Sean Williams
Appearances
The Jordan Harbinger Show
1154: Sean Williams | The North Korea-China-Drug Cartel Connection
I mean, that's more exciting than most boat tours I've ever taken.
The Jordan Harbinger Show
1154: Sean Williams | The North Korea-China-Drug Cartel Connection
Wow. Yeah. They don't do those fishermen on Discovery Channel shows, do they?
The Jordan Harbinger Show
1154: Sean Williams | The North Korea-China-Drug Cartel Connection
I once met a guy in Yangon who I think he was a Chinese national, but he was basically he got more and more drunk and told me that he was a gun runner and he was working in Dandong. So he must have been working on this like illicit arms trade that goes through there as well, which is another way that the Koreans make a lot of money.
The Jordan Harbinger Show
1154: Sean Williams | The North Korea-China-Drug Cartel Connection
Yeah, you're thinking of the Pongsu thing in 2003, where they found that freighter off the coast of Australia. I think it was flagged in Tuvalu, which is... I don't think Tuvalu has a particularly huge fleet. That's probably a big blue flag.
The Jordan Harbinger Show
1154: Sean Williams | The North Korea-China-Drug Cartel Connection
Yeah. Feels like a loophole they should have closed quite a while ago.
The Jordan Harbinger Show
1154: Sean Williams | The North Korea-China-Drug Cartel Connection
Yeah, multilateralism is not going so well at the moment. There's probably no chance of that happening. I think that 2003 incident, I think it was the Pongsu, they found over 125 kilos of heroin stashed in the hole. This was at a time, I think it was moored off the Victoria coast, so like Melbourne basically is one of the richest drug markets in the world. So that was all going there.
The Jordan Harbinger Show
1154: Sean Williams | The North Korea-China-Drug Cartel Connection
But even in 22 years since that happened, the whole drug industry has changed for North Korea. So they've got more into meth. I mean, who isn't into meth these days?
The Jordan Harbinger Show
1154: Sean Williams | The North Korea-China-Drug Cartel Connection
Yeah, I don't know.
The Jordan Harbinger Show
1154: Sean Williams | The North Korea-China-Drug Cartel Connection
Yeah, again, it's the 90s that change everything, right? So the 2003 Pongsu, that's the tail end of North Korea being deep into heroin because it's poppy fields. It's grown its own, basically. It's homegrown heroin and it was selling it on the international market.
The Jordan Harbinger Show
1154: Sean Williams | The North Korea-China-Drug Cartel Connection
Until the mid to late 90s, the famine hits, all of these poppy fields freeze over, and they kind of lose the entire industry from that point. They never get it back. So they do what is happening in the Golden Triangle, as I'm sure you know well, in the mid 90s, is they just switch to yaba, meth, crazy pills.
The Jordan Harbinger Show
1154: Sean Williams | The North Korea-China-Drug Cartel Connection
It's all the rage all over the Golden Triangle, especially in Burma, Myanmar, where it's getting made by the Wa, this crazy kind of ethnic Chinese tribe on the border with China.
The Jordan Harbinger Show
1154: Sean Williams | The North Korea-China-Drug Cartel Connection
Yeah, they are an interesting bunch. I've met a few of those guys. They're really nice, actually, because they don't give a crap. No one cares what they do in Myanmar. So they're under no threat whatsoever. So they just like chat to you openly.
The Jordan Harbinger Show
1154: Sean Williams | The North Korea-China-Drug Cartel Connection
Yeah, he knows better than anyone. He's such a great writer.
The Jordan Harbinger Show
1154: Sean Williams | The North Korea-China-Drug Cartel Connection
Yes, but in my sample size of about five guys, they're lovely.
The Jordan Harbinger Show
1154: Sean Williams | The North Korea-China-Drug Cartel Connection
Yeah, yeah.
The Jordan Harbinger Show
1154: Sean Williams | The North Korea-China-Drug Cartel Connection
But my head is still firmly attached, so I'm all right. But in the mid-90s, middle to late 90s, North Korea goes with the flow and it starts making meth. Obviously, it's way cheaper to produce. You can make it in factories if you've got the know-how. And if you've got the backing of an entire state that's willing to chuck a few mil at the industry, then you can do it overnight almost.
The Jordan Harbinger Show
1154: Sean Williams | The North Korea-China-Drug Cartel Connection
So meth starts becoming the drug of choice in North Korea and they start becoming a major sort of shipper of the drug around the region, especially over to Australasia and Southeast Asia. They become a big player in it. You get to the point now where meth has taken over in the North Korean state to such an extent that they've got a huge domestic consumption issue.
The Jordan Harbinger Show
1154: Sean Williams | The North Korea-China-Drug Cartel Connection
There's a bunch of stories came out late last year about it being more easier to get a wrap of meth than it is to get cigarettes or a loaf of bread or something like that, which is pretty grim. From what I've read and what I know about this, it's state-driven. There is a state-driven meth industry for domestic consumption as well as selling it overseas.
The Jordan Harbinger Show
1154: Sean Williams | The North Korea-China-Drug Cartel Connection
It's doubly disgusting to kind of poison your own people as well as incarcerate and send them out of the labor market. All of this horrible stuff. You would think with North Korea, surely it's going to all implode at some point soon, but It hasn't so far. I mean, it looks like it's getting even more bellicose between them and the South.
