North Korean IT Worker Scheme Exposed

Two U.S. citizens have been sentenced to prison for their roles in a scheme to help the North Korean government place remote IT workers in American companies.

Fraudulent Scheme Exposed

On Wednesday, the U.S. Department of Justice announced the sentencing of Kejia Wang and Zhenxing Wang, both New Jersey residents. The two were accused of providing infrastructure for the fraudulent scheme, in particular for running or managing so-called “laptop farms” inside the U.S., which allowed North Koreans to connect to the laptops and appear like they were living and working in the country.

• The scheme netted North Korea around $5 million.
• It also involved co-conspirators stealing the identities of more than 80 Americans and obtaining work at more than 100 U.S. corporations, including some Fortune 500 companies.

“The ruse placed North Korean IT workers on the payrolls of unwitting U.S. companies and in U.S. computer systems, thereby harming our national security,” John A. Eisenberg, the DOJ’s assistant attorney general for National Security, was quoted as saying in the announcement.

Laptop Farms and Shell Companies

Prosecutors said that between 2021 and 2024, working with co-conspirators, Kejia oversaw the operation of laptop farms made of hundreds of computers, while Zhenxing hosted laptops at his home. The two also created shell companies with financial accounts linked to the fake IT workers to funnel payments amounting to millions of dollars, which were later transferred overseas.

• “In exchange for their services, Kejia Wang, Zhenxing Wang, and the four other U.S. facilitators received nearly $700,000 for their respective roles in the scheme,” read the DOJ's announcement.

Countermeasures

To counter this threat, some companies and recruiters have come up with inventive strategies, such as asking suspected North Koreans to insult Kim Jong-Un, which is illegal in the country.

• In a recent viral video of a job interview, the applicant can be seen fumbling after the interviewers asked him to say ““Kim Jong Un is a fat ugly pig.” He eventually hung up the call.

The North Korean Threat

This is the latest legal action against North Korea’s wide-ranging scheme that has allowed fake IT workers to be hired by hundreds of American and Western companies. Along with major crypto thefts worth more than $2 billion just last year, the North Korean government uses this type of fraud to fund its regime and weapons’ program, which is under heavy sanctions that isolates it from much of the world’s economy.