＜Inside N. Korea＞ Counterfeit Money Flooding: NK Won, Chinese Yuan, and 'Donpyo' Vouchers Spreading Despite Major Crackdowns

Sophisticated counterfeit bills are circulating in large quantities throughout North Korea. The counterfeits extend beyond North Korean won to include Chinese yuan and the 'money vouchers' known as donpyo. Despite authorities' vigorous crackdown efforts, the circulation continues unimpeded. This information was reported in mid-April by two reporting partners living in the northern region. (HONG Mari / KANG Ji-won)

◆Possession of Counterfeit Money Alone Warrants Punishment

According to a reporting partner from Hyesan in Ryanggang Province, counterfeit money has been circulating in large quantities in Pyongsong City, North Pyongan Province, and has spread to other regions causing disruption. Reportedly, North Korean 5,000 won notes, Chinese 20 yuan notes, and 'donpyo' money vouchers are particularly common among the counterfeits.
※Donpyo is a temporary monetary voucher issued by the Central Bank of North Korea as a relief measure during the severe economic crisis following the COVID-19 pandemic. It can be exchanged for regular currency of the same denomination, with the highest denomination being 50,000 won.

The reporting partner said: "Authorities have issued a directive through neighborhood units to 'thoroughly report fake money' because counterfeit bills are circulating in Pyongsong. Not only using counterfeit money but merely possessing it is considered a criminal offense, and even those who simply possess it will be punished."

In fact, the reporting partner says they unknowingly received counterfeit money. How did they handle it?

"I used it secretly without reporting it. If it's detected when it comes back to you, wouldn't you suffer a loss? So everyone is trying to pass it on to someone else without reporting it."

When counterfeit money is reported, authorities simply confiscate it without providing replacement bills. In other words, honest reporting results in personal loss. As a result, counterfeit money continues to circulate. Since the state also suffers losses when the counterfeits eventually enter the treasury, authorities are desperately focusing on enforcement measures.

◆Large Quantities of Counterfeit Money Discovered Even in State-Owned Factories

Information about sophisticated counterfeit bills in circulation has been reported from various regions in northern North Korea since around November last year. However, authorities had not previously launched large-scale crackdowns like the current one.

According to the Hyesan reporting partner, an incident actually occurred where an accountant at a state-owned factory went to the bank to make a deposit.

"Among the money taken to the bank, 1.2 million won was counterfeit. The accountant was investigated by police and prosecutors, but this time it was determined that all the money had come through market transactions, so it seems they have issued a warning to the markets."
※As of early April, 1,000 North Korean won is approximately $0.0414. 1.2 million won is about $49.63.

It appears impossible to stop the circulation of counterfeit money. There are suggestions that for large transactions, bill sorting machines should be introduced or bank inspections should be conducted.