Center of the Heritage Foundation.

In comparison with Banco Delta Asia, the information that had been collected on evidence of money laundering by the Macao branch of the Bank of China was “voluminous,” Asher said.

Asher insists that the move against Banco Delta Asia was the direct consequence of law enforcement efforts and was not designed as political leverage in talks that were taking place simultaneously with North Korea on nuclear disarmament.

He advocates that efforts to curtail North Korea’s links to criminal activity, and to ensure that China joins the enforcement effort, should not be suspended for the sake of expediency in the disarmament talks in Beijing.

“Banco Delta may be a sacrificial lamb in some people’s minds, but it is not about Banco Delta,” he said. “It’s about Macao, Macao’s government, China, the Chinese government and their complicity and their accommodative behavior toward North Korea’s illegal activities, proliferation activities and leadership financial activities.” (Donald Greenlees and David Lague, How a U.S. inquiry held up the N. Korea peace talks, International Heritage Tribune, April 11, 2007)

Hmmm. China China China.

Thanks, David, for confirming that we sought to implicate Bank of China in the BDA case in order to pressure China to come down harder on North Korea.

It’s a miracle the Six-Party Talks got as far as they did.

And it’s also no surprise that Treasury’s Daniel Glaser was summoned to Beijing March 24 and spent almost two weeks trying to deal with the fallout from whatwe now know was a direct threat to Bank of China.

Here’s what four years of investigations turned up:

According to briefings given in August 2005 by Justice Department officials, Smoking Dragon and Royal Charm produced 59 arrests as a result of more than four years of work involving the use of undercover agents who posed as members of a U.S. organized crime group.

The contraband seized by law enforcement agencies included about $4.5 million in counterfeit $100 bills, sometimes referred to as supernotes because they are so difficult to detect. Other seized items included millions of dollars of counterfeit cigarettes, Ecstasy pills and fake Viagra.

And the bad guys:

When it was over some 20 months ago, it produced dozens of arrests and hard evidence that Chinese criminal gangs had smuggled counterfeit U.S. currency, cigarettes and drugs made in North Korea into the United States.

David Asher bagged 59 Chinese gangsters passing some pills and $4.5 million in funny paper. As a bonus, he threatened Bank of China, one of the largest holders of U.S. government debt with a Patriot Act Section 311 prosecution.

Downside: North Korea pulled out of denuclearization talks to protest the freeze on BDA…

…and got the atomic bomb.

No wonder Asher feels compelled to step up and defend his nonsense.

Maybe someone will actually call him on it.

I’m waiting to see if the State Department will expend more political capital to save the Six Party Agreement—and the U.S. relationship with China–or just give up.

The neocons and the Chinese are no doubt watching too.

To compare and contrast, over the last three years—roughly the term of Asher’s crusade against North Korea–an estimated $8 billion was stolen or wasted by the government of Iraq, and the loot that didn’t end up in Swiss bank accounts was presumably funneled to the insurgents killing U.S. troops.


Of course, that’s all behind us now, isn’t it?

David Asher might have thought that threatening Beijing with total financial war was more important than engaging with North Korea and working with China, but Condi purged him from the State Department and the realists have their hands on the wheel now.


The Six Party Agreement is just rolling along, thanks to the Bush administration’s concession on the BDA accounts.

Or is it?

Moving from past to present, I guess one of the disadvantages of being a despised troglodyte dictatorship is that people get to print arrant nonsense about you in the newspapers:

North Korea had previously seized upon what U.S. officials called mere “technical problems” in transferring the money, through the Bank of China, to stall nuclear disarmament talks. (Choe Sang-hun, North Korea is ready to accept UN nuclear inspectors, International Herald Tribune, April 11, 2007)

Resolving the BDA funds issue by March 14 was supposed to be a confidence-building concession that would be followed by the North Koreans shutting down the Yongbyon reactor 30 days later.

The fact that it is now April 11 and the funds are still in BDA (no confirmation yet that any bank is willing to handle the funds) might lead inquiring minds to the conclusion that it is the United States and not North Korea that is “stalling the disarmament talks”.

But that is apparently not International Herald Tribune reporter Choe Sang-hun’s bent.

The whole thing would be laughable.

Unless we blame the North Koreans for not shutting down the reactor by April 14…and then blame them for the fact that we won’t agree to an extension.

But wait. Choe Sang-hun is on the case!

A potential failure to meet the Saturday deadline for switching off North Korea’s atomic reactor is the latest reminder of unpredictability in dealing with North Korea, and it is a setback for the Bush administration, which had hoped for quicker progress.

Actually, if you don’t do something you promised and blame the other side for it, that’s not “unpredictability”. That’s bad faith.

With reporting like this—and the neocons apparently regrouping to do battle—look for the political difficulties of the Six Party Agreement, and obstacles to extending the timeline in response to the BDA, to multiply in the weeks ahead.

(Republished from China Matters by permission of author or representative)
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