Category Archives: South Korea

(WP) North Korean hackers stole U.S. and South Korean wartime plans, Seoul lawmaker says


North Korea’s leader, Kim Jong Un, inspects artillery launchers in April. (Kcna/Reuters)
 October 10

 North Korean hackers stole a huge trove of classified U.S. and South Korean military documents last year, including a plan to “decapitate” the leadership in Pyongyang in the event of war, a lawmaker in Seoul said Tuesday.

The purported revelations come at a time of heightened tensions over North Korea. President Trump recently said that “only one thing will work” when it comes to Pyongyang, hinting that he thinks diplomatic efforts are proving futile and military action may be necessary.

The defense minister in Japan, a close military ally of the United States, said Tuesday that Trump might take such action against North Korea as soon as next month.

“I think President Trump will judge in the middle of November how effective pressure and other efforts have been,” Itsunori Onodera told reporters in Tokyo. “If there have been no changes from North Korea, it’s possible that the U.S. will take severe measures.”

On Tuesday, Trump was briefed on the options on North Korea by Defense Secretary Jim Mattis and the chairman of the Joint Chiefs of Staff, Gen. Joseph F. Dunford Jr., the White House said.

Why does North Korea hate the U.S.? Look to the Korean War.
Everyday, North Koreans are told that the Americans are “imperialists” and North Korean children are taught that “cunning American wolves” want to kill them. To understand why, we need to go back to the Korean War. (Anna Fifield, Jason Aldag/The Washington Post)

In Seoul, Lee Cheol-hee, a lawmaker in the ruling Democratic Party and a member of the parliamentary national defense committee, said North Korean hackers broke into the Defense Integrated Data Center in September last year to steal secret files, including American and South Korean “operational plans” for wartime action. The data center is the main headquarters of South Korea’s defense network.

According to Lee, the stolen documents included OPLAN 5015, a plan drafted two years ago for dealing with full-blown war with North Korea and said to include procedures to “decapitate” the North Korean leadership. He said the cache also included OPLAN 3100, outlining the military response to infiltration by North Korean commandos or another local provocation, as well as a contingency plan in case of a sudden change in North Korea.

Pentagon spokesman Army Col. Robert Manning said Tuesday he was aware of media reports of the breach but would not say whether sensitive operation documents were exposed.

“We are confident in the security of our operations plans,” Manning said.

While the two Koreas have technically been on a war footing since the Korean War ended in an armistice in 1953, anything that suggests the death or ouster of North Korea’s leader, or his assassination, is tantamount to heresy in the North, where the ruling Kims are treated like gods.

Responding to reports about the plans for decapitation strikes, the North’s Korean People’s Army said in March that it would “deal deadly blows without prior warning” to “the U.S. and South Korean puppet forces.”

Here’s what you need to know about what cyberweapons are and when they have been used in the past. (Dani Player, Sarah Parnass/The Washington Post)

“They should think twice about the catastrophic consequences to be entailed by their outrageous military actions,” the army’s general staff said, according to a state news report.

Lee made his claims about the alleged cyberattack to South Korean reporters, citing documents obtained from the Defense Ministry under a freedom of information request. Lee’s aides told The Washington Post on Tuesday that the lawmaker had collected information from several sources with knowledge of the cyberattacks, and they confirmed that local media had correctly reported Lee’s remarks.

Yonhap News Agency, citing Lee, reported that the hackers took 235 gigabytes of military documents and that almost 80 percent of the stolen documents have not yet been identified.

The documents also included reports on key South Korean and U.S. military personnel, the minutes of meetings about South Korean-U.S. military drills, and data on military installations and power plants in South Korea, reported the Chosun Ilbo, South Korea’s largest newspaper.

“I can’t reveal further details because they are a military secret,” Lee said, according to the paper.

The U.S. and South Korean militaries have a mutual defense pact under which the U.S. military would assume operational control of the alliance if a war breaks out. The two militaries conduct large-scale drills twice a year, rehearsing the responses to various scenarios on the Korean Peninsula.

As Kim Jong Un has accelerated his nuclear weapons program and aimed increasingly bellicose threats at the allies, those plans have been updated to include “beheading operations” — strikes designed to take out North Korea’s leaders.

South Korea’s Defense Ministry declined to confirm or comment on the reports of a cyberattack.

South Korean lawmakers have a spotty record when it comes to revealing information about what is happening inside North Korea, with many claims later turning out to be wrong. But in this case, the claims relate to something that has happened inside South Korea, and there have been hints about such a cyberattack in recent months.

In May, the Defense Ministry disclosed that the South Korean military’s intranet had been hacked by people “presumed to be North Koreans.” But the military said that only 53 gigabytes of information were stolen, and it did not reveal what was included.

The previous month, reports emerged that North Korean hackers had broken into the Defense Ministry network and infected more than 3,000 computers, including the defense minister’s, with malware.

At the time, South Korean newspapers, quoting unnamed government officials, reported that parts of one operational plan, OPLAN 5027, which outlines troop deployment plans and key North Korean targets, were stolen.

Current and former U.S. officials have said the United States also must be more proactive in launching and openly discussing cyberoffensives and retaliations. In May, retired Navy Adm. James Stavridis, the former commander of NATO forces, told lawmakers “we should advertise them accordingly” to demonstrate ability and resolve.

North Korea was potentially behind phony evacuation messages sent via cellphones and social media to military families and defense personnel in South Korea last month. That incident opens the possibility that last year’s breach may have led to the harvest of personal information used for the notifications.

This is hardly the first time that Kim’s regime has been accused of cyberattacks. The country’s spy agency, the Reconnaissance General Bureau, is thought to have assembled a large cyber army, assumed to be based in China, to launch such hacks.

North Korea was allegedly behind many attacks on South Korea’s financial networks and government systems and was blamed for the hacking of Sony Pictures Entertainment in 2014, apparently as retaliation for the movie “The Interview,” which culminates with Kim’s death in an explosion.

Most recently, North Korea was accused of being behind a cyberattack last year on Bangladesh’s central bank that netted $81 million and of masterminding the WannaCry ransomware that rocketed around the world earlier this year.

The latest alleged cyberattack comes as the United States struggles to harden cyber defenses against adversaries such as Russia, China and North Korea, who have outpaced U.S. efforts to fold cyber weapons into conventional military operations.

The Army said in a manual released Monday that it will seek to put greater emphasis on cyber options in what it calls hybrid war — a blurring of cyber and space operations with traditional military actions like mobilizing ground troops and massing tank units.

Yoonjung Seo in Seoul and Alex Horton in Washington contributed to this report.

(Economist) North Korea’s nuclear test has left the South wanting nukes too

(Economist) It may settle for more powerful conventional arms instead.

THE runaway pace of North Korea’s nuclear development has confounded predictions and diverted the attention of world leaders. It is also meddling with one North Korean grandmother’s retirement plans. Ri Chun Hee, a veteran broadcaster at Korean Central Television, was promised a rest in 2012, after 41 years gleefully reading out propaganda. The 74-year-old would only return for significant announcements. Yet these now come most weeks. North Korea has already tested 22 missiles this year. On September 3rd Mrs Ri was back, claiming the regime had tested a hydrogen bomb (see article). It was, she declared with trademark exuberance, the “perfect” explosion.

Mrs Ri is not the only cold war relic that could be put back into service as a result of the test. Some South Koreans want America to show its support by moving nuclear weapons back to their country. The White House put 950 of them there after the Korean war, but withdrew them in 1991. Soon afterwards both Koreas agreed to keep nuclear weapons off the peninsula. But the North has long flouted the deal, testing its first bomb 11 years ago. Liberty Korea, the South’s biggest opposition party, called in August for the weapons to be redeployed. Hong Joon-pyo, its leader, reiterated the demand two days after the latest test.

South Koreans are growing less certain that they can entrust their security to America. A poll by the Pew Research Centre in June found that 78% of South Koreans have no confidence in Donald Trump to “do the right thing” in world affairs. His response to the latest test will have done little to assuage these fears. James Mattis, his defence secretary, warned Mr Kim that a threat to America or its allies would prompt “a massive military response”. But Mr Trump, who had earlier mused about ditching a free-trade agreement with South Korea, chose instead to criticise Moon Jae-in, the South’s president, who has called for talks with the North. “South Korea is finding, as I have told them, that their talk of appeasement with North Korea will not work,” he tweeted. For Mark Fitzpatrick of the International Institute for Strategic Studies, a think-tank, “that was exactly the wrong response.”

