What’s preventing regimes like NK from withdrawing their foreign assets before they do controversial stuff, to stop them from being frozen?
In: 14
To what end?
The point of a foreign asset is that it’s an *asset* and allows you to buy and sell and trade foreign goods. Having millions of dollars of foreign money frozen in a bank in Switzerland means Switzerland won’t let you do anything with that money. If you withdraw all that money and convert it to your own currency… If no one will take your currency, you still can’t do anything with that money outside of your own country. And if your own country doesn’t have the things you want or need, having millions of dollars won’t help you. Kim Jong-Un can have eleventy quadsquillion NK dollarydoos to spend, but if there’s no oil in NK to buy then he can’t buy oil unless someone outside of NK is willing to take his dollarydoos. Even withdrawing the foreign money as physical cash that you hoard in a box in your own country won’t help you if no one is willing to do business with you, or if the ones that are willing don’t have the things you want or need.
Physical assets that are inherently valuable or useful like, say, big yachts absolutely *can* be withdrawn into your own country. However, a bunch of oligarchs suddenly taking all their expensive foreign toys into their own country or a more friendly country is a strong indicator of future shenanigans. That may give other countries time to prepare for whatever you’re about to do. Moving a bunch of money around is in itself shenanigans which may trigger the freezing of assets before you get around to doing the controversial thing, so you’re still stuck. That assumes that those things are mobile at all, and that you have the capability to get them out of there.
In any case, large chunks of money have their own kind of inertia. You’ve probably heard the term “liquid” assets, which refers to how easily the asset can be used or turned into something else. A pile of cash is very liquid – pretty much anyone will take it (under normal circumstances). A *BIG* pile of cash is less liquid, because banks don’t like moving large sums of money without doing a lot of verification and identification and proclamation of the emancipation. Physical cash still has to be physically moved, which takes effort. A big yacht is not very liquid because you need to [find someone who wants it](https://www.youtube.com/watch?v=sdi6E-qzS1c) who has enough money to buy it, and then you need to deliver it to them or otherwise transfer physical ownership, along with all of the typical bureaucracy that goes with that sort of thing. Real estate is even less liquid because you can’t physically move it at all, so unlike a yacht if you don’t find a buyer you can’t say, “Fine, I’ll just take it with me,” and your buyers are limited to the people who want real estate in that exact location.
The foreign assets of a regime are going to be a mixture of different levels of liquidity. Kim and Putin can’t just snap their fingers and empty a bank account – they have to track down all the different bank accounts and all the real estate and all the stocks and bonds and everything else, initiate transfers, find buyers, do paperwork… It’s going to take time. Their plans may not be able to accommodate that time.
Additionally, you may have to track down who actually controls the assets, if they’re being held by shell corporations controlled by lackeys controlled by flunkies controlled by sycophants controlled by political supporters, with each layer designed to shield you from liability or disguise that they’re your assets at all. Many of the foreign assets don’t belong to the regime at all, but are the property of rich oligarchs who presumably support the regime. The dictator himself might have all his ducks lined up and ready to go, but the people around him may not. Telling them to prepare might cause a leak of information so that word gets out about your plans. Or they might panic and withdraw too much, triggering premature freezes, or any number of other problems that arise whenever you introduce more people to a plan.
Where are they going to keep it?
No one’s going to convert it to gold and ship it to them (even if it was possible). Or convert to $100 bills? You’d need shiploads, and who’s going to print them for the North Korean regime?
See:
https://www.businessinsider.com/this-is-what-315-billion-worth-of-gold-looks-like-2012-12
https://www.wired.com/video/watch/this-is-what-250-billion-actually-looks-like
ELI5: all money is electronic these days; there are no physical things that they can “take back” and squirrel away.
Revenue is a tangled mess of money in, and money out. In order to liquidate or transport all NK assets in preparation for doing something, it would very quickly become very obvious that NK are withdrawing their assets. We’re talking about billions in a different industries – that’s easily noticed, especially considering there’s professionals whose jobs it is to look out for that sort of stuff.
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