Defectors offer stories of fake U.S. bills, but they don't check out

SEOUL, South Korea — A North Korean defector who claims to have helped the Kim Jong Il regime make fake U.S. currency has gone into hiding amid charges that he fabricated stories for money.

A second high-ranking defector who claimed he was in on the decision in Pyongyang to print bogus U.S. $100 bills admits that he never saw it being done.

If there are defectors with ironclad accounts to corroborate the Bush administration's assertions that North Korea is printing counterfeit U.S. $100 bills, they can't be found, even with vigorous effort.

One defector, who emerged in press accounts in late 2005 and early 2006 under the pseudonym "the chemist," has gone underground, leaving a wake of acquaintances who now say they don't trust anything he says.

That man, Kim Dong-shik, had told people since his defection in 2000 that he's a North Korean with a Ph.D. in chemistry who helped his country design fake U.S. currency.

But a human-rights researcher who spent a month living with Kim in December 2005 to determine whether he was credible "came to the conclusion that he was a liar."

"On the fake bills, I don't believe what he says," said Moon Kook-han of the North Korean Human Rights International Association, a small nonprofit group that works closely with U.S. activists on North Korea.

"I asked him which president is on a $100 bill. He didn't know. Moreover, I asked him to describe the building on the bill, and he said, 'I don't know,'" Moon said, referring to the likeness of Benjamin Franklin (who never served as president) on the front of the bill and Independence Hall in Philadelphia on the back.

"He said he was the chief designer of the bill. It doesn't make sense. If he were the chief designer, he would know all these details," Moon said.

A U.S.-based activist on North Korea, Sin-u Nam, an architect in North Bridge, N.J., said he met with Kim in Seoul and debriefed him at length on various issues, including counterfeiting, with an eye toward bringing him to testify on Capitol Hill.

But Nam said that while Kim seemed to know a lot about fake currency, his other allegations were unbelievable. "He lost credibility with me. I found him mentally unstable," Nam said.

Nam said he believes that Kim, like many North Korean defectors, made up stories to sell to journalists and foreign intelligence services. "He was expecting money," Nam said. Kim and other defectors "think the U.S. government will give them hundreds of thousands of dollars."

Kim, who's in his late 50s, moved out of his apartment in Seoul last year and reportedly is living secretly in coastal South Korea. A man who answered his mobile phone denied that he was Kim and hung up quickly.

"I guarantee that you cannot find him," said Kim Seong-min, a former North Korean army officer who now operates Free North Korea Radio in Seoul, which broadcasts across the border. Kim Seong-min, no relation, said the defector had become ensnarled in numerous fabrications and was trying to disappear. "He is a liar," Kim Seong-min said.

Another defector with supposed knowledge of counterfeiting is Kim Duk-hong, the second-highest ranking defector living in South Korea, who left the North in 1997. Kim Duk-hong (no relation to the other defector) was a member of the Korean Workers' Party Central Committee for 17 years and involved in high-level decision-making.

Kim Duk-hong said North Korea's leader ratcheted up the counterfeiting operation in the late 1970s and early 1980s to finance huge projects to glorify his father and to pay for his own profligate lifestyle, which included lavish weekend parties.

"He needed tons of money," Kim Duk-hong said. "The easiest way to make money is to print money. Counterfeiting became government policy."

In an interview with McClatchy, arranged by a researcher with ties to the South Korean military, Kim Duk-hong said the counterfeiting operations were conducted under the Organization Guidance Department and that money was laundered under Office 39, so named because it was set up on a March 9. The office gave traveling diplomats a mix of real and bogus U.S. dollars before trips and told them to transfer it to local banks.

Curiously, despite dozens of trips abroad, Kim Duk-hong maintained that he was never given any fake U.S. currency. He said he never learned details about how North Korea gained the know-how to make supernotes, nor did he ever witness counterfeiting operations.

Pressed on that point, Kim Duk-hong retorted: "In your country, would they let you into the mint?"

The answer is yes. The Bureau of Engraving and Printing offers daily tours in Washington from 9 a.m. until 2 p.m., and visitors can watch money being printed.

(Kevin G. Hall in Washington contributed.)

ON THE WEB

The U.S. Mint also offers tours, and an online virtual tour of the coin-making process.