Kansas City, Kansas — A man who officials say worked for one of North Korea’s military intelligence agencies has been indicted for his alleged involvement in a conspiracy to hack American health care providers, federal prosecutors announced Thursday.

A grand jury in Kansas City, Kansas, indicted Rim Jong Hyok, who is accused of laundering ransom money and using the money to fund additional cyberattacks on defense, technology and government entities around the world. The hack on American hospitals on other health care providers disrupted the treatment of patients, officials said.

“While North Korea uses these types of cybercrimes to circumvent international sanctions and fund its political and military ambitions, the impact of these wanton acts have a direct impact on the citizens of Kansas,” said Stephen A. Cyrus, an FBI agent based in Kansas City.

Online court records do not list an attorney for Hyok.

Justice Department officials said an attack on a Kansas hospital, which they did not identify, happened in May 2021 when hackers encrypted the medical center’s files and servers. The hospital paid about $100,000 in Bitcoin to get its data back.

The department said it recovered that ransom as well as a payment from a Colorado health care provider affected by the same Maui ransomware variant.

The Justice Department has brought multiple criminal cases related to North Korean hacking in recent years, often alleging a profit-driven motive that differentiates the activity from that of hackers in Russia and China.

In 2021, for instance, the department charged three North Korean computer programmers in a broad range of global hacks, including a destructive attack targeting an American movie studio, and in the attempted theft and extortion of more than $1.3 billion from banks and companies.

Investigators said Hyok has been a member of the Andariel Unit of the North Korean government’s Reconnaissance General Bureau, a military intelligence agency. Hyok allegedly conspired to use ransomware software to conduct cyberespionage hacks against American hospitals and other government and technology entities in South Korea, and China.
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Taipei, Taiwan — China hosted a series of high-profile diplomatic meetings this week aimed at projecting an image as a global peacemaker in two major global crises, the Russia-Ukraine war and the conflict between Israel and Hamas. 

Ukraine’s Foreign Minister Dmytro Kuleba met with Chinese Foreign Minister Wang Yi in the southern city of Guangzhou, his first trip to China since Russia invaded Ukraine in February 2022. In Beijing, China hosted a meeting that resulted in the signing of an agreement among 14 Palestinian factions to form a national unity government.

Analysts say the developments, while significant, were largely symbolic. 

“These diplomatic efforts are in line with the Global Security Initiative that Beijing is trying to put out to make itself look like a global peacemaker, but the international community needs to see some substantive progress [from China,]” Ian Chong, a political scientist at the National University of Singapore, told VOA by phone. 

China dubbed the agreements between representatives from 14 Palestinian factions, including Hamas and Fatah, as the “Beijing Declaration.” On Tuesday, Wang Yi said that while reconciliation is an internal affair of Palestinian factions, it could not be achieved “without the support of the international community.”

He also laid out China’s three-step approach to help end the ongoing conflict between Israel and the Palestinian militant group Hamas, including promoting a comprehensive and sustainable ceasefire, upholding the principle of “the Palestinians governing Palestine,” and promoting Palestine to become a full member of the United Nations as well as implementing the two-state solution.

The United States has made its own concerted attempts to achieve an Israel-Hamas ceasefire, laying out conditions intended to lead to the release of all remaining hostages held by Hamas in return for a permanent ceasefire and the pullout of Israeli forces from Gaza.

Although Wang tried to use the meeting in Beijing to cast China as a potential mediator in ending the Middle East conflict, Israel quickly denounced the declaration. The United States voiced its objection to Hamas’ involvement in the post-war governance of Gaza, noting it has designated the group as a terrorist organization.

Some experts say that without the support of the U.S. and other countries, China’s efforts to facilitate peace talks in the Middle East could all be in vain. 

“Despite China’s intention to be a peacemaker and mediator, without the support of the United States and other countries, China won’t be able to achieve much,” said Zhiqun Zhu, an expert on Chinese foreign policy at Bucknell University. 

Despite pushback from Israel and the U.S., Chong in Singapore said Beijing’s outreach to Palestinians could boost its standing in the Muslim world. 

