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Global Insurance Fraud Floods N. Korea with Cash

North Korean leader profits personally from fires, disasters

By Jason Farago,  Newser Staff

Posted Jun 18, 2009 6:54 AM CDT
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(Newser) – North Korea has collected hundreds of millions of dollars from global insurance giants on often suspicious claims of fires, floods, and other disasters, according to a Washington Post investigation. While insurers have kept mum about their losses, US officials and Korean defectors describe a sophisticated fraud that has provided Kim Jong-il with cash, often for his personal use. "This is the gift that keeps on giving," said one State Department official.

Some details came to light when Allianz and other insurers sued over a 2005 helicopter crash. They claimed the crash was staged and that the North Korean court that upheld the claim was corrupt—but just as it reached trial the case was settled, in a near-complete victory for Pyongyang. One North Korean defector who worked in insurance gave a grim summary of the fraud: "Whenever there is a disaster, it becomes a source of hard currency."

North Korean military participants gather at a rally at the Kim Il Sung Square in Pyongyang, North Korea.
North Korean military participants gather at a rally at the Kim Il Sung Square in Pyongyang, North Korea.   (AP Photo/Korean Central News Agency via Korea News Service)
Kim Jong-il smiles as he inspects a factory in Tanchon city, South Hamgyong province, northeast of Pyongyang, North Korea.
Kim Jong-il smiles as he inspects a factory in Tanchon city, South Hamgyong province, northeast of Pyongyang, North Korea.   (AP Photo/Korean Central News Agency via Korea News Service)
A visitor looks at a collage made of pictures of North Korean leader Kim Jong-il at a unification observation post near the border village of Panmunjom.
A visitor looks at a collage made of pictures of North Korean leader Kim Jong-il at a unification observation post near the border village of Panmunjom.   (AP Photo/ Lee Jin-man)
North Korean participants gather at a rally at the Kim Il Sung Square in Pyongyang, North Korea, Monday, June 15, 2009.
North Korean participants gather at a rally at the Kim Il Sung Square in Pyongyang, North Korea, Monday, June 15, 2009.   (AP Photo/Kyodo News)
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COMMENTS
Showing 3 of 3 comments
Nwambe
Jun 18, 2009 12:39 PM CDT
For real? Are these people so poor they have to defraud insurance companies to get money? You're saying my insurance rates are high because of North Korea? This stinks of 1998, when we blamed El Niño for everything. Simply replace El Niño with North Korea, and you've got the same deal. That being said, I certainly wouldn't mind seeing the world converge on NK and blow its autocratic leadership into smithereens. I'l have a beer on my Muskoka chair and watch the fireworks, probably.
doingtherightthing
Jun 18, 2009 1:53 AM CDT
shonangreg..........do you know how to read? The poor never get. This is about Jong11 and his minions. Your getting screwed and you don't even know it. Fraud is fraud. Somebody pays in the end. You can bet the insurance companies pass the costs onto someone like you moron. You get the stupid award. Crawl back under your rock snake boy!
Corona_Kinq
Jun 18, 2009 1:03 AM CDT
Why are we insuring these douchebags anyway? Hey guess what? A psycho leader and a desperate nation might not be a safe entity to insure.

Recent brinkmanship may be a ploy for cash
Financial Times (UK)

 
North Korea • fraud • insurance • Kim Jong Il • insurance fraud

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