The Jordan Harbinger Show
1154: Sean Williams | The North Korea-China-Drug Cartel Connection
Yeah, slightly. Yeah. Slightly alarming. They're also big into moonshine as well, because I think alcohol is just far too expensive, and they make vodka, basically, out of spuds and other stuff. And we were talking about the stuff that the diplomats do, and I think one of the things I saw was that in Pakistan and Kuwait and some other dry countries...
The Jordan Harbinger Show
1154: Sean Williams | The North Korea-China-Drug Cartel Connection
North Korean diplomats have been selling whiskey and beer and other black market alcohol. So they're like, even if it's making them sort of 10 bucks, they're doing it. It's like any little helps the Kims. So it's a crazy place.
The Jordan Harbinger Show
1154: Sean Williams | The North Korea-China-Drug Cartel Connection
There's some Australian guy in Melbourne needs a new fix and he gets a text from his dealer. Meet me here. And he goes to the house and it's just got a North Korean flag flying out the top of it. You're like, oh, OK, this is weird.
The Jordan Harbinger Show
1154: Sean Williams | The North Korea-China-Drug Cartel Connection
And that's why you keep that backpacker motel open in Berlin, right? Letting them have some crappy hostel keeps them in the tent. Then, yeah, I guess you're going to just keep them in the city no matter what to find out what the hell they're doing.
The Jordan Harbinger Show
1154: Sean Williams | The North Korea-China-Drug Cartel Connection
Geez, what a life.
The Jordan Harbinger Show
1154: Sean Williams | The North Korea-China-Drug Cartel Connection
This is a cold place, right? I was doing an interview in January and just south of the North Korean border. It's like minus 12 degrees C. It's crazy cold. You're going to die if you're not inside. So maybe just being inside is the reason that you work. It's grim stuff.
The Jordan Harbinger Show
1154: Sean Williams | The North Korea-China-Drug Cartel Connection
Yeah. It's like when you drill down into it, there's not a lot below the surface in a way because it's just the Kim family and then a bunch of very benighted poor people around them that happen to be within the borders of a country called North Korea. And the way that it makes money, like you said, there's just so much illicit stuff that goes on.
The Jordan Harbinger Show
1154: Sean Williams | The North Korea-China-Drug Cartel Connection
And it pretty much has become the economy now, apart from some stuff going into China, which they're still kind of friends with. They just use their people as capital now to try and get foreign exchange, which is the gold dust for them. Going back all the way to the 60s and 70s when Kim Il-sung, the godfather of this mathia,
The Jordan Harbinger Show
1154: Sean Williams | The North Korea-China-Drug Cartel Connection
Yeah. If you don't work for us, you die. We're not going to pay you. We're not going to give you anything. You might live. You'll probably die anyway. But yeah, it's better to go with us. What a great offer.
The Jordan Harbinger Show
1154: Sean Williams | The North Korea-China-Drug Cartel Connection
Oh, man. Increasingly, all of this money is just going into making bombs that Kim can threaten everyone with so that he stays going for another, what, few months or a year until whenever his heart gives out. But it's not changing.
The Jordan Harbinger Show
1154: Sean Williams | The North Korea-China-Drug Cartel Connection
Yeah, I was going to say, like, sometimes my WhatsApp groups and my friends from home get a little bit meme-y and boring. But I guess if we all had to work in the fields for no money and we were dying, it'd be a little bit worse. So I don't have a lot to complain about.
The Jordan Harbinger Show
1154: Sean Williams | The North Korea-China-Drug Cartel Connection
I think they might be doing something less lubricant.
The Jordan Harbinger Show
1154: Sean Williams | The North Korea-China-Drug Cartel Connection
He basically ditches like the Soviets and ditches the Chinese and their views of communism. He's like, I'm going to go full out despot cult of personality. This is going to be a country that revolves literally around me and nothing else. And this is what we know as Juche's like cult of personality around the Kims and I guess a communist royal family, if that even sort of makes sense.
The Jordan Harbinger Show
1154: Sean Williams | The North Korea-China-Drug Cartel Connection
PPE. I think they did loads of that during COVID as well.
The Jordan Harbinger Show
1154: Sean Williams | The North Korea-China-Drug Cartel Connection
Yeah, I mean, the real bastards in this story are the Poles, right, who are doing it, because those are the kind of countries that you can control. You would think of being in the Western sphere or whatever you want to think of it. And they're taking slave laborers for 90 bucks a month. It's just that's the terrible part.
The Jordan Harbinger Show
1154: Sean Williams | The North Korea-China-Drug Cartel Connection
You can't really change a lot what happens in North Korea, but you can change that. You can change the demand for this kind of thing.
The Jordan Harbinger Show
1154: Sean Williams | The North Korea-China-Drug Cartel Connection
Yeah, I would assume they're Chinese, but I don't know. Like, where's the money coming from? Where's it going? I would assume that the Chinese have genuinely tried to crack down on that a bit because I think they have with the drugs as well. They did a big anti-drug drive in 2014-15, which is part of the fentanyl problem now.
The Jordan Harbinger Show
1154: Sean Williams | The North Korea-China-Drug Cartel Connection
They drove a lot of meth production out of China and I think they stamped out a lot of North Korean stuff. arranged marriages. It's just like a dark economy upon a dark economies. Where the hell is that money going? I have no idea.
The Jordan Harbinger Show
1154: Sean Williams | The North Korea-China-Drug Cartel Connection
Yeah, if it's a mafia, then this is the guys hanging out at the strip club in The Sopranos. These are the guys devising all the scams and schemes. They're going to get all this money. It goes back a long way. It goes back to the 70s again with Kim Il-sung. It's not new. And he's called Bureau 39 because it's in the ninth room of the third floor of the finance department in Pyongyang.