Not fickle, but fissile

Mr Hong argues that redeploying nuclear weapons would be proof of America’s will to defend the South. Several conservative newspapers have endorsed the notion. One big one, Joongang Ilbo, said the move would “raise our trust in the United States”. A poll in August found that only 27% of South Koreans favour keeping their country nuclear-free. On September 4th Song Young-moo, the defence minister, said asking for the weapons was “one alternative” that should be reviewed. He mentioned public demand for the idea in a recent meeting with Mr Mattis.

Another option is for South Korea to acquire its own nuclear weapons. It tried this twice in the 1970s but was pressed by America to stop. Experts believe it could have its own bomb within three years if it chose to do so. Most South Koreans have been keen on the idea for two decades. Another paper, Chosun Ilbo, said the government must consider it: “A nuclear threat must be met with a nuclear deterrent. There is no other option.”

Yet South Korea will probably remain nuclear-free. Making its own bombs could jeopardise the alliance with America and risk sanctions for violating the nuclear non-proliferation treaty of 1968. Mr Moon and his party continue to oppose asking the Americans for some of theirs. Even if they change their minds, American generals are unlikely to back such a scheme.

America has plenty of nuclear weapons capable of striking the North—from submarines, bases on Guam or even the American mainland. Putting them in the South would antagonise China and Russia just as America is trying to enlist their help to press the North to abandon its drive for long-range nuclear weapons. This week at the United Nations, America circulated a resolution that would bar exports of oil to North Korea, most of which come from China, and which is the one plausible means left to rein in the North. “From an American perspective, it [deploying nuclear weapons in the South] is unnecessary and dangerous,” says David Straub, a former American diplomat now at the Sejong Institute, another think-tank.

Mr Moon is far more likely to boost conventional defences. He has reversed his earlier opposition to THAAD, an American anti-missile system. Four more launchers were installed soon after the latest test. Mr Moon has also persuaded Mr Trump to lift a limit on the range and payload of its (non-nuclear) missiles, allowing the South’s army to deploy more powerful ones, eg, able to destroy bunkers.

“Kim Jong Un must not be allowed to sleep easy,” cried Chosun Ilbo, referring to the North’s leader. Mr Moon hopes to persuade South Koreans that they, at any rate, still can. That should be relatively easy. By mid-week a qualifying match for the football World Cup had bumped North Korea from the top three search terms on Naver, South Korea’s answer to Google. Passers-by in Gwanghwamun, a square in the centre of Seoul, were not fretting about an imminent apocalypse. Asked to judge the current atmosphere in the capital, a middle-aged man replied, “The pollution isn’t as bad these days.”

+++ (BBG) Moon Seeks Putin Help, Warns of ‘Uncontrollable’ North Korea

(BBG) U.S. President Donald Trump and Chinese President Xi Jinping spoke again about how to resolve the North Korean crisis as the U.S. seeks support for more stringent UN sanctions at a Security Council meeting next week.

“We will not be putting up with what’s happening in North Korea,” Trump told reporters Wednesday after the conversation. The two leaders had a “very, very frank and very strong call,” he added. Asked about possible U.S. military action, the president said, “That’s not our first choice, but we’ll see what happens.”

Xi reiterated China’s commitment to a denuclearized Korean peninsula while Trump emphasized Beijing’s role in influencing Kim, according to a summary of the call published in Chinese state-run media. The report didn’t say any breakthrough was achieved ahead of a Security Council session the U.S. has requested for Sept. 11.

The call between the U.S. and Chinese leaders came after Russian President Vladimir Putin earlier in the day expressed concern that halting oil supplies to North Korea would hurt its people. Putin’s comments followed a request from South Korean President Moon Jae-in that he support more stringent United Nations sanctions.

“Stopping oil supply to North Korea is inevitable,” Moon’s spokesman Yoon Young-chan quoted him as saying. “I’m asking for Russia’s cooperation.”

Putin explained at length to Moon that sanctions won’t work on North Korea and that halting its oil supply would damage hospitals, his foreign policy aide Yuri Ushakov said after the meeting, echoing the Russian leader’s earlier remarks that such action would be “useless and ineffective.” On Tuesday, Putin told reporters that Russia’s trade with North Korea is “almost zero,” and that its quarterly exports of 40,000 tons of oil to the country are “as good as nothing” relative to its global sales.

Even so, Ushakov said the talks had led to more “elements of commonality.”

The two leaders’ interaction raises questions over how far the Security Council will go in punishing Kim Jong Un’s regime after it conducted its sixth and most powerful nuclear test on Sunday. Russia and China both hold vetoes and have opposed doing anything that could lead to the collapse of Kim’s regime.

Trump has vowed to escalate sanctions also has warned North Korea of “fire and fury” if it continues threatening America. He has also threatened to cut off trade with all countries that do business with North Korea. China is North Korea’s biggest trading partner.

Markets React

Stocks fell in most Asian markets on Wednesday, and almost every sector of the Stoxx Europe 600 Index retreated, as nations grapple with how to deal with North Korea’s escalating provocations. The yen was near its strongest level for the year.

In a conversation with Putin on Monday, Moon had said it was time for the UN to seriously consider blocking North Korea’s foreign currency sources by cutting off crude oil supplies and banning its overseas labor.

‘Uncontrollable Situation’

“If we fail to stop North Korea’s provocations now, it could sink into an uncontrollable situation,” Moon said in remarks before the meeting with Putin. “I want to seek a fundamental solution to resolve the North Korea nuclear problem here.”

Putin called for all sides to calm down.

“There’s no point in giving into emotions and backing North Korea into a corner,” Putin said. “More than ever now we need to show restraint and avoid any steps that could escalate tensions.”

“They’ll eat grass, but they won’t abandon their program unless they feel secure,” Putin told reporters Tuesday at an emerging markets summit in Xiamen, China, which was hosted by Xi.

North Korea has reportedly been preparing another launch of an intercontinental ballistic missile that could come before it marks the anniversary of its founding on Sept. 9. Kim claimed on Sunday that he could fit a warhead onto an ICBM capable of striking the continental U.S.

Japanese Prime Minister Shinzo Abe also plans to visit Vladivostok for talks with Moon and Putin. He told reporters in Tokyo on Wednesday that he wants North Korea to understand it has “no bright future” if it continues on its current path. Putin’s foreign policy aide Ushakov expressed hope that progress could be made at the talks.

Border Post

China has been considering closing a customs post along its border with North Korea, according to the Daily NK, a Seoul-based website that says it gathers information from informants inside the isolated nation. The Quanhe customs house in Yanbian Korean Autonomous Prefecture, near the Russian border, is the second-biggest of nine posts between China and North Korea.

South Korea is watching closely for any radiation leaks after North Korea detonated its nuclear device, Unification Ministry spokesman Baik Tae-hyun said in a briefing Wednesday. The nation’s nuclear safety commission said it hadn’t detected any so far.

Additional launchers for the U.S. missile shield known as Thaad will be installed in South Korea on Thursday afternoon, Yonhap News reported, citing activists at the site. Moon had previously sought to delay its deployment.

The deployment of Thaad “does not help addressing the security concerns of relevant countries,” Geng Shuang, a spokesman for China’s foreign ministry, said at a briefing in Beijing on Wednesday. “It will only severely undermine the strategic balance in the region, jeopardize strategic and security interests of the regional countries, including China, aggravate the tension and confrontation, and further complicate the Peninsular issue.”

Weapons in Japan?

In Tokyo, ruling party heavyweight Shigeru Ishiba said Wednesday on a TV show that Japan should review its policy of not allowing the U.S. to bring atomic weapons into its territory, according to Kyodo News. This would strengthen the deterrence provided by the alliance with the U.S. in the face of the North Korean threat, the lawmaker said.

After Ishiba’s remarks, Japan’s top government spokesman Yoshihide Suga said that Japan would retain its nuclear weapons ban. He said earlier Japan was also gathering information on North Korea’s electromagnetic pulse attack development.

Hours after detonating the device, North Korea’s state-run news agency called it a “thermonuclear nuke with great destructive power which can be detonated even at high altitudes for super-powerful EMP attack according to strategic goals.”

Japan’s Defense Minister Itsunori Onodera said that the explosion on Sunday was 10 times more powerful than the bomb that devastated Hiroshima in the final days of World War II.

