Defectors detail North Korea Leader’s slush fund

Choi Kun-chol says he didn’t know he had spent several years helping to fill Kim Jong Il’s private slush fund until he left North Korea. Like the thousands of others working under the North Korean government division known as Office 39, Mr. Choi was told by superiors that he was generating money to build a strong socialist economy.

In fact, according to details that Mr. Choi gave about his work it was a shadowy network of businesses that contribute to a private fund believed to be worth billions of dollars for the use of the ruling Kim family.

Defectors say Office 39 was created during the 1970s by Kim Jong Il, the father of current leader Kim Jong Un, to buy influence in his own rise to power. Office 39 has been accused by the U.S. and others of running an array of illicit money-making operations such as currency counterfeiting, narcotics and arms sales. Some experts estimate the total annual income of Office 39 to be up to a couple of billion dollars a year.

High-level defectors, security officials and analysts say the fund still enables current ruler Kim Jong Un to underwrite comfortable lifestyles for the upper tier of North Korean society to ensure their support. Analysts and security officials say the execution of Kim Jong Un’s uncle, Jang Song Thaek, late last year may have been because Mr. Jang had interrupted the flow of funds to Office 39.

Office 39 also runs legal businesses under a state-owned shell corporation known as the Daesong Group, according to Mr. Choi and other defectors.

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