The Jordan Harbinger Show
1154: Sean Williams | The North Korea-China-Drug Cartel Connection
And it's supposed to maintain the various informal networks of money that keep the despots afloat. One of the most famous or infamous ones of this is this thing called the kipunjo, which is like the pleasure squat, which back in the day, Kim Il-sung had some pretty weird views about sex and women that veered into, I'm going to say problematic. That's the phrase that everyone uses now, right? Okay.
The Jordan Harbinger Show
1154: Sean Williams | The North Korea-China-Drug Cartel Connection
But he had basically, you know, sex was the fountain of youth. He just had this conveyor belt of young women coming through Bureau 39. It basically was a state brothel, but then it branched into other stuff like we've been talking about, dealing in weapons, dealing in drugs. One of the things is counterfeiting, which was a huge deal back in the 90s.
The Jordan Harbinger Show
1154: Sean Williams | The North Korea-China-Drug Cartel Connection
Still going forward now, these things called super dollars, which are counterfeit, usually $100 bills that are so good that they've actually caused a genuine dent in the value of the U.S. currency at various points in history.
The Jordan Harbinger Show
1154: Sean Williams | The North Korea-China-Drug Cartel Connection
I think there was one story where there was so much of it floating around parts of Africa at the time that US officials even thought about stopping runs on $100 bills at the mint. So these things are pretty hardcore. There's all other kinds of illicit that Bureau 39 does. It deals in ivory, wildlife trafficking, DVDs, Blu-rays, whatever you can think of as pirated.
The Jordan Harbinger Show
1154: Sean Williams | The North Korea-China-Drug Cartel Connection
Kids' toys, just crappy electronic devices, gold, cars, guns, grenades, whatever you can think of. It's like the nerve center of everything illegal that happens in the North Korean state. And then part of that, of course, is the cybercrime, right, which has become...
The Jordan Harbinger Show
1154: Sean Williams | The North Korea-China-Drug Cartel Connection
a huge earner, if not the biggest earner, bigger than the billion that they're getting from these poor people working in fields in the middle of nowhere.
The Jordan Harbinger Show
1154: Sean Williams | The North Korea-China-Drug Cartel Connection
What? Yeah. I'm king now. I've changed the rules. Yes. It's fine now. It's okay. And so like from the 70s onwards, he's just getting sanctioned to the hilt by the UN, by everyone. And the way that they figure out that they need to make money is by getting onto the black market.
The Jordan Harbinger Show
1154: Sean Williams | The North Korea-China-Drug Cartel Connection
Yep, that's exactly what's going on. Just big old bags of stuff in the diplomatic bags and cases going through the airports. You can't search them. That's how a lot of this stuff is being done. In a way, just use your entire diplomatic corps as a mafia who are working under threat of death and the deaths of their entire families. So it's a pretty well-oiled system.
The Jordan Harbinger Show
1154: Sean Williams | The North Korea-China-Drug Cartel Connection
But yeah, just about any illicit market that you can imagine in the world, North Korea is skimming some of it somewhere, whether it's old books or headphones or whatever. They're flogging on the black market. But the stuff that they've become world leaders in is cybercrime. There's a group called the Lazarus Group. I think some of your listeners probably would have heard of it before.
The Jordan Harbinger Show
1154: Sean Williams | The North Korea-China-Drug Cartel Connection
It basically started out as a sort of asymmetrical warfare group, which it still is to some extent. And I think it started in 2009, carried out a bunch of attacks. People might remember the WannaCry ransomware attack in 2017, ran into billions of dollars of damage. All of these hackers working out of Pyongyang, most of them trained in China. I remember
The Jordan Harbinger Show
1154: Sean Williams | The North Korea-China-Drug Cartel Connection
putting together a piece for The Economist back in 2012. And me and my co-writer figured out that some of these hackers have been using keyboards that would have initially been to the Korean alphabet. As the years go by, they realize they can also not just do attacks, but they can actually pwn a lot of people's money. They start doing smaller attacks. They start like malware, ransomware.
The Jordan Harbinger Show
1154: Sean Williams | The North Korea-China-Drug Cartel Connection
People who remember the internet when it was really good, when there were more than sort of four websites There were a bunch of getting a virus from some GeoCities website was an actual thing. And some of that was run by the North Korean regime. But then like in the last, what, 10 years or so, they've really ramped up these schemes to be serious financial crimes.
The Jordan Harbinger Show
1154: Sean Williams | The North Korea-China-Drug Cartel Connection
So your Bangladesh bank heist in 2016 is one of the biggest cyber crimes in history. They managed to basically convince people to trade a bunch of money, but it's being stolen by North Korea on the way.
The Jordan Harbinger Show
1154: Sean Williams | The North Korea-China-Drug Cartel Connection
And so one of the ways they do this is by dispatching hundreds of thousands of their own people abroad to work in what essentially are kind of labor camps in the worst form of the word. And most of them go to the Soviet Union at the time.