+++ V.I. (BBG) South Korea Raises Alert Over Economic Impact After Nuclear Test

(BBG) South Korea’s government said the impact of North Korea’s sixth nuclear test could spread from financial markets to the real economy.

Existing uncertainty over trade policy and normalization of monetary policy in major economies could worsen the impact of North Korea’s actions, Finance Minister Kim Dong-yeon said in a meeting with officials from the government, central bank and financial regulator. The impact on financial markets is unlikely to be limited to the short term, he said.

“The government will monitor markets, exports, commodities, and foreign investment around the clock and act accordingly based on a contingency plan,” Kim said.

The recent spate of missile tests by North Korea had already raised concern among some South Korean economists as a risk to business and consumer sentiment.

Read more: Internal and external risks to the economy.

North Korea conducted its latest nuclear test on Sunday, defying international pressure and raising the risk of a military conflict. While past actions by North Korea have resulted only in increased market volatility, the central bank and some economists see the recent actions, including the missile tests, as raising the risk to the real economy.

One of the most important policy responses would be aimed at preventing a downgrade to South Korea’s sovereign credit rating due to the geopolitical risks, Kwon Young-sun, an economist for Nomura International Ltd., wrote in a report. The South Korean government will explain its contingency plan to major ratings agencies, and if situation worsens, could work toward restarting its currency-swap agreement with the Federal Reserve, Kwon wrote.

The won weakened 0.6 percent against the dollar on Monday to 1,129.80 per dollar as of 9:18 a.m. in Seoul. The Kospi stock index fell 1 percent.

+++ V.V.I. (BBG) North Korea Prepares for Possible ICBM Launch, South Says

(BBG) The U.S. ambassador to the United Nations said North Korea was “begging for war” by testing a nuclear weapon over the weekend and demanded the strongest sanctions possible to bring the Kim Jong-Un regime to heel.

“Only the strongest sanctions will enable us to resolve this problem through diplomacy,” Ambassador Nikki Haley said in a meeting of the UN Security Council. She said the U.S. will circulate new draft sanctions measures and wants the council to vote on them Sept. 11.

South Korea, meanwhile, detected preparations by North Korea for a possible intercontinental ballistic missile launch, a move that would further exacerbate tensions a day after its sixth and most powerful nuclear detonation.

Chang Kyung-soo, acting chief of the Defense Ministry’s policy planning office, told lawmakers in Seoul on Monday that North Korea was readying a missile firing, but didn’t give a timeframe. The Yonhap news agency also cited South Korea’s spy agency as saying there is a chance North Korea could fire an ICBM into the Pacific Ocean. North Korea threatened last month to launch missiles toward Guam.

The warning came after South Korea removed the final administrative hurdle for the full deployment of a U.S. missile defense system, called Thaad or Terminal High-Altitude Area Defense, which China sees as a threat to the region’s “strategic equilibrium.” The governments in Seoul and Washington were discussing deployment of a U.S. carrier group and strategic bombers, Yonhap said.

Haley reinforced U.S. President Donald Trump’s threat on Twitter to cut off trade with nations that trade with North Korea. The U.S. “will look at every country that does business with North Korea as a country that gives aid to their reckless intentions,” she said.

Military Drill

South Korea’s military also conducted a live-fire drill, firing a surface-to-surface ballistic missile and air-to-ground rocket into the sea between the Korean peninsula and Japan, with North Korea’s nuclear test site as the virtual target, the Joint Chiefs of Staff said in a text message.

Stocks in Asia and Europe fell, along with S&P index futures, as investors turned to haven assets, sending the yen, gold and Treasury futures higher.

Countries that trade with North Korea include China, the U.S.’s biggest trading partner, which accounted for about a sixth of its overseas commerce.

China hit back at Trump’s threat to cut off trade, with Foreign Ministry spokesman Geng Shuang saying the comments were “neither objective nor fair.”

“What is definitely unacceptable to us is a situation in which on the one hand we work to resolve this issue peacefully but on the other hand our own interests are subject to sanctions and jeopardized,” Geng said at a regular briefing in Beijing, according to the Associated Press.

Kim Jong-un looks at nuclear weaponization in North Korea.

Source: KCNA via EPA

“China has leverage over North Korea, and we should be encouraging them to exercise that leverage,” U.K. Prime Minister Theresa May’s spokeswoman, Alison Donnelly, told reporters in London on Monday. “Our overwhelming view is that diplomatic means are best” for resolving the crisis, she said.

Trump, who threatened over the weekend to pull out of the U.S.-South Korea trade agreement, also took aim at President Moon Jae-in’s administration. South Korea is finding that its “talk of appeasement with North Korea will not work,” he said on Twitter.

In response, Moon’s office said that war shouldn’t be repeated and that South Korea and its allies “will pursue the denuclearization of the Korean peninsula through peace.”

Trump and Moon will speak by phone on Monday, a White House official said.

Moon took power in May pledging to seek peace talks with Kim’s regime. He initially opposed the early deployment of the Thaad missile defense system, though has shifted in recent months as North Korea advanced its push for an intercontinental ballistic missile that could strike the U.S.

The disagreement between allies comes as Trump’s administration looks to convince China and Russia to support stronger sanctions against North Korea at the United Nations Security Council. The U.S. and other nations called for an emergency meeting at 10 a.m. on Monday in New York.

While Trump didn’t rule out an attack on North Korea when asked by a reporter on Sunday, the focus of his tweets and remarks by Treasury Secretary Steven Mnuchin were on tighter sanctions rather than military action. China and Russia oppose military force to deal with North Korea’s nuclear program.

In a call with Japanese Prime Minister Shinzo Abe, Trump “reaffirmed the commitment of the United States to defending our homeland, territories, and allies using the full range of diplomatic, conventional, and nuclear capabilities at our disposal,” the White House said in a statement.


Abe also spoke with Russian President Vladimir Putin late Sunday, telling him that another strong UN resolution was needed.

Sunday’s test, North Korea’s first since Trump took office, was a “perfect success” and confirmed the precision and technology of the bomb, the Korean Central News Agency said. Energy from the underground explosion, near Punggye-ri in the northeast of the country, was about six times stronger than the last test a year ago, South Korea’s weather agency said.

Hans Kristensen, director of the Nuclear Information Project at the Federation of American Scientists, said the international community needs to “come up with a very different game plan than just sanctions and bomber exercises.

“Right now, everything North Korea does appears to have to be bigger and scarier,” he said by email. “The signal they’re sending is the same as always: we don’t care what you say, we can do this and will continue to do so until you stop threatening us. And they seem to have the resources needed to do so despite sanctions.”

G-7 Statement

Leaders of the Group of Seven nations condemned North Korea’s nuclear test, labeling the act as a violation of international law, according to a statement from Japan’s Foreign Ministry. The leaders urged North Korea to immediately “abandon all nuclear and ballistic missile programs.”

The leaders “strongly call on the UN Security Council to meet its responsibilities and to work towards the adoption of a new and effective resolution that includes stronger measures,” according to the statement.

(BBG) Samsung Heir Gets 5 Years for Scandal That Toppled a President

(BBGJay Y. Lee is set to spend the next five years in prison, one of the harshest sentenceshanded to a South Korean chaebol executive, after a court convicted him of bribing his way to greater control of the Samsung empire his family founded.

The trial, part of a bigger corruption scandal that brought down South Korea’s president, transfixed the nation as it shone a spotlight on the close ties between chaebol business groups and the political elite. Prosecutors had sought 12 years in prison for the 49-year-old billionaire, whose lawyer said he would appeal. Any sentence of more than 3 years can’t be suspended.

The judgment reflects a greater willingness by South Korea to break the ties between the wealthy and those in power. In the past, a long list of business leaders, including Lee’s father, were convicted for corrupt behavior only to be let off easy. The younger Lee is unlikely to enjoy such leniency. The Samsung scion, who golfed and traveled extensively to foster ties with tech executives, mostly kept a blank expression as the verdict was read.

“It’s shocking that the disease of political-business collusion between Korea’s most powerful person, the president, and a conglomerate is not a thing of the past but still continuing,” presiding judge Kim Jin-dong told the Seoul Central District Court on Friday. “It will be hard to recover from this loss of faith. The fact that the defendants were executives who represented Samsung Group makes the influence on the society and economy hugely adverse.”

