Left I on the News

Hold your shock:

Charges by the U.S. Treasury Department that a small bank in Macau knowingly laundered counterfeit U.S. currency on behalf of North Korea have no basis in fact, according to a confidential audit ordered by the government of the Chinese enclave.

The audit, obtained by McClatchy News Service, also suggests that the Treasury overstated claims that the bank laundered "hundreds of millions" in ill-gotten gains through Banco Delta Asia.

The audit's conclusions about the laundering of counterfeit currency are significant because they cast doubt on Bush administration claims that North Korea has engaged in state-sponsored counterfeiting and introducing these fake bills via Banco Delta.

Moreover, the audit confirmed that the only time Banco Delta knowingly handled counterfeit U.S. notes was in 1994 when its inspectors discovered 100 counterfeit $100 bills and turned over $10,000 to local authorities. That $10,000 is far from the $15 million in counterfeit U.S. currency the Bush administration in 2005 said North Korea was manufacturing annually.

And how long has this been known (not to us, of course)?

Ernst & Young presented the audit to Macanese banking regulators in December 2005 in response to concerns raised in Treasury's Sept. 20, 2005, proposed action against Banco Delta.

For more than a year, hundreds of stories in the press have taken the U.S. claims of North Korea counterfeiting money as simple fact. And for essentially that entire time, it has been known that the story was simply untrue.