An Italian animation company has agreed to pay the US Treasury Department $538,000 for “apparent violations” of US sanctions against North Korea by conducting business with a North Korean state-owned animation studio. This marks the first instance of financial penalties being imposed related to sanctions on North Korea’s movie and animation industry.
The Rome-based animation firm, Mondo TV, S.p.a., sent wire transfers through US financial institutions to pay North Korea’s flagship studio, SEK, approximately $538,000 for outsourced animation work between May 2019 and November 2021. To process the payments, SEK utilized “third-party companies” in China and the US that had accounts at “several” US banks.
Mondo TV Group's CEO, Matteo Corradi, declined to comment on the matter. Mondo has been in operation since 1985 and has produced or distributed various popular cartoons in Italy, including “Sandokan – The Two Tigers.”
The Treasury Department investigation revealed that the business relationship between Mondo and SEK dates back to the 1990s when Mondo began subcontracting animation work to SEK for various programming, including children’s animation. The outsourcing contract explicitly referenced North Korea, and SEK animators even received training in Italy provided by Mondo.
US officials have been vigilant in tracking and intercepting funds related to North Korea, given the regime's nuclear ambitions. The use of the US financial system by Mondo to send money to North Korea triggered the Treasury investigation and subsequent fines.
Experts have highlighted the significance of the settlement as a reminder of the active sanctions regime against North Korea. Despite being heavily sanctioned, North Korea's animation industry has served as a crucial revenue source for the country.
Recent findings of animation sketches on a North Korean server suggest potential involvement of North Korean graphic designers in producing work for US animation studios without their knowledge. Additionally, experts speculate that Chinese workers may have also participated in the outsourcing work.