Lee was convicted of all five charges he faced, including allegations of embezzlement.

While the ruling casts doubt over Lee’s return to the conglomerate his grandfather founded almost 80 years ago, the business is doing well, with Samsung Electronics Co. posting record earnings and its shares rising 30 percent this year, outperforming the benchmark Kospi.

Controlled by the Lee family through a web of cross-holdings, Samsung is South Korea’s biggest conglomerate, comprised of about 60 units selling life insurance, cargo ships and clothes. The empire has a market capitalization of about $395 billion, and Samsung Electronics makes up most of that. It is the world’s biggest maker of smartphones and memory chips, with customers including Apple Inc., Wal-Mart Stores Inc. and Microsoft Corp.

The guilty verdict immediately removes the public face of Samsung, which could make it harder for the company to do business in some cases, according to Paul Swiercz, professor of management at George Washington University.

“It will be more difficult for Samsung to negotiate the transnational deals with its present and future global partners,” Swiercz said.

Along with Lee’s sentencing, several former executives were convicted Friday. Former Samsung Corporate Strategy Office chief Choi Gee-sung and former President Chang Choong-ki were each sentenced to four years in prison, while two other executives got suspended prison terms.

The younger Lee’s absence could lead to further empowerment of managers such as Vice Chairman Kwon Oh-hyun, who oversees semiconductors; President J. K. Shin, who is in charge of mobile products; and President Yoon Boo-keun, who runs the consumer appliances business.

Jay Y. Lee arrives at court on Friday, Aug. 25.

Photographer: Chung Sung-Jun/Pool via Bloomberg

Through hundreds of hours of testimony from dozens of witnesses, prosecutors sought to draw a link between backing from a state-run pension for acontentious 2015 merger of Samsung affiliates and money paid to a confidante of then President Park Geun-hye, including an $800,000 horse for the friend’s daughter.

Lee, choking back tears at times, testified that he knew little about Samsung affiliates other than the electronics business, and that he wasn’t part of the approval or decision-making process.

A divide in public opinion was on display outside the courthouse as protesters from both sides gathered and waved placards supporting their views.

“This will also help break ties between politicians and chaebol businessmen,” said Kim Young S., 70. “The decision, proves we live in a society governed by law, that we’ll be punished if we do something wrong no matter how rich or powerful.”

Nearby, Hwang Seon Hee, 59, said: “It was a complete sham. I’m really disappointed by the decision. Lee should be pardoned.”

Jay Y’s father Lee Kun-hee received a suspended three-year prison sentence for evading taxes. He was later pardoned by then-President Lee Myung-bak.

Prosecutors made the case that Lee and former President Park Geun-hye conspired to get a state-backed pension fund to support the 2015 merger in return for financial favors, including the horse.

After Park was impeached and ousted, the new administration of President Moon Jae-in swept into power on pledges to reshape the country to benefit individual Koreans. That includes higher taxes and regulation of the chaebol that dominate the nation’s corporate landscape.

On social media, there was a greater outcry, with many saying that the five-year sentence was too lenient. One commenter, @moonlover333, tweeted: “What?? Only five years…”

+++ V.I. (Express) Kim would ‘CROSS THE RED LINE’ with nuclear warhead – South Korea issues final warning

(ExpressNORTH KOREA would be “crossing a red line” if it put a nuclear warhead on an intercontinental ballistic missile, South Korea has warned.

North Korea latest news  EPA

South Korean President Moon Jae-in has sent North Korea a final warning

South Korean President Moon Jae-in final warning comes after it emerged the US had promised to seek Seoul’s approval before taking any military action.

He said: “I would consider that North Korea is crossing a red line if it launches an intercontinental ballistic missile again and weaponises it by putting a nuclear warhead on top of the missile.”

It comes after North Korea claimed Kim Jong-un had held meetings with his top aides to consider the ramifications of an intercontinental missile strike on the US territory of Guam.

US President Donald Trump said he would react with “fire and fury” at any attempts by North Korea to start a war, leading Pyongyang to declare it will wait for the “foolish Yankee’s” next move before deciding whether to fire a missile at Guam.

North Korea news latest -Kim Jong-unREUTERS

Kim Jong-un has threatened to strike the US territory of Guam

I would consider that North Korea is crossing a red line if it launches an intercontinental ballistic missile again and weaponises it by putting a nuclear warhead on top of the missile

South Korean President Moon Jae-in

President Moon has repeatedly urged North Korea not to “cross the red line” but has not elaborated what that would constitute.

He also revealed Mr Trump had promised to seek negotiations and approval from South Korea before taking any options regarding the hermit state.

The US and South Korea remain technically still at war with North Korea after the 1950-53 Korean conflict ended with a truce, not a peace treaty.

Washington has warned it is ready to use force if needed to stop North Korea’s ballistic missile and nuclear programmes but that it prefers global diplomatic action.

Kim Jong-un has ordered his army to “be ready to strike at all times” after he received a report from his military chiefs on a plan to launch missiles towards the US territory of Guam.

The despotic leader also warned President Trump the US should make “the right choice” to prevent a war.

He claimed it would be the “most delightful historic moment” when the weapons “wring the windpipes of the Yankees and point daggers at their necks”, according to state media.

However, there has been signs of easing in tension on the Korean peninsula as Kim said he will “watch the actions of the US a little bit more” after the US President promised “fire and fury” on the hermit kingdom if they threaten US citizens again.

North Korea latest news - Kim Jong-unGETTY

North Korea would be ‘crossing the red line’ South Korea has said

US Vice President Mike Pence said Wednesday that “all options” remained on the table with regards to North Korea, and he called on Latin American nations to break ties with Pyongyang.

However, White House chief strategist Steve Bannon said there was “no military solution” to the warmongering kingdom’s nuclear threats because of Pyongyang’s massed artillery targeting the South Korean capital.

He said: “Until somebody solves the part of the equation that shows me that 10 million people in Seoul don’t die in the first 30 minutes from conventional weapons, I don’t know what you’re talking about, there’s no military solution here, they got us.”

China, North Korea’s main ally and trading partner, has repeatedly urged Pyongyang to halt its weapons programme and at the same time urged South Korea and the United States to stop military drills in order to lower tensions.

North Korea latest news Donald Trump GETTY

Trump has said he will not enforce military action without addressing South Korea

Bannon said he was pushing the U.S. administration to take a harder line on China trade and not put complaints against its trade practices in the backseat in the hope that Beijing would help restrain leader Kim Jong Un.

Mr Bannon added: “To me, the economic war with China is everything. And we have to be maniacally focused on that.”


(ECO) Ministério Público sul-coreano pede 12 anos de prisão para herdeiro da Samsung

(ECO) Lee Jae-yong, vice-presidente da Samsung e filho do presidente do grupo tecnológico, foi acusado de ter pagado 38 milhões de dólares em subornos à confidente da antiga presidente da Coreia do Sul.

O Ministério Público sul-coreano pediu 12 anos de prisão para o herdeiro da Samsung, pelo seu papel no escândalo de corrupção que levou à destituição da ex-presidente sul-coreana, Park Geun-hye.

O pedido do Ministério Público encerra quatro meses de audiências sobre as alegações contra Lee Jae-yong, que, caso seja condenado, arrisca pelo menos cinco anos de cadeia. Lee Jae-yong, de 49 anos, vice-presidente da Samsung Electronics e filho do presidente do grupo Samsung, foi acusado de ter pagado 38 milhões de dólares (cerca de 32 milhões de euros) em subornos à confidente de Park, Choi Soon-sil.

Conhecida como “Rasputina”, Choi Soon-sil é a figura central no escândalo de corrupção e tráfico de influências que abalou a Coreia do Sul e e levou à destituição da ex-presidente Park, primeira mulher eleita para o cargo.

Segundo a acusação, esses pagamentos teriam sido efetuados pela Samsung para obter “luz verde” do Governo para a fusão controversa entre a C&T e a Cheil Industries, em 2015. A fusão foi denunciada por vários acionistas.

Lee, que se tornou no patrão de facto da Samsung, depois de o pai ter sofrido um ataque de coração em 2014, negou todas as acusações contra si.

(Reuters) Australia, Japan, U.S. call for South China Sea code to be legally binding

(Reuters) Australia, Japan and the United States on Monday urged Southeast Asia and China to ensure that a South China Sea code of conduct they have committed to draw up will be legally binding and said they strongly opposed “coercive unilateral actions”.