The Jordan Harbinger Show
1154: Sean Williams | The North Korea-China-Drug Cartel Connection
It's basically that they managed to imitate the trading systems of the bank. And I mean, the clue as to where the weaknesses were in the system are in the title of the heist. So Bangladesh wasn't using the most up-to-date security to run some of its systems. So basically what they did was they tried to ape the bank trying to trade a bunch of money. And
The Jordan Harbinger Show
1154: Sean Williams | The North Korea-China-Drug Cartel Connection
They would have actually gone away with nearly a billion dollars if it weren't for those pesky guys at the New York Federal Reserve. Because what they did was the hackers, in trying to mimic transfer, they actually misspelled one of the words. And that's what gave them away.
The Jordan Harbinger Show
1154: Sean Williams | The North Korea-China-Drug Cartel Connection
So as the money was pouring out, they were able to actually just shut the valve down because they're like, oh, OK, I don't think that's actually spelt like that. It's like proper Nigerian print scam style stuff.
The Jordan Harbinger Show
1154: Sean Williams | The North Korea-China-Drug Cartel Connection
No. That's a bad Monday.
The Jordan Harbinger Show
1154: Sean Williams | The North Korea-China-Drug Cartel Connection
I'm really not sure. I think that the key was that they mimicked the bank. And that the bank had sent some of the money before they realized they made a terrible error. But I think once you reroute some of that money, it is gone. And it goes into sort of dark bank accounts, probably in Switzerland. Everyone loves a Swiss bank account. And then it's disappeared. That's it.
The Jordan Harbinger Show
1154: Sean Williams | The North Korea-China-Drug Cartel Connection
That money's off the books. That's part of the reason that there is such a problem with dark money in the world. I think they're like one in eight dollars that's traded in the entire planet is part of the dark economy, shadow economy. So yeah, once it's gone, it's gone.
The Jordan Harbinger Show
1154: Sean Williams | The North Korea-China-Drug Cartel Connection
So they work in logging, which is the typical one out in the Russian Far East, which if people don't know, Russia is way big and it has a bunch of forests out in the middle of nowhere near Japan. which is crazy how huge Russia is. So the North Koreans use these false laborers, basically like nearly all of their wage goes back into the state and into the coffers of the dictatorship.
The Jordan Harbinger Show
1154: Sean Williams | The North Korea-China-Drug Cartel Connection
And so that continues. And then in the 1990s and the midnight 90s, especially a kind of like the breaking point for a lot of things in North Korea, you've got Kim Il-sung dies, his son, Kim Jong-il, who people know from team America and other funny things. Um, He basically leads the country through this insanely devastating famine. Crops fail. Many people die.
The Jordan Harbinger Show
1154: Sean Williams | The North Korea-China-Drug Cartel Connection
Yeah. The good thing about crypto is the blockchain, but the bad thing about crypto is the blockchain. The blockchain.
The Jordan Harbinger Show
1154: Sean Williams | The North Korea-China-Drug Cartel Connection
That's a hell of a lot of money. And it just shows you that I think when we talk about these groups, we think of it in the West as individuals and hacking groups and kind of bands of disparate people.
The Jordan Harbinger Show
1154: Sean Williams | The North Korea-China-Drug Cartel Connection
punky outfits trying to rip off people but out there and it's the same when you talk to people about Russian and Chinese misinformation groups these aren't just a couple of dozen people sitting in an office like typing out tweets although that is sometimes what they do this is extremely professionalized people working in North Korea's case probably 20 hours a day just trying to pull off that one heist
The Jordan Harbinger Show
1154: Sean Williams | The North Korea-China-Drug Cartel Connection
Smoking that meth. Smoking that domestic meth. Yeah, exactly. Jeez. Double shift, guys.
The Jordan Harbinger Show
1154: Sean Williams | The North Korea-China-Drug Cartel Connection
Yeah. Good luck catching him. I don't think he's going to be walking around Florida or California anytime soon, but I don't know. Maybe he wants to come over to the United States. Yeah. Then when you look at the back catalog of these guys, the ROI on this is unbelievable, right? In the case of the drugs or the labor, you've got to put in a hell of a lot of effort sending
The Jordan Harbinger Show
1154: Sean Williams | The North Korea-China-Drug Cartel Connection
Thousands and thousands of people into the world trying to get some money back. And like I just said, some of them are just selling bottles of whiskey to Pakistani diplomats. Whereas this is you making billions overnight potentially. So no wonder they're pouring all their funds into this.
The Jordan Harbinger Show
1154: Sean Williams | The North Korea-China-Drug Cartel Connection
I mean, it's only a country of what, like 24, 25 million people. And I think several million people die. And then they ramp up this illicit economy to try and just claw back anything like grain production. Absolutely anything they can get their hands on, they will. And that's when this illicit activity, including the labor stuff, just really goes crazy.
The Jordan Harbinger Show
1154: Sean Williams | The North Korea-China-Drug Cartel Connection
Yeah. And like on the attacking front as well, right? They downed parts of the NHS in the UK. It's one of the biggest systems in the whole world. They were just running on like Windows XP. So North Koreans hacked them, sent a bunch of stuff down. People missed their surgeries. People died. It's crazy the kind of chaos that you can cause.
The Jordan Harbinger Show
1154: Sean Williams | The North Korea-China-Drug Cartel Connection
It is actually like one of those crappy Hollywood movies they made in the 90s about Y2K. Like it's happening. It's just not quite as schlocky as that.
The Jordan Harbinger Show
1154: Sean Williams | The North Korea-China-Drug Cartel Connection
Yeah, Korea got flattened once before because of that. Why not do it again? It's crazy, like you're talking about the embarrassments of the Chinese and what the North Koreans are doing now, sending these troops into Ukraine as well. That must be terrible for their relationship with China.