“Beijing wants to seem like it is supporting the Palestinian cause, which has broad sympathy among Muslims and this dovetails with investment and efforts to advance Saudi-Iranian reconciliation,” he told VOA. 

Last year, China brokered a deal between Iran and Saudi Arabia that paved the way for the two Middle East rivals to restore diplomatic ties and reactivate a security cooperation agreement.

In his view, China’s efforts stand as a “contrast” to what some observers see as destructive U.S. actions, from Washington’s support for Israel to the U.S. experiences with Iraq, Afghanistan, and Syria. 

“Beijing is trying hard to look constructive and supportive to causes that many Muslims and Arab states care about,” Chong noted. 

A window of opportunity in Ukraine war

China’s hosting of Ukraine’s Foreign Minister Dmytro Kuleba this week was also an important diplomatic milestone for Beijing, which has faced persistent criticism over its support for Russia. Beijing has refused to condemn Russia’s invasion of Ukraine. 

During a meeting with Chinese Foreign Minister Wang Yi on Wednesday, which lasted more than three hours, Kuleba said “a just peace” in Ukraine is in China’s strategic interests and that Beijing’s role as “a global force for peace” is important.

He also said Kyiv is ready to negotiate when Russia is ready to do so in good faith, adding that Ukraine hasn’t sensed any sign of readiness from the Russians. 

In response, Wang Yi said China remains committed to a political settlement of the “Ukraine crisis” and reiterated four principles put forward by Chinese President Xi Jinping as well as the six understandings proposed by China and Brazil in May to help find a solution to end the Ukraine war.

Zhu, the China foreign policy scholar at Bucknell University, said a potential victory by former president Donald Trump in the U.S. presidential election could mean reduced support for Ukraine from Washington, making it “imperative” for Kyiv to reach out to China. 

“If Trump wins the U.S. election, Ukraine will basically be left to itself, so getting support and help from China is critical for Ukraine moving forward,” he told VOA in a written response. 

Building blocks for an alternative world order

Sari Arho Havren, an associate fellow at the Royal United Services Institute in Brussels, said China’s diplomatic efforts are part of the “building blocks” to help establish an alternative world order led by China. 

“China sees an opportunity to weaken the United States’ global position through its diplomatic efforts this week, and countries in the Global South are an important audience [for its messaging,]” she told VOA by phone. 

Zhu said as the U.S. becomes more preoccupied with November’s presidential election, there may be more opportunities for China to present itself as an alternative leader in global affairs. 

“The messier the U.S. elections are and the more isolationist the U.S. becomes, the more opportunities China will have to fill in the gap and play a leadership role in international affairs,” he told VOA. 

However, if China hopes to become a more important international player through these diplomatic efforts, Chong said Beijing needs to follow up on the more declaratory agreements by rolling out some concrete steps. 

“I suppose China has ambitions to become a more important player [internationally,] but those ambitions haven’t been matched by developments on the ground yet,” he said.
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JEFFERSON CITY, Mo. — As state treasurer, Vivek Malek pushed Missouri’s main retirement system to pull its investments from Chinese companies, making Missouri among the first nationally to do so. Now Malek is touting the Chinese divestment as he seeks reelection in an August 6 Republican primary against challengers who also are denouncing financial connections to China.

The Missouri treasurer’s race highlights a new facet of opposition to China, which has been cast as a top threat to the U.S. by many candidates seeking election this year. Indiana and Florida also have restricted their public pension funds from investing in certain Chinese companies. Similar legislation targeting public investments in foreign adversaries was vetoed in Arizona and proposed in Illinois and Oklahoma.

China ranks as the world’s second-largest economy behind the U.S.

Between 2018 and 2022, U.S. public pension and university endowments invested about $146 billion in China, according to an analysis by Future Union, a nonprofit pro-democracy group led by venture capitalist Andrew King. The report said more than four-fifths of U.S. states have at least one public pension fund investing in China and Hong Kong.

“Frankly, there should be shame — more shame than there is — for continuing to have those investments at this point in time,” said King, who asserts that China has used intellectual property from U.S. companies to make similar products that undercut market prices.