The Association of South East Asian Nations (ASEAN) and China should establish a set of rules that were “legally binding, meaningful, effective, and consistent with international law,” the foreign ministers of the three countries said in a statement following a meeting in Manila.

Foreign ministers of ASEAN and China on Sunday adopted a negotiating framework for a code of conduct, a move they hailed as progress but seen by critics as a tactic to buy China time to consolidate its maritime power.

Australia, Japan and the United States also “voiced their strong opposition to coercive unilateral actions that could alter the status quo and increase tensions”.

They also urged claimants to refrain from land reclamation, construction of outposts and militarization of disputed features, in a veiled reference to China’s expansion of its defence capability on Mischief, Fiery Cross and Subi reefs in the Spratly archipelago.

The three countries are not claimants but have long been vocal on the issue, arguing their interest is in ensuring freedom of navigation and overflight.

They urged China and the Philippines to abide by last year’s international arbitration ruling, which invalidated China’s claim to almost the entire South China Sea, where more than $3 trillion worth of sea-borne goods pass every year.

Brunei, Malaysia, the Philippines, Taiwan and Vietnam also have competing claims there.

The code framework is an outline for what China and ASEAN call “consultations” on a formal agreement, which could start later this year. China’s foreign minister, Wang Yi, on Sunday said that hinged on whether the situation was stable, and if there was no “major interference” from outsiders.

Several ASEAN countries want the code to be legally binding, enforceable and have a dispute resolution mechanism, but experts say China will not allow that, and ASEAN may end up acquiescing to what amounts to a gentlemen’s agreement.

Singapore’s foreign minister Vivian Balakrishnan said it was still premature to conclude the outcome of the negotiations for the code of conduct, which will be done by lawyers.

“One key issue is the question of legally binding,” he told reporters late on Sunday. “Surely when we move into the COC, it has got to have some additional or significant legal effect.”

Philippine Foreign Secretary Alan Peter Cayetano said he preferred a legally-binding agreement, which other countries, like Vietnam, supported.

Jay Batongbacal, an expert on the South China Sea at the University of the Philippines, told news channel ANC the adoption of the framework gave China “the absolute upper hand” in terms of strategy, because it will be able to decide when the negotiating process can start.

(Reuters) Russia and China tell North Korea, U.S. and South Korea to embrace de-escalation plan

(Reuters) Russia and China joined diplomatic forces on Tuesday and called on North Korea, South Korea and the United States to sign up to a Chinese de-escalation plan designed to defuse tensions around Pyongyang’s missile program.

The plan would see North Korea suspend its ballistic missile program and the United States and South Korea simultaneously call a moratorium on large-scale missile exercises, both moves aimed at paving the way for multilateral talks.

The initiative was set out in a joint statement from the Russian and Chinese foreign ministries issued shortly after President Vladimir Putin and Chinese President Xi Jinping held wide-ranging talks in the Kremlin.

“The situation in the region affects the national interests of both countries,” the joint statement said. “Russia and China will work in close coordination to advance a solution to the complex problem of the Korean Peninsula in every possible way.”

North Korea said on Tuesday it had successfully test-fired an intercontinental ballistic missile (ICBM) for the first time, which flew a trajectory that experts said could allow a weapon to hit the U.S. state of Alaska.

Russia and China both share a land border with North Korea and have been involved in past efforts to try to calm tensions between Pyongyang and the West.

Moscow and Beijing used the same joint declaration to call on Washington to immediately halt deployment of its THAAD anti-missile system in South Korea, a move Washington says is necessitated by the North Korean missile threat.

The statement said Washington was using North Korea as a pretext to expand its military infrastructure in Asia and risked upsetting the strategic balance of power in the area.

“The deployment … of THAAD will cause serious harm to the strategic security interests of regional states, including Russia and China,” the statement said.

“Russia and China oppose the deployment of such systems and call on the relevant countries to immediately halt and cancel the process of deployment.”

+++ V.V.I. (BBG) South Korea Suspends Missile Shield Deployment, Yonhap Says

(BBG) South Korea’s new president is suspending the installation of remaining components of a controversial U.S. missile shield pending an environmental impact assessment, Yonhap News reported, leaving the system incomplete while North Korea steps up its missile development.

“We are not saying the two launchers and other equipment that has already been deployed should be withdrawn,” a senior official at President Moon Jae-in’s office said Wednesday, according to Yonhap. “But those that have yet to be deployed will have to wait.”

The official said the assessment could take as long as a year, slowing down the full installation of a missile system that China opposes.

During his election campaign, Moon called for a review of the deployment of the Terminal High Altitude Area Defense shield that was approved by his predecessor Park Geun-hye. He ordered an investigation last month into how the final components of the Thaad battery arrived in the country without the defense ministry informing him.

Two of the six launchers that form a complete battery were deployed in April in Seongju county, more than 200 kilometers (125 miles) southeast of Seoul, amid protests from residents. The remaining four launchers are needed to make the system fully operational.

Minimize Effectiveness

“Only having two deployed will certainly minimize the strategic effectiveness of the system,” said Michael Raska, an assistant professor in the military transformations program at the S. Rajaratnam School of International Studies in Singapore. “Of course, that doesn’t mean that they won’t have any coverage at all.”

U.S. Defense Secretary James Mattis said last week that Thaad was dispatched to respond to the “real problem” of North Korea, which has tested ballistic missiles nine times this year as part of its nuclear weapons program. China objects to the deployment over concerns its powerful radar would allow spying on its own missile systems.

“There is a confluence of South Korea’s domestic policy in a country that is deeply divided over this issue and Chinese pressure at play here,” said Raska. “If South Korea accepts Thaad, it becomes increasingly dependent on the U.S., and South Korea is becoming increasingly worried about any unilateral decision by the United States against North Korea.”

China is aware of the report and is following domestic developments in South Korea closely, foreign ministry spokeswoman Hua Chunying said at a news briefing in Beijing. “No matter what happens, we are firmly opposed to the deployment of the Thaad system,” she added.

(Reuters) South Korea’s new leader discusses North Korea, defense system with China’s Xi

(Reuters) South Korea’s new President Moon Jae-in told Chinese leader Xi Jinping on Thursday that North Korea must cease making provocations before tensions over the deployment of a U.S. anti-missile system in the South can be resolved, officials said.

Moon came to power with a promise to review the deployment of the Terminal High Altitude Area Defense (THAAD) anti-missile system, which is opposed by China but is being deployed as a show of strength against continued provocation by the North.

In the first direct contact between the South Korean and Chinese leaders, Xi explained China’s position, Yoon Young-chan, a spokesman for South Korea’s presidential office said without elaborating.

China has rigorously objected to the deployment, saying it destabilized the regional security balance and did little to curb the threat posed by North Korea’s nuclear and missile programs, which Pyongyang is conducting in defiance of U.S. pressure and United Nations sanctions.

“President Moon said he understands China’s interest in the THAAD deployment and its concerns, and said he hopes the two countries can swiftly get on with communication to further improve each other’s understanding,” Yoon told a briefing.

“President Moon said the THAAD issue can be resolved when there is no further provocation by North Korea,” Yoon said.

Moon said in his first speech as president soon after he was sworn in on Wednesday that he would immediately begin efforts to defuse security tensions on the Korean peninsula and negotiate with Washington and Beijing to ease the THAAD row.

He also said he was prepared to go to Pyongyang “if the conditions are right”.

Moon’s swearing-in brought to an end a months-long power vacuum after previous president Park Geun-hye was ousted in a corruption scandal in March.

Regional experts have believed for months that North Korea was preparing for its sixth nuclear test and was working to develop a nuclear-tipped missile capable of reaching the United States, presenting U.S. President Donald Trump with perhaps his most pressing security issue.

(For a graphic on South Korea’s presidential election, click


As well as clouding efforts to rein in North Korea’s nuclear ambitions, the THAAD deployment has also led to recriminations from Beijing against South Korean companies.

Moon explained the difficulties faced by South Korean companies that are doing business in China and asked for Xi’s “special attention” to ease those concerns, Yoon said.

South Korea and the United States began deploying the THAAD system in March and it has since become operational.

China sees it as a threat to its security and has called for its withdrawal, but has also denied it was doing anything to retaliate against South Korean businesses.