The Jordan Harbinger Show
1154: Sean Williams | The North Korea-China-Drug Cartel Connection
The Chinese are doing stuff that is somewhat sophisticated, sending material, weapons and things like this to the Russians in the war. And then the North Koreans are sending these basically under-equipped slaves to fight on the front line who are getting captured and parading around in the media. That's not good for the Chinese. I mean, it's just terrible.
The Jordan Harbinger Show
1154: Sean Williams | The North Korea-China-Drug Cartel Connection
And so, like, today you even see North Korea has laborers. I think it's like... between 100,000 and 200,000 North Koreans working abroad these days. They're still in the logging camps out in the far east of Russia, all over the border. There's some people working in China. I think there was like a Vice documentary a few years ago where someone followed them all the way to western Poland.
The Jordan Harbinger Show
1154: Sean Williams | The North Korea-China-Drug Cartel Connection
China does not need to do this.
The Jordan Harbinger Show
1154: Sean Williams | The North Korea-China-Drug Cartel Connection
No. Not at all.
The Jordan Harbinger Show
1154: Sean Williams | The North Korea-China-Drug Cartel Connection
Yeah, I think that has happened in the past. People have flagged it up that places like Dandong being a good example where people are being forced into working factories. It's kind of part of the synergy between China and North Korea, right? When one needs money or the other needs labor, it seems to be a rule between the two that you can exchange the two pretty freely.
The Jordan Harbinger Show
1154: Sean Williams | The North Korea-China-Drug Cartel Connection
And there's plenty of factories and factories manufacturing centers in China where a lot of North Korean labor has shown up.
The Jordan Harbinger Show
1154: Sean Williams | The North Korea-China-Drug Cartel Connection
I think there's a place, I'm going to get the name wrong, but it's a really famous city in southern China, which I think they call it the world's largest small economic goods marketplace, which is basically when you think about when you go on Timu or Alibaba and you look at tripod for iPhone or USB port for this, it's all that kind of tiny electronic stuff. It's coming out of this one city.
The Jordan Harbinger Show
1154: Sean Williams | The North Korea-China-Drug Cartel Connection
I think it's called Yuwu. And there's a lot of North Korean labor in that city where they're building pretty cheap, pretty unsophisticated electronic equipment that just gets flooded onto Western markets. And I have heard of people working in mines and other really dirty industries as well. So yeah, it definitely does happen.
The Jordan Harbinger Show
1154: Sean Williams | The North Korea-China-Drug Cartel Connection
And I think it's probably going to continue to happen because that's the stuff that no one really in the West can do anything about, nor truly gives much of a crap about changing because...
The Jordan Harbinger Show
1154: Sean Williams | The North Korea-China-Drug Cartel Connection
China has become so powerful now, and there are all these flashpoints around the world where we're terrified of China kicking off in Taiwan or the Philippines or Europe or wherever, that we're not really going to bother the Chinese Communist Party if they are using forced labor from North Korea and propping up the regime there in their own borders. So it's just beyond anyone's purview.
The Jordan Harbinger Show
1154: Sean Williams | The North Korea-China-Drug Cartel Connection
It's the same thing in drugs. China went on this massive anti-drugs run because it realized all its people were getting addicted to meth. But all it did was push all of these ethnic Chinese gangs across the borders of its neighbors away.
The Jordan Harbinger Show
1154: Sean Williams | The North Korea-China-Drug Cartel Connection
And now you have gigantic gangs in Burma and Laos, wherever, producing maybe more drugs for international markets, which are causing even more chaos, even as far away as where I am in New Zealand. You've got stuff coming from the Golden Triangle now, and meth addiction is a real huge issue. It's always the incentives below the incentives with China.
The Jordan Harbinger Show
1154: Sean Williams | The North Korea-China-Drug Cartel Connection
I think there's always a top line, a headline of what we think China is incentivized to do, but below it, usually the reverse is true. And I think something else that we're going to talk about with money laundering as well, that is definitely the case with drugs and money laundering.
The Jordan Harbinger Show
1154: Sean Williams | The North Korea-China-Drug Cartel Connection
What a segue.
The Jordan Harbinger Show
1154: Sean Williams | The North Korea-China-Drug Cartel Connection
Feiqian, yeah.
The Jordan Harbinger Show
1154: Sean Williams | The North Korea-China-Drug Cartel Connection
It's like you say, Chinese people have been traveling the world for a hell of a long time. And this form of money laundering or mirror transactions, whatever you want to call it, people might know better by its Arab version, which is Hawala, which is networks of formal money networks. This has been going on. for around about 1,300, 1,400 years.
The Jordan Harbinger Show
1154: Sean Williams | The North Korea-China-Drug Cartel Connection
It starts out in the Tang Dynasty, around the 7th century, we think. Could be a bit earlier. But it's basically the invention of paper money. And some people consider flying money to be the first form of banknotes, essentially. So what would happen is... Chinese merchants would till the fields, do whatever they do and make a bunch of money.
The Jordan Harbinger Show
1154: Sean Williams | The North Korea-China-Drug Cartel Connection
It's all in coins, but you don't want to be carrying coins across a provincial border because there are bandits. And I don't want to be carrying coins across the provincial border today. No kidding. So what do you do? You get a note from the local treasury in your region saying, okay, he's got the funds. Like here's a note to prove it.
