On the August 29, Joongang Daily, one of South Korea's major national newspapers, broke sensational news. According to an unnamed high level source, a senior North Korean banking official named Yun Tae-hyong, recently disappeared while on a business trip to Russia. Reportedly, he took about $5m from Daesong Bank.
Frankly, one has to be quite careful when it comes to such stories and reports. In the past, the South Korean and Japanese media has frequently reported rumours about defections that eventually proved to be false. Nonetheless, Joongang Daily is a reputable newspaper, not known for its sensationalism. Thus, its editors were probably quite certain when they decided to publish such allegations. And it should also be noted that it fits in well with what we have been hearing out of Pyongyang of late.
Daesong Bank, where Yun was an official, is a very peculiar institution. It is for all intents and purposes the command centre of what is known as North Korea's "palace economy" - a network of trade companies, industrial enterprises, mines and banks that are not managed by the North Korean cabinet, but rather are under the immediate control of the ruling Korean Workers' Party (the local incarnation of the communist party) and its oligarchy.
Daesong Bank and associated institutions are often described as the managers of the Kim dynasty's slush funds. It is often stated that the major source of income for the "palace economy" is contraband (i.e. narcotics, counterfeit $100 bills etc). While such reports are not completely lacking foundation, they are seriously exaggerated. The actual picture is somewhat less menacing, but perhaps more interesting.
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[Continued at source]