On September 26, 2016, Hong Kong Economic Journal and Radio Taiwan International published a news report based on South Korean Central Daily (JoongAng Daily) saying that China is investigating both North Korea Kwangson Banking Corp (KKBC) and Dandong Hongxiang Industrial Development Co. (DHID) for supporting North Korea’s nuclear program.
In March 2016, because of the sanctions of the United Nations in response to North Korea’s nuclear tests, North Korea Kwangson Banking closed its office in China. However, it continued operating underground in Dandong China, a border city close to North Korea. Kwangson Banking’s Dandong branch office is located on the 13th floor in the building of Dandong Hongxiang Industrial Development Company. The Dandong Hongxiang Group has secretly traded with Kwangson Banking, exporting materials related to nuclear development to North Korea.
After the U.S. and South Korea exposed the fact that the Hongxiang Group has exported nuclear materials to North Korea, China’s Foreign Ministry and the Liaoning Province Police announced that the Hongxiang Group has been involved in a number of serious economic crimes. In August 2016, the Chinese authorities arrested Ma Xiaohong, the owner of the Dandong Hongxiang Industrial Development Company and several other executives. Ma Xiaohong’s family members and over 20 officials who have helped Ma Xiaohong are all being investigated.
Sources: Hong Kong Economic Journal, September 26, 2016
Radio Taiwan International, September 26, 2016