The Jordan Harbinger Show
1154: Sean Williams | The North Korea-China-Drug Cartel Connection
You take that note, you travel across the country, you give it to the other treasury. Okay. It's early banking, basically. It's a promissory note, very similar to what we even do today, basically. And so the money hasn't physically changed locations. It's still in a lockbox in Guy A's home back in Xi'an, but now he's picked up a bunch of money in Beijing.
The Jordan Harbinger Show
1154: Sean Williams | The North Korea-China-Drug Cartel Connection
And the transaction has taken place, but the money hasn't physically moved. And that's the key thing to remember with flying money or Feiqian. It's even to this day, it's almost impossible to detect because the money hasn't changed location. So you can't just check a bank's details.
The Jordan Harbinger Show
1154: Sean Williams | The North Korea-China-Drug Cartel Connection
You can't just see money going over a border where authorities would traditionally get a look in to see where money's going. So as Chinese merchants, they're not just traveling in China anymore. Say 12th, 13th, 14th century, you get great Chinese travelers who have been lost to Western history because we tend to focus on European settlers and colonists.
The Jordan Harbinger Show
1154: Sean Williams | The North Korea-China-Drug Cartel Connection
But that is when you get Chinatowns popping up all over the world. Incidentally, the first Chinatown in the world is in Manila in the Philippines. I did not know that. It's one of my favorite places on earth. It's so cool. But In these Chinatowns, obviously, then you'll get people wanting to remit money back home.
The Jordan Harbinger Show
1154: Sean Williams | The North Korea-China-Drug Cartel Connection
They're not going to use traditional systems where it's going to cost them a ton of money in commissions to financiers or bankers, whomever is existing at that time. So they're going to use flying money. So then this system goes global, right? This Fei Qian. And it works on the system of guanxi, which is an honor system. It's like a familial honor system. It's almost like an omerta in the mafia.
The Jordan Harbinger Show
1154: Sean Williams | The North Korea-China-Drug Cartel Connection
You don't snitch. You don't speak out. No one tells you where the money is except for the guys who do it. So this all dies down when Mao takes over and the People's Republic of China comes into existence in 1949, because obviously they want the state to be all powerful. They don't like these informal money lending or money remittance networks.
The Jordan Harbinger Show
1154: Sean Williams | The North Korea-China-Drug Cartel Connection
A lot of these informal Feixian networks that are profligating all around the world, they get shut down in favor of huge state institutions. But they carry on, obviously, because where there's money, there's going to be a way to move it. They kind of bubble around in the early years of communist China.
The Jordan Harbinger Show
1154: Sean Williams | The North Korea-China-Drug Cartel Connection
And then in 1978, when the economy opens up and Deng Xiaoping sends Chinese merchants again all over the world to try and get exchanged for the benefit of China. Then it kind of ramps up again. And so it's never gone away. It's always been incredibly popular. It's the thing that everyone knows but doesn't really talk about.
The Jordan Harbinger Show
1154: Sean Williams | The North Korea-China-Drug Cartel Connection
Even now, if you go on WeChat or any other Chinese social media network, you can type in flying money or you can type in money bank or transferer. You'll find hundreds, if not thousands of people popping up like all of these identities willing to do flying money transactions. And it's just not worth the government's time and investiture to get involved in this because everyone is using it, right?
The Jordan Harbinger Show
1154: Sean Williams | The North Korea-China-Drug Cartel Connection
Is the Greece that lets this informal money network prosper in China?
The Jordan Harbinger Show
1154: Sean Williams | The North Korea-China-Drug Cartel Connection
Thankfully, no.
The Jordan Harbinger Show
1154: Sean Williams | The North Korea-China-Drug Cartel Connection
There's stories that I heard from people who'd worked in Shanghai, Beijing, major international cities, and they're going into banks to try and send funds back to Europe or the US or wherever they're headquartered. And they've got people walking around the bank forecourt saying, would you like to save yourself an entire day and a lot of money by sending a flying money transaction with me?
The Jordan Harbinger Show
1154: Sean Williams | The North Korea-China-Drug Cartel Connection
And even the banks sometimes don't stand in the way of those guys because it's so prevalent.
The Jordan Harbinger Show
1154: Sean Williams | The North Korea-China-Drug Cartel Connection
You can do whatever you want. It was just crazy to me. When you hear the stories of the guys who defect from the North as well, like the way that they describe Juche or this cult of personalities, like there is no God, right? There are Kims. So you serve them and serving them is like a kind of semi-religious, just an incredible honor, right?
The Jordan Harbinger Show
1154: Sean Williams | The North Korea-China-Drug Cartel Connection
Yeah. To bring it up to where it is today, like the whole modern history of Feiqian is basically bumping up the system by a series of blunders or missed opportunities by the authorities, either in the US or China. I guess we're going to mostly talk about those two countries because we're talking about how cartels use them as well to sort of wash away
The Jordan Harbinger Show
1154: Sean Williams | The North Korea-China-Drug Cartel Connection
Yeah, it's fully insane. It comes into the public consciousness in the 90s, right? Because there's this famous case of a woman called Sister Ping, who's a so-called snakehead. She's like smuggling people into New York's Chinatown from Fujian in China. And she gets rumbled with one of her ship's grounds off the coast of Queens. And a bunch of people die and it's big news.
The Jordan Harbinger Show
1154: Sean Williams | The North Korea-China-Drug Cartel Connection
And it turns out that she's been using Fei Qian to get money to smuggle people illegally into the US. And it becomes like a news story for a short while. But in 2001, the World Trade Center is attacked. Then the U.S. focuses not on Chinese stuff, but on stuff coming out of the Middle East. Hawala Networks, which it believes are funding Al-Qaeda and whatnot, which they are.