Xi told Moon Seoul and Beijing should respect each other’s concerns, set aside their differences, seek common ground and handle disputes appropriately, China’s foreign ministry said in a statement.

“For a long time, China has upheld the goal of the denuclearisation of the Korean peninsula, protecting the peace and stability of the peninsula and resolving the problem via dialogue and consultation,” Xi said, according to the ministry.

The deployment of the THAAD system was agreed on by Park’s administration last year after North Korea conducted a long-range rocket launch that put an object into space. Moon said during the campaign for this week’s snap election that he wanted to review that decision.

He and Xi agreed to exchange special envoys soon and Moon said he also planned to send a delegation to Beijing to discuss the North Korean nuclear problem and the THAAD deployment, according to Yoon.

Despite Chinese anger at North Korea’s repeated nuclear and missile tests, China remains the isolated state’s most important economic and diplomatic backer, even as Beijing has signed up for tough U.N. sanctions against Pyongyang.

China’s foreign ministry made no direct mention of the anti-missile system in its statement about the discussions. Beijing hopes that the new South Korean government attaches importance to China’s major concerns and takes real steps to promote the healthy and stable development of ties, Xi said.

Moon later spoke with Japanese Prime Minister Shinzo Abe and agreed to hold a bilateral meeting soon, Seoul and Tokyo said.

Japan has been concerned that Moon will take a tough line on feuds stemming from the bitter legacy of its 1910-1945 colonization of the Korean peninsula and could fray ties at a time when cooperation on North Korea was vital.

Moon told Abe to “look straight at history” and not make the past “a barrier”, South Korea’s presidential office said.

(AP) S. Korea’s leader willing to visit North, talk to US, China


SEOUL, South Korea (AP) — New South Korean President Moon Jae-in said as he took office Wednesday that he is open to visiting rival North Korea under the right conditions to talk about its aggressive pursuit of nuclear-tipped missiles.

Moon’s softer stance on North Korea could create friction with Washington, which has swung from threats of military action to hints of dialogue as it seeks to formulate a policy under President Donald Trump.

Liberal candidate Moon Jae-in was leading the South Korean presidential election with 60 percent of votes counted. (May 9)

South Korea’s first liberal leader in a decade, Moon also said he’ll “sincerely negotiate” with the United States, Seoul’s top ally, and China, South Korea’s top trading partner, over the contentious deployment of an advanced U.S. missile-defense system in southern South Korea. The system has angered Beijing, which says its powerful radars allow Washington to spy on its own military operations.

In a speech at the National Assembly, Moon pledged to work for peace on the Korean Peninsula amid growing worry over the North’s expanding nuclear weapons and missiles program.

“I will quickly move to solve the crisis in national security. I am willing to go anywhere for the peace of the Korean Peninsula — if needed, I will fly immediately to Washington. I will go to Beijing and I will go to Tokyo. If the conditions shape up, I will go to Pyongyang,” Moon said.

Moon assumed presidential duties early in the morning after the National Election Commission finished counting Tuesday’s votes and declared him winner of the special election necessitated by the ousting of conservative Park Geun-hye, whose downfall and jailing on corruption charges is one of the most turbulent stretches in the nation’s recent political history.

At his first news conference at the presidential Blue House, Moon introduced his nominees for prime minister, the country’s spy chief and his presidential chief of staff. The usual circumstances of the election and immediate transition into office meant Moon inherited several officials from Park’s government, and he has moved quickly to replace them.

The nomination of Lee Nak-yon as prime minister was seen as an attempt to get more support from the southwestern liberal stronghold where Lee had served as governor and lawmaker. Lawmakers must approve Lee for the country’s No. 2 job, which was largely a ceremonial post before Park’s removal made current Prime Minister Hwang Kyo-ahn a government caretaker.

Moon’s pick for National Intelligence Service chief is Suh Hoon, a longtime intelligence official Moon said would be the right man to push reforms at NIS, which has long been accused of meddling in domestic politics. The NIS nomination does not require lawmakers’ approval, although Suh must first go through a National Assembly hearing.

Talking to reporters, Suh endorsed Moon’s call for a summit meeting with North Korean ruler Kim Jong Un, although saying it would be difficult for such a meeting to take place soon, considering the tension over the North’s nuclear program.

“The talk about a South-North summit is a little premature, but regardless of that, there’s a need for a summit meeting,” Suh said. “If conditions ripen and provide opportunities to significantly lower military tension in the Korean Peninsula and open a path toward solving the North Korean nuclear problem, which is the most urgent threat to our security, then I think (Moon) will be able to go to Pyongyang.”

In his earlier speech at the National Assembly, Moon thanked the millions of South Koreans who peacefully protested for months seeking the ouster of Park, who was impeached and arrested in March and faces a trial later this month that could send her to prison for life if she is convicted. Moon also offered a message of unity to his political rivals — Moon’s Democratic Party has only 120 out of 300 seats in the National Assembly, so he may need broader support while pushing his key policies.

“Politics were turbulent (in the past several months), but our people showed greatness,” Moon said.

“In face of the impeachment and arrest of an incumbent president, our people opened the path toward the future for the Republic of Korea,” said Moon, referring to South Korea’s formal name. To his rivals, Moon said, “We are partners who must lead a new Republic of Korea. We must put the days of fierce competition behind and hold hands marching forward.”

Moon began his duties earlier in the day by receiving a briefing about North Korea from Army Gen. Lee Sun-jin, chairman of South Korea’s Joint Chiefs of Staff, and he visited a national cemetery in Seoul where he wrote in a visitor book: “A country worth being proud of; a strong and reliable president!”

The leaders of China, Japan and other countries sent their congratulations. South Korea’s relations with Japan are strained by the Japanese military’s sexual exploitation of South Korean women during World War II, and relations with China have been irritated over the THAAD anti-missile system deployment. Moon made a campaign vow to reconsider THAAD.

(BBG) Pence Visits North Korea Border, `Heartened’ by China Moves

(BBG) U.S. Vice President Mike Pence encouraged China to take action against North Korea while he met with troops a day after Kim Jong Un’s regime defied the Trump administration with a ballistic missile test.

On a visit to the demilitarized zone between North Korea and South Korea, Pence said he was “heartened” by early signs from China and hoped its leaders would “use the extraordinary levers they have” to prod Kim into giving up his nuclear weapons and ballistic missiles. He repeated President Donald Trump’s warning that the U.S. would act without China if necessary.

Mike Pence look across to the north side of the border on April 17.

Photographer: SeongJoon Cho/Bloomberg

“Either China will deal with this problem or the United States and its allies will,” Pence said on Monday. “We want to see change. we want to see North Korea abandon its reckless path.”

Trump’s team is weighing options for preventing Kim from acquiring the ability to strike North America with a nuclear weapon. The administration is leaning on China, North Korea’s main ally and benefactor, and seeking to bolster missile defense systems in allies South Korea and Japan.

China isn’t the key to resolving problems on the Korean Peninsula, Foreign Ministry spokesman Lu Kang told reporters in Beijing on Monday, repeating a call for all parties to avoid any provocations. North Korea snubbed senior Chinese diplomats this month as tensions mounted with the U.S., according to people familiar with the situation, raising questions about the influence Beijing’s leaders have over the country.

Read more about North Korea snubbing China’s diplomats

Initial reports indicate the projectile North Korea launched on Sunday was a medium-range missile and failed after about four or five seconds, a White House foreign policy adviser told reporters. That eased the risk of imminent retaliation from Trump, who had sent warships to the region.

Trump is still willing to consider military action, including a sudden strike, to counteract North Korea’s series of destabilizing actions, said two people familiar with the White House’s thinking. Even so, he isn’t interested in regime change and prefers to have China take the lead on handling North Korea, said the people, who asked not to be named because the discussions are private.

Trump’s strikes in Syria and Afghanistan this month were an indication that “North Korea would do best not to test his resolve,” Pence said at a news briefing with South Korean Acting President Hwang Kyo-ahn in Seoul later Monday. “We will meet any attack” and respond to any use of conventional or nuclear weapons, Pence said.

At the briefing, Pence repeated his optimism that China will deal with North Korea, while saying he was discouraged by the nation’s economic retaliation against South Korea for allowing the U.S. to install a missile defense system on its soil.

