Korean Nukes Linked to Japanese Pinball

Sunday, December 03, 2006

By CARL FREIRE, Associated Press Writer

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TOKYO — Gambling at pachinko was a lot more fun for Reiko Kuzuhara until she began to wonder whether maybe _ just maybe _ her losses were helping North Korea build nuclear weapons.

Pachinko, a form of pinball deeply loved in Japan, is an industry run by ethnic Koreans, and experts have long believed that the revenues are a vital source of hard currency for the impoverished regime in North Korea.

Now, as Kim Jong Il's nuclear weapons program gathers pace, Japan's attitude is hardening, and that includes shutting out the ferry on which money is believed to be hand-carried from Japan to North Korea.

"I really don't like that the money I spend could be helping them with those sorts of things," said Kuzuhara, 55, who works in the printing industry and was interviewed on a Tokyo street near several pachinko parlors. "It's making me think twice and cut back on how often I play."

The pachinko connection is facing increased scrutiny as tensions rise following North Korea's ballistic missile tests in July and its first test of a nuclear device on Oct. 9.

Pachinko is an upright pinball game played at tens of thousands of brightly lit parlors across the country. Success is measured in little steel payoff balls, which can be exchanged for cash or other prizes.

The machines rake in over $200 billion a year, some of which finds its way to North Korea. Official figures put the sum of remittances from sources in Japan at $25.5 million, but the bookkeeping is murky and some think the sum is closer to $850 million a year. No one knows how much of it derives directly from pachinko.

"It's very difficult to say how much cash is actually going from Japan to the North," said Toshio Miyatsuka, a North Korea specialist at Yamanashi Gakuin University in central Japan who has written a book about the pachinko industry.

"But it does seem certain that a lot of it is winding up in the hands of the North Korean government and military, and that includes money earned from drugs and pachinko," he added.

The Ministry of Finance only requires sums going to North Korea to be reported if they top $2.55 million in wire transfers or $85,120 in hand-delivered cash.

Japanese government records show that of $25.5 million sent from Japan to North Korea during the 2005 fiscal year, more than 90 percent was hand-delivered.

The banning of the Mangyongbong ferry from Japanese ports in July has almost certainly put a crimp in the cash flow.

Government officials, however, say it's hard to track money delivered through third countries, in person or through bank accounts. Cash from the drug trade traveling through Japan's underworld is likewise hard to monitor.

Officials in the pachinko industry say North Korea's image problems and the sanctions have not been a business issue.

While ethnic Koreans may worry about how relatives in the North are faring without the cash they used to take to them, their main concerns as businessmen lie elsewhere.

"Yes, there are a lot of ethnic Korean operators, but the industry is not at all concerned about the sanctions issue," said Takaaki Sasaki, spokesman for Zennichiyuren, an industry organization. "We're not hearing about anyone losing business because of the missiles or the nuclear test."

Still, the connection between pinball revenues and North Korea makes some Japanese pachinko players uneasy.

"I used to play frequently, but I don't go so often anymore," Kuzuhara said. "I really don't want North Korea using my money for bombs."

Copyright 2006 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

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