A British tobacco company has agreed to pay more than $629 million to settle allegations that it did illegal business with North Korea in violation of U.S. sanctions, the Justice Department said Tuesday.

British American Tobacco, one of the largest tobacco companies in the world, entered into a deferred prosecution agreement with the Justice Department, while the company’s Singapore subsidiary pleaded guilty to conspiring to commit bank fraud and violate sanctions.

The London-based BAT said in its own statement that the settlement concerns sales from 2007 through 2017 and that the company has since taken steps to improve its business practices.

North Korea faces stringent U.S. and international sanctions going back nearly two decades for its nuclear weapons program and development of intercontinental ballistic missiles. Pyongyang has continued to research and test more nuclear weapons. It has also worked to evade sanctions with the cooperation of allies like China and illicit trade with barred countries and companies.

Smuggled tobacco products are regarded as a major source of revenue for North Korea's nuclear and weapons of mass destruction programs, the Justice Department said.

The penalty is the largest arising from North Korea sanctions violations in the Justice Department's history, said Assistant Attorney General Matthew Olsen.

“This case and others like it do serve as a warning shot to companies, companies that support rogue regimes like North Korea through their activities — that they have to have compliance programs, compliance programs that prevent these kinds of activities from taking place,” he said.

BAT admitted as part of the settlement that it continued to do tobacco business in North Korea despite stating publicly in 2007 that it no longer had operations with the repressive regime. Prosecutors say a third-party company operating under the control of a BAT subsidiary sold more than $400 million in tobacco products between 2007 and 2017.

That money was then funneled back to BAT, the Justice Department said. North Korean purchases of the tobacco occurred through front companies that concealed the connections from U.S. banks that processed the transactions.

In a statement, BAT chief executive Jack Bowles said the company regrets “the misconduct arising from historical business activities that led to these settlements, and acknowledge that we fell short of the highest standards rightly expected of us.”

He said the company, whose brands include Lucky Strike, Kent and Pall Mall, had since transformed its ethics and compliance programs.

Separately, federal prosecutors disclosed a cigarette trafficking scheme that raised money for North Korea’s nuclear weapons program, announcing charges against three men — a North Korean banker and two Chinese facilitators. The State Department has announced a reward for information leading to their arrest.

British American Tobacco agreed in 2017 to take over Reynolds American Inc., which owned brands like Newport and Camel, creating the world's largest publicly traded tobacco company.

Share:
More In Business
Michigan Judge Sentences Walmart Shoplifters to Wash Parking Lot Cars
A Michigan judge is putting sponges in the hands of shoplifters and ordering them to wash cars in a Walmart parking lot when spring weather arrives. Genesee County Judge Jeffrey Clothier hopes the unusual form of community service discourages people from stealing from Walmart. The judge also wants to reward shoppers with free car washes. Clothier says he began ordering “Walmart wash” sentences this week for shoplifting at the store in Grand Blanc Township. He believes 75 to 100 people eventually will be ordered to wash cars this spring. Clothier says he will be washing cars alongside them when the time comes.
State Department Halts Plan to buy $400M of Armored Tesla Vehicles
The State Department had been in talks with Elon Musk’s Tesla company to buy armored electric vehicles, but the plans have been put on hold by the Trump administration after reports emerged about a potential $400 million purchase. A State Department spokesperson said the electric car company owned by Musk was the only one that expressed interest back in May 2024. The deal with Tesla was only in its planning phases but it was forecast to be the largest contract of the year. It shows how some of his wealth has come and was still expected to come from taxpayers.
Goodyear Blimp at 100: ‘Floating Piece of Americana’ Still Thriving
At 100 years old, the Goodyear Blimp is an ageless star in the sky. The 246-foot-long airship will be in the background of the Daytona 500 — flying roughly 1,500 feet above Daytona International Speedway, actually — to celebrate its greatest anniversary tour. Even though remote camera technologies are improving regularly and changing the landscape of aerial footage, the blimp continues to carve out a niche. At Daytona, with the usual 40-car field racing around a 2½-mile superspeedway, views from the blimp aptly provide the scope of the event.
Is U.S. Restaurants’ Breakfast Boom Contributing to High Egg Prices?
It’s a chicken-and-egg problem: Restaurants are struggling with record-high U.S. egg prices, but their omelets, scrambles and huevos rancheros may be part of the problem. Breakfast is booming at U.S. eateries. First Watch, a restaurant chain that serves breakfast, brunch and lunch, nearly quadrupled its locations over the past decade to 570. Fast-food chains like Starbucks and Wendy's added more egg-filled breakfast items. In normal times, egg producers could meet the demand. But a bird flu outbreak that has forced them to slaughter their flocks is making supplies scarcer and pushing up prices. Some restaurants like Waffle House have added a surcharge to offset their costs.
Load More