Graphic: Kim Jong Un’s Big Nuclear Push Is Closing In on America

Hwang said that the country will try to swiftly deploy the Terminal High Altitude Area Defense system, known as Thaad. China is concerned at the surveillance capabilities of Thaad and has responded by restricting sales of tour packages and suspending more than half of the stores Lotte operates in China, citing alleged fire safety violations.

Trump has sought to pressure China by linking North Korea to economic policy, including the nation’s currency policy.

“Why would I call China a currency manipulator when they are working with us on the North Korean problem?” Trump tweeted on Sunday. “We will see what happens!”

China’s State Councilor Yang Jiechi and U.S. Secretary of State Rex Tillerson exchanged views on the situation on the Korean Peninsula by phone on Sunday, China’s foreign ministry said, without giving more details.

Japanese Prime Minister Shinzo Abe said on Monday that he would also urge China to play a bigger role in resolving tensions over North Korea. U.S. cooperation and diplomatic efforts are also important, he told lawmakers, warning that Kim’s regime is believed to hold a “substantial” amount of chemical weapons and may be able to place sarin on a ballistic missile.

Timeline: North Korea Provocations

Any U.S. military strike risks leading to a war that may devastate South Korea and Japan, two American allies in striking range of retaliatory attacks. China has backed North Korea since the peninsula was last at war in the 1950s, in part to prevent having an American ally on its border.

Kim’s regime has test-fired ballistic missiles five times this year in his quest to develop a device that can carry a nuclear warhead to the continental U.S. He’s launched dozens of projectiles and conducted three nuclear tests since coming to power after his father’s death in 2011, and claimed in January to be almost ready to test-fire an intercontinental ballistic missile.

Kim showed off a range of long-range missiles at an elaborate military parade on Saturday, including submarine-launched ballistic missiles for the first time and what appeared to be a new ICBM — though analysts have suggested that some weapons displayed at past parades have been fake. A senior regime leader repeated warnings that North Korea was ready for a nuclear or full-scale war.

Demilitarized Zone

Pence arrived Monday morning by helicopter to Camp Bonifas. He went on to tour the Joint Security Area, where troops from both countries face one another in the heavily fortified demilitarized zone dividing the Korean Peninsula.

South Korea is the first stop for Pence on a previously scheduled trip through Asia that will also take him to Japan, Indonesia and Australia. Pence is the highest ranking U.S. official to visit the DMZ since former President Barack Obama did so in 2012. Tillerson greeted troops at Camp Bonifas during a trip last month.

(ZH) South Korean Paper Reports China Has Deployed 150,000 Troops To North Korea Border

(ZH) While the catalyst is unclear, it appears the market dropped as headlines of further sanctions against Russiaappeared and reports of China deploying 150,000 troops to its North Korea border.

According to Korean news agency Chosun, the “Chinese army has deployed about 150,000 troops to the North Korean border in two groups to prepare for unforeseen circumstances.” The reason: the prospect of “military options”, such as preemptive attacks on North Korea, like the one the United States launched on Syria.

More Google translated:

As the United States announced its independent North Korean behavior and moved the United States Navy’s nuclear-powered Calvinus (CVN-70) carrier class to Singapore, the Chinese army has deployed about 150,000 troops in two groups to prepare for unforeseen circumstances.


“The report said. It is because of the prospect of taking “military options”, such as preemptive attacks on North Korea, just as the United States has launched an air raid on Syria.


Japan’s Sankei Shimbun reported on the 9th that the Syrian missile strike in the United States shocked China, suggesting that the People’s Liberation Army forces are moving toward the Yalu River, .


The newspaper said the video was also broadcast on the Internet, but the authorities removed the relevant information, saying the move was a medical and aft support unit for the Shenyang bulb (the northern light bulb)

Another possible catalyst is a report by Russia’s interfax that Moscow is preparing for more sanctions, and has warned local air companies about a possible suspension of charter flights with Tu


Whatever the catalyst, the reaction is clear:

Dropping stocks below the levels right before Syrian airstrikes began…


The Dow is back at crucial support at the 50–day moving average…


Taking everything but Trannies back into the red for the day.

Gold is bid back over $1250 as USDJPY suddenly plunges.

(Reuters) South Korean court throws president out of office, two dead in protest

(Reuters) South Korea’s Constitutional Court removed President Park Geun-hye from office on Friday over a graft scandal involving the country’s conglomerates at a time of rising tensions with North Korea and China.

The ruling sparked protests from hundreds of her supporters, two of whom were killed in clashes with police outside the court.

Park becomes South Korea’s first democratically elected leader to be forced from office, capping months of paralysis and turmoil over a corruption scandal that also landed the head of the Samsung conglomerate in jail.

A snap presidential election will be held within 60 days.

She did not appear in court and a spokesman said she would not be making any comment nor would she leave the presidential Blue House residence on Friday.

“For now, Park is not leaving the Blue House today,” Blue House spokesman Kim Dong Jo told Reuters.

Park was stripped of her powers after parliament voted to impeach her but has remained in the president’s official compound.

The court’s acting chief judge, Lee Jung-mi, said Park had violated the constitution and law “throughout her term”, and despite the objections of parliament and the media, she had concealed the truth and cracked down on critics.

Park has steadfastly denied any wrongdoing.

The ruling to uphold parliament’s Dec. 9 vote to impeach her marks a dramatic fall from grace of South Korea’s first woman president and daughter of Cold War military dictator Park Chung-hee, both of whose parents were assassinated.

Park, 65, no longer has immunity as president, and could now face criminal charges over bribery, extortion and abuse of power in connection with allegations of conspiring with her friend, Choi Soon-sil.


Prime Minister Hwang Kyo-ahn was appointed acting president and will remain in that post until the election. He called on Park’s supporters and opponents to put their differences aside to prevent deeper division.

“It is time to accept, and close the conflict and confrontation we have suffered,” Hwang said in a televised speech.

A liberal presidential candidate, Moon Jae-in, is leading in opinion polls to succeed Park, with 32 percent in one released on Friday. Hwang, who has not said whether he will seek the presidency, leads among conservatives, none of whom has more than single-digit poll ratings.

“Given Park’s spectacular demise and disarray among conservatives, the presidential contest in May is the liberals’ to lose,” said Yonsei University professor John Delury.

Relations with China and the United States could dominate the coming presidential campaign, after South Korea this month deployed the U.S. THAAD missile defense system in response to North Korea’s stepped up missile and nuclear tests.

Beijing has vigorously protested against the deployment, fearing its radar could see into its missile deployments. China has curbed travel to South Korea and targeted Korean companies operating in the mainland, prompting retaliatory measures from Seoul.

The Seoul market’s benchmark KOSPI index .KS11 and the KRW= rose after the ruling.

The prospect of a new president in the first half of this year instead of prolonged uncertainty will buoy domestic demand as well as the markets, said Trinh Nguyen, senior economist at Natixis in Hong Kong.

“The hope is that this will allow the country to have a new leader that can address long-standing challenges such as labor market reforms and escalated geopolitical tensions,” he said.

Park was accused of colluding with her friend, Choi, and a former presidential aide, both of whom have been on trial, to pressure big businesses to donate to two foundations set up to back her policy initiatives.

The court said Park had “completely hidden the fact of (Choi’s) interference with state affairs”.

Park was also accused of soliciting bribes from the head of the Samsung Group for government favors, including backing a merger of two Samsung affiliates in 2015 that was seen as supporting family succession and control over the country’s largest “chaebol” or conglomerate.

Samsung Group leader Jay Y. Lee has been accused of bribery and embezzlement in connection with the scandal and is in detention. His trial began on Thursday.

He and Samsung have denied wrongdoing.


The scandal and verdict have exposed fault lines in a country long divided by Cold War politics.

While Park’s conservative supporters clashed with police outside the court, elsewhere, most people welcomed her ouster. A recent poll showed more than 70 percent supported her impeachment.

Hundreds of thousands of people have for months been gathering at peaceful rallies in Seoul every weekend to call for her to step down.

On Friday, hundreds of Park’s supporters, many of them elderly, tried to break through police barricades at the courthouse. Police said one 72-year-old man was taken to hospital with a head injury and died. The circumstances of the second death were being investigated.

Six people were injured, protest organizers said.

Police blocked the main thoroughfare running through downtown Seoul in anticipation of bigger protests.

Park will be making a tragic and untimely departure from the Blue House for the second time in her life.

In 1979, having served as acting first lady after her mother was killed by a bullet meant for her father, she and her two siblings left the presidential compound after their father was killed.

