North Korea
October 10, 2019

Wise Honest Departs U.S. Following Sale at Auction

By Samuel Rubenfeld

Wise Honest (Photo: U.S. Department of Justice)

 

The Wise Honest departed U.S. waters under tow this week following the sale of the vessel at auction, according to the U.S. Coast Guard.

The bulk carrier ship was seized by U.S. authorities in May following a criminal complaint filed in New York federal court alleging that the vessel was part of a broader sanctions-evasion scheme conducted by the North Korean government. Pyongyang sought to use the vessel to export high-grade coal and import heavy machinery, U.S. prosecutors said at the time.

The Wise Honest was sold at a court-directed auction, according to the Coast Guard. It stayed for five months at the port of Pago Pago, American Samoa, prior to Monday’s departure, the Coast Guard said, noting that the tug arrived Friday following approval of a tow plan. The Coast Guard said it conducted safety and security patrols at various times during the detainment.

The U.S. Marshals Service held a sealed auction for the vessel from July 31 to Aug. 9, and a winning bidder was selected, a spokeswoman for the marshals confirmed Thursday in an email. The sale was completed Sept. 12, she said, adding that the U.S. Marshals Service doesn’t disclose winning bid amounts or the identity of a buyer in its sealed auctions.

Maritime data reviewed Thursday by Kharon does not identify a new owner of the Wise Honest. Its registered owner is Korea Songi Shipping Company, an affiliate of Korea Songi General Trading Corp., which was sanctioned in June 2017 for exporting North Korean coal. The company had taken ownership of the vessel in January 2018, according to maritime data, though U.S. prosecutors, citing a letter bearing the letterhead of Korea Songi General Trading, said the transfer took place earlier, in February 2017. 

Though the Wise Honest is being tugged, according to a Korean-language report published Oct. 7 by Voice of America, a source said that the vessel could resume normal operation by restarting the power. The Wise Honest hadn’t broadcast a signal depicting its location, known as its Automatic Identification System (AIS), since August 2017, prosecutors said in May. The vessel still has not turned on its AIS system, maritime data shows.

The United Nations Panel of Experts in August investigated the sanctions evasion techniques carried out by the operators and shipping brokers for the Wise Honest, finding that Hong Kong companies were involved in various aspects of the scheme. The coal, which was seized and later released by Indonesian authorities, was transferred to a vessel, the Dong Thanh. The Dong Thanh is located in the open waters of Vietnam, according to maritime data.

Analysts from the Asia team contributed to this report.