The Jordan Harbinger Show
1154: Sean Williams | The North Korea-China-Drug Cartel Connection
And so flying money literally flies under the radar. And it gets another boost in 2007 when you like you say that the Chinese Communist Party is trying not to leak cash out of the country. So it slaps this $50,000 sort of personal limit on how much money you can transfer. And that kind of gives another incentive to use informal banking networks, right? Like you say.
The Jordan Harbinger Show
1154: Sean Williams | The North Korea-China-Drug Cartel Connection
It just gives the Feiqian networks another boost. You get to this point in 2010, 2015, when fentanyl is becoming a huge issue in the States, meth as well. The general power of the cartels to flood the U.S. with drugs is at an all-time high, whether it's coke, meth, or anything else. They realize at that point the Sinaloa cartel that's safe.
The Jordan Harbinger Show
1154: Sean Williams | The North Korea-China-Drug Cartel Connection
They don't have to use their friend in Panama City or Bogota anymore who's taking 15% to 20% off the top of every single money laundering deal that he's making. There's these Chinese guys. And by the way, the Chinese community in Mexico has been there a very long time, and they were instrumental. in early marijuana smuggling going back over 100 years. So they're very embedded.
The Jordan Harbinger Show
1154: Sean Williams | The North Korea-China-Drug Cartel Connection
And then the cartels realized, why are we doing it over here? We could just be using the Chinese and use them with their own system. You get this increasing synergy between the cartels and Chinese professional money launderers who are just rocking up in Mexico City and whatnot.
The Jordan Harbinger Show
1154: Sean Williams | The North Korea-China-Drug Cartel Connection
I spoke to some people for an article I wrote a couple months ago, and they said it could be a $2 trillion industry, Chinese money laundering alone. And with the amount of unknowns there are, this is all a shadow economy, right? It could be way more. The cartels are almost unilaterally using Chinese money laundering techniques now. There is no point using any other stuff.
The Jordan Harbinger Show
1154: Sean Williams | The North Korea-China-Drug Cartel Connection
So people are out there laboring in the worst conditions imaginable on Earth. And this guy with no protection, I mean, it must cost a dollar to protect him, but that's too much for the Polish woman. And they're doing it because there is a religious belief that the country is the Kims. I met a guy actually in Seoul a few months ago and he was a defector.
The Jordan Harbinger Show
1154: Sean Williams | The North Korea-China-Drug Cartel Connection
And like you say, they're just like pumping money into real estate in Canada. I think Vancouver, right, is like a huge place for this. Toronto is also massive. Sydney and Australia, I think they've got a big problem with this. I was in LA in November and there's that huge tower block in downtown LA. It got like shuttered and it's now covered in graffiti. Yeah, what is that?
The Jordan Harbinger Show
1154: Sean Williams | The North Korea-China-Drug Cartel Connection
Yeah, that is a Chinese money laundering story as well. I think a lot of that was bought with drugs. So it's like it's now become so big that it's visibly there in major cities.
The Jordan Harbinger Show
1154: Sean Williams | The North Korea-China-Drug Cartel Connection
It's like that thing in Caracas, right?
The Jordan Harbinger Show
1154: Sean Williams | The North Korea-China-Drug Cartel Connection
Yeah. And so this gets to the nub of what is going on. And this is why I'm saying that the incentives are all kind of skew with and back to front. So you would think I think it was talked about during the Biden years that like this is a great chance for cooperation with China. Right. Because on the face of it, we want to stop the fentanyl ODs.
The Jordan Harbinger Show
1154: Sean Williams | The North Korea-China-Drug Cartel Connection
China also wants to build a bridge, wants to try and help the states out in a sort of moralistic way, but it's pretty cheap to do for the Chinese. So it will be an easy diplomatic win. And for America, we can help the Chinese keep their economy afloat by stopping all that money coming out of the Chinese economy.
The Jordan Harbinger Show
1154: Sean Williams | The North Korea-China-Drug Cartel Connection
You've got Janet Yellen going over there and eating psychedelic mushrooms and going, hey, I'm best friends with the Chinese now, and we're going to help each other on money laundering laws because it helps both countries. And by the way, it stops terror networks, whatever the hell they mean by that. They're talking about Hawaii again. But...
The Jordan Harbinger Show
1154: Sean Williams | The North Korea-China-Drug Cartel Connection
Actually, when you dig below the surface of those incentives, they're the other way around because they can talk all the talk. But at the end of the day, the Chinese want chaos in the US and chaos is being caused by the cartels and drugs. And the Americans would like nothing more than for the Chinese economy to collapse and the CCP to go under. So it makes it even worse, right?
The Jordan Harbinger Show
1154: Sean Williams | The North Korea-China-Drug Cartel Connection
Because they're talking about and they're committing funds to not... busting it it's a weird dance the appearance is actually providing cover for it to become even bigger
The Jordan Harbinger Show
1154: Sean Williams | The North Korea-China-Drug Cartel Connection
That's way more.
The Jordan Harbinger Show
1154: Sean Williams | The North Korea-China-Drug Cartel Connection
Yeah, and every time that you have a kind of totalitarian state to whatever degree, if you're on the other side, if you're in the treasury or whatever in Washington, you can easily say this is state sanction just because everything in China ostensibly is state sanction, right? Because the state is all powerful. But like you say, the level of corruption in China is huge.