“You’re talking a considerable amount of money that frankly is competing against the U.S. technology and innovation ecosystem,” King said.

But some investment officials and economists have raised concerns that the emerging patchwork of state divestment policies could weaken investment returns for retirees.

“Most of these policies are unwise and would make U.S. citizens poorer,” said Ben Powell, an economics professor who is executive director of the Free Market Institute at Texas Tech University.

The National Association of State Retirement Administrators opposes state-mandated divestments, saying such orders should come only from the federal government against specific companies based on U.S. security or humanitarian interests.

The U.S. Treasury Department recently proposed a rule prohibiting American investors from funding artificial intelligence systems in China that could have military uses, such as weapons targeting. In May, President Joe Biden blocked a Chinese-backed cryptocurrency mining firm from owning land near a Wyoming nuclear missile base, calling it a “national security risk.”

Yet this isn’t the first time that states have blacklisted particular investments. Numerous states, cities and universities divested from South Africa because of apartheid before the U.S. Congress eventually took action. Some states also have divested from tobacco companies because of health concerns.

Most recently, some states announced a divestment from Russia because of its war against Ukraine. But that has been difficult to carry out for some public pension fund administrators.

The quest to halt investments in Chinese companies comes as a growing number of states also have targeted Chinese ownership of U.S. land. Two dozen states now have laws restricting foreign ownership of agricultural land, according to the National Agricultural Law Center at the University of Arkansas. Some laws apply more broadly, such as one facing a legal challenge in Florida that bars Chinese citizens from buying property within 16 kilometers of military installations and critical infrastructure.

State pension divestment policies are “part of a broader march toward more confrontation between China and the United States,” said Clark Packard, a research fellow for trade policy studies at the libertarian Cato Institute. But “it makes it more challenging for the federal government to manage the overall relationship if we’ve got to deal with a scattershot policy at the state level.”

Indiana last year became the first to enact a law requiring the state’s public pension system to gradually divest from certain Chinese companies. As of March 31, 2023, the system had about $1.2 billion invested in Chinese entities with $486 million subject to the divestment requirement. A year later, its investment exposure in China had fallen to $314 million with just $700,000 still subject to divestment, the Indiana Public Retirement System said.

Missouri State Treasurer Malek tried last November to get fellow trustees of the Missouri State Employees’ Retirement System to divest from Chinese companies. After defeat, he tried again in December and won approval for a plan requiring divestment over a 12-month period. Officials at the retirement system did not respond to repeated questions from The Associated Press about the status of that divestment.

In recent weeks, Malek has highlighted the Chinese divestment in campaign ads, asserting that fentanyl from China “is drugging our kids” and vowing: “As long as I’m treasurer, they won’t get money from us. Not one penny.”

Two of Malek’s main challengers in the Republican primary — state Rep. Cody Smith and state Sen. Andrew Koenig — also support divestment from China.

Koenig said China is becoming less stable and “a more risky place to have money invested.”

“In China, the line between public and private is much more blurry than it is in America,” Smith said. “So I don’t think we can fully know that if we are investing in Chinese companies that we are not also aiding an enemy of the United States.” 

A law signed earlier this year by Florida Gov. Ron DeSantis requires a state board overseeing the retirement system to develop a plan by September 1 to divest from companies owned by China. The oversight board had announced in March 2022 that it would stop making new Chinese investments. As of May, it still had about $277 million invested in Chinese-owned entities, including banks, energy firms and alcohol companies, according to an analysis by Florida legislative staff.

Florida law already prohibits investment in certain companies tied to Cuba, Iran, Sudan, Venezuela, or those engaged in an economic boycott against Israel.

In April, Arizona Gov. Katie Hobbs vetoed a bill that would have required divestment from companies in countries determined by the federal government to be foreign adversaries. That list includes China, Cuba, Iran, North Korea, Russia and Venezuela.

Hobbs said in a letter to lawmakers that the measure “would be detrimental to the economic growth Arizona is experiencing as well as the State’s investment portfolio.” 
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