This time, she could end up in jail.

Prosecutors have named Park as an accomplice in two court cases linked to the scandal, suggesting she is likely to be investigated.

North Korean state media wasted little time labeling Park a criminal.

“She had one more year left as ‘president’ but, now she’s been ousted, she will be investigated as a common criminal,” the North’s state KCNA news agency said shortly after the court decision.

(Reuters) China reacts with anger, threats after South Korean missile defense decision

(Reuters) Chinese state media have reacted with anger and boycott threats after the board of an affiliate of South Korea’s Lotte Group approved a land swap with the government that allows authorities to deploy a U.S. missile defense system.

The government decided last year to deploy the U.S. Terminal High Altitude Area Defense (THAAD) system, in response to the North Korean missile threat, on land that is part of a golf course owned by Lotte in the Seongju region, southeast of Seoul.

The board of unlisted Lotte International Co Ltd approved the deal with the government on Monday.

China objects to the deployment in South Korea of the THAAD, which has a powerful radar capable of penetrating Chinese territory, with Beijing saying it is a threat to its security and will do nothing to ease tension with North Korea.

Lotte should be shown the door in China, the influential state-run Chinese tabloid the Global Times said in an editorial on Tuesday.

“We also propose that Chinese society should coordinate voluntarily in expanding restrictions on South Korean cultural goods and entertainment exports to China, and block them when necessary,” it said in its English-language edition.

The paper’s Chinese version said South Korean cars and cellphones should be targeted as well.

“There are loads of substitutes for South Korean cars and cellphones,” it said.

China has already twice issued “solemn representations” to South Korea about the most recent THAAD-related developments, Chinese Foreign Ministry spokesman Geng Shuang told a daily briefing in Beijing.

But it welcomes foreign companies to operate in China, he said. “Whether or not a foreign company can operate successfully in China, in the end is a decision for the Chinese market and consumer,” he added.

Late on Monday, the ruling Communist Party’s official People’s Daily said cutting diplomatic ties should be considered.

“If THAAD is really deployed in South Korea, then China-South Korea relations will face the possibility of getting ready to cut off diplomatic relations,” it said on the WeChat account of its overseas edition.

The official Xinhua news agency also said in a commentary late on Monday that China “did not welcome this kind of Lotte”.

“Chinese consumers can absolutely say no to this kind of company and their goods based on considerations of ‘national security’,” it said.

South Korea’s defence ministry said on Tuesday it had signed a land swap deal, with Lotte exchanging the golf course for military property. A South Korean military official told Reuters the military would begin area patrols and install fences.

The Lotte Group said on Feb. 8 Chinese authorities had stopped construction at a multi-billion dollar real estate project in China after a fire inspection, fuelling concern in South Korea about damage to commercial ties with the world’s second-largest economy.

Asked if South Korea had demanded the Chinese government suspend any economic retaliation, South Korean Defence Ministry spokesman Moon Sang-kyun said: “We have continuously persuaded China so far and will keep continuing efforts to do so.”

South Korean government officials have said THAAD is a defensive measure against North Korean threats and does not target any other country.

South Korea’s central bank said this month the number of Chinese tourists visiting the tourist island of Jeju had fallen 6.7 percent over the Lunar New Year holiday from last year, partly because of China’s “anti-South Korea measures due to the THAAD deployment decision”.

(BBG) Samsung Heir Jay Y. Lee Is Arrested on Bribery Allegations

(BBG) Samsung Group’s Jay Y. Lee was formally arrested on allegations of bribery, perjury and embezzlement, an extraordinary step that jeopardizes the executive’s ascent to the top role at the world’s biggest smartphone maker.

The Seoul Central District Court issued the warrant for Lee’s arrest early Friday. Including procedural steps and appeals, it may take as long as 18 months for a trial and verdict. The decision was made because of the risk that he might destroy evidence or flee, a court spokesperson said.

Investigators are looking into whether the vice chairman of Samsung Electronics Co. was involved in providing as much as 43 billion won ($38 million) to benefit a close friend of South Korean President Park Geun-hye, in exchange for government support of his management succession. Prosecutors allege that Lee, 48, funded Park’s associates as he tried to consolidate control over the sprawling conglomerate founded by his grandfather.

South Korea’s Family-Run Conglomerates

Lee, who had been waiting for the court’s decision at a detention center in Seoul, will remain there as a result of the arrest warrant. The court rejected the prosecutor’s request to arrest Samsung Electronics President Park Sang-Jin. With Lee under detention, Park will probably assume some of Lee’s responsibilities.

“We will do our best to ensure that the truth is revealed in future court proceedings,” Samsung Group said in a statement. The shares of Samsung fell less than 1 percent in Seoul. Prior to the arrest, the stock had climbed 5.5 percent this year, following a 43 percent rally in 2016.

“In the short term, it could have an impact on the stock, only because of sentiment, and also because the stock has risen a lot recently,” said Jung Sang-jin, a fund manager at Korea Investment Management, which includes Samsung Electronics in its holdings. “In the long-term, there won’t be much impact on the stock, given previous times when other chaebol heads were arrested with few problems for their companies to keep running the business.”

After the prosecutor’s first attempt to arrest Lee was rejected by a court onJan. 19 due to lack of evidence, the billionaire heir was called in again for 15 hours of questioning on Monday as investigators sought more information. In their second attempt, a spokesman for the special prosecutor saidTuesday that they found evidence of Lee concealing profit gained through criminal acts and hiding assets overseas.

“The special prosecutor definitely has plans to push ahead with the indictment,” the spokesman said. “Last time, we’ve found that his bribery was mainly associated with the merger. But it’s been additionally discovered that it wasn’t only related to the merger but also to his succession.”

Samsung has denied it made an unlawful offer or paid a bribe to the president in exchange for favors. The conglomerate’s transition to a new, younger leader was already marred by last year’s botched debut of the Note 7, a smartphone that was discontinued after it showed a tendency to catch fire and explode.

Lee has been the de facto head of Samsung with his father Lee Kun Hee hospitalized since 2014.

“Unlike other Chaebols, Samsung’s top leader plays a very passive role inside the group,” said Kim Sang-jo, a professor at Hansung University. “However, major management decisions or succession planning, such as mega acquisition deals, as well as the overall management shake-up will be considerably delayed.”

The Samsung probe is part of a broader investigation into contributions that dozens of Korean companies gave to Choi Soon-sil, a confidante of Park. The scandal has rocked South Korea with millions of people taking to the streets in protest. President Park has been impeached and her powers suspended. A separate constitutional court will determine whether she is ultimately removed from office, another tumultuous chapter for a country that became a full-fledged democracy in 1987.

Watch Next: South Korea’s Family-Run Conglomerates Are Under Pressure

When he testified at a parliamentary hearing in December, Lee said he never ordered donations to be made in return for preferential measures and rejected allegations he received wrongful government support to push through a merger of two Samsung affiliates in 2015. Still, Lee, who has been put under a travel ban, confirmed he had private meetings with Park and that Samsung had provided a horse worth 1 billion won that was used for equestrian lessons by Choi’s daughter.

When the merger of Cheil Industries Inc. and Samsung C&T Corp. was originally proposed, shareholders including activist investor Paul Elliott Singer fought against it, arguing the purchase price was too low and would cement the founding family’s control at the expense of minority shareholders. Samsung responded by saying it was trying to create long-term value for investors and the merger was necessary to sustain growth.

Korea’s National Pension Service, a $452 billion government-backed fund with money from 22 million citizens, was the largest investor in Samsung C&T and voted in favor of the merger, playing a key role in its narrow approval. With the merger, Lee ended up with a 17 percent stake in the combined entity, making him the largest shareholder. The merged company, now just called Samsung C&T, is in turn one of the largest shareholders in Samsung Electronics.

(BBG) S. Korea Court Rejects Arrest Warrant for Samsung’s Jay Y. Lee

…Power is power…

(Bloomberg) — Seoul Central District Court rejected the special prosecutor’s request to issue an arrest warrant for Samsung Electronics Vice Chairman Jay Y. Lee, the de facto head
of Samsung Group.

* Rejection of the arrest warrant means Lee will not be
detained; prosecutors still can continue to investigate or
indict him
* NOTE: Special prosecutor team had sought arrest of Lee
during an investigation into allegations Samsung paid bribes
in exchange for political favors from the country’s