The Jordan Harbinger Show
1154: Sean Williams | The North Korea-China-Drug Cartel Connection
And the way that he described, he'd been pretty high up in the Politburo. He'd been a propagandist. Now he works at one of those radio stations that broadcast stuff across the border like Kim Jong-un's a dick, basically, over and over again.
The Jordan Harbinger Show
1154: Sean Williams | The North Korea-China-Drug Cartel Connection
They know full well that if they busted a bunch of these like flying money networks, the whole small economy, like mom and pop restaurants, whatever, they would collapse and then you would have a massive problem on your hands. They can't just go in and bust all of these guys. They have gone in and gone after some of the high level corruption in the financial institutions.
The Jordan Harbinger Show
1154: Sean Williams | The North Korea-China-Drug Cartel Connection
the Chinese but again the incentives don't really work it still makes money for the CCP I don't really see a way that they can stop it to be honest the problem is the drugs for Americans that's the bottleneck you want to get you can't really strangle the money transactions Yeah, well... Well, they're not even transactions.
The Jordan Harbinger Show
1154: Sean Williams | The North Korea-China-Drug Cartel Connection
Yeah. And there's like, what's the term? Like smurfing, I think they call it. You would get a bunch of Chinese students, all of whom can max out the 50 grand. Like you said, then you can take a million out of the country because you've got 20 students or whatever. And they don't know anything. They're just literally selling their limit. That's all they're doing.
The Jordan Harbinger Show
1154: Sean Williams | The North Korea-China-Drug Cartel Connection
Yeah. And the way that he described it was I didn't know that religion exists or anything like philosophy existed. There was one philosophy that was the Kims. And so anything you do, therefore, for them, no matter what you go through is good, including starvation and forced labor and trafficking drugs and whatever. I mean, I used to live in Berlin. I've lived in Berlin for many years.
The Jordan Harbinger Show
1154: Sean Williams | The North Korea-China-Drug Cartel Connection
They don't know anything about the stuff. You can't prosecute them. You can't prosecute the guys in China. It's almost impossible. You have to go for the cartels. You have to do the hard bit. Yeah.
The Jordan Harbinger Show
1154: Sean Williams | The North Korea-China-Drug Cartel Connection
Yeah, there was a great Politico piece from, I think, a couple years back about one guy who's a Mexican-Chinese national. And he had done some crazy stuff. And he was sitting on tens of millions of dollars that he was directly liaising with the Sinaloa cartel. Okay, he's gone down for a while. He's screwed. But... Beyond that, there's really not a lot that you can do.
The Jordan Harbinger Show
1154: Sean Williams | The North Korea-China-Drug Cartel Connection
And the good thing is, I guess, from an American's perspective, that fentanyl deaths are down a lot in the last year. So something is working either on harm reduction or strangling the supply at the border. But I think it's around 75,000 to 80,000 people dying per year from fentanyl IDs. And now, of course, it's not being made in China. It's being made locally.
The Jordan Harbinger Show
1154: Sean Williams | The North Korea-China-Drug Cartel Connection
in Mexico by the cartel was using precursors from China. That step of the process is being taken out of the game as well. It's not all bad news. There are some wins being made by law enforcement against the drug issue, but the money thing is going to continue going for God knows how long.
The Jordan Harbinger Show
1154: Sean Williams | The North Korea-China-Drug Cartel Connection
It's been a pleasure. Always nice to talk about the darker sides of the world.
The Jordan Harbinger Show
1154: Sean Williams | The North Korea-China-Drug Cartel Connection
And the North Korean embassy there was in the old east, obviously. And it ran a backpackers motel. So all these foreign backpackers coming through Berlin were heading to this like crappy motel in the middle of town. But it was run by the North Korean embassy and it was funneling foreign exchange straight back to Pyongyang.
The Jordan Harbinger Show
1154: Sean Williams | The North Korea-China-Drug Cartel Connection
Yeah. I don't know, to be honest. I should know. My partner's a diplomat. I should figure this out. But yeah, they do this all over the world. There's a bunch of North Korean restaurants all over the world. There's one in Dubai, I think, in Abu Dhabi. There's a Binta one in Dandong, China. They have all these crazy dance shows, traditional dance.
The Jordan Harbinger Show
1154: Sean Williams | The North Korea-China-Drug Cartel Connection
Female dancers doing these crazy dances in traditional dress. And that's funneling money back to the Kim. So it's quite an impressive racket. And it is just so global. And it's happened for so many years now. So entrenched. I think the Backpackers Hotel in Berlin was shut down in the end. And I think a few more have shut down.
The Jordan Harbinger Show
1154: Sean Williams | The North Korea-China-Drug Cartel Connection
A few of these restaurants and other businesses had shut down during COVID and they haven't popped up because I think countries that they're in realize, oh yeah, this is a good excuse to shoot this thing on without anyone really making a stink about it. But it's still up and running and there's far more naughty stuff happening than traditional dances and noodle soups.
The Jordan Harbinger Show
1154: Sean Williams | The North Korea-China-Drug Cartel Connection
Yeah, that makes sense. Is Dandong like a happening place? Is it like a... No. There's much going on?
The Jordan Harbinger Show
1154: Sean Williams | The North Korea-China-Drug Cartel Connection
Yeah, I don't think you're going to be like cleaning up graffiti on the side of a building for that. I think you're going to be in a bit of trouble.