The 59-year-old man is alleged to have breached sanctions and is accused of dealing with weapons of mass destruction

The Australian federal police have arrested a man in Sydney over allegedly acting as an economic agent for North Korea, attempting to sell missile components and coal on the international black market.

Choi Han Chan, a 59-year-old man from Sydney’s Eastwood, allegedly breached United Nations sanctions and Australian federal law, and has been charged with brokering sales and discussing the supply of weapons of mass destruction.

The alleged deals involved entities in Indonesia, Vietnam and other undisclosed countries.

Choi is a naturalised Australian citizen of South Korean descent who had lived in Australia for about 30 years, Australian federal police (AFP) assistant commissioner Neil Gaughan told the media in Sydney on Sunday.

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Gaughan stressed there was no threat to Australians and that the man was not considered a “spy”.

“This man was acting as a loyal agent for North Korea who believed he was acting to serve some higher patriotic purpose,” he said.

“At the end of the day he would sell whatever he could to make money for the North Korean government.”

He said evidence suggested there had been contact “with high ranking North Korean officials” but he wouldn’t provide further details.

The AFP alleges Choi acted as a broker for the North Korean regime, unsuccessfully attempting to sell missile components – namely software for a guidance system – and technical expertise to unnamed international entities.

“We believe this man participated in discussions about the sale of missile componentry from North Korea to other entities abroad, as another attempt to try and raise revenue for the government of North Korea, in breach of sanctions.”

Gaughan would not identify the international entities or their location, but said there were no governments or government officials involved.

“This is black market 101,” he said.

At least two charges relate to an alleged attempt to transfer North Korean coal, misrepresented as Russian anthracite, to entities in Indonesia and Vietnam in breach of UN sanctions.

The man is also believed to have attempted to sell gemstones and other product.

Financial records indicated transfers of more than A$500,000 but if the alleged trades had been successful it would have raised “tens of millions” of dollars, Gaughan said.

The investigation began this year, triggered by information provided by a foreign law enforcement agency about a different matter.

Choi was arrested on Saturday morning at his home in the northern Sydney suburb of Eastwood, and later charged with six offences stretching from 2008 up to this year. Further charges have not been ruled out.

The case went before the Parramatta local court on Sunday morning. He was reportedly refused bail.

It’s the first time anyone in Australia has been charged with offences under the country’s Weapons of Mass Destruction Act, and the first time anyone has been charged specifically over alleged breaches of UN sanctions against North Korea.

The charges attract penalties of up to 10 years in prison.

The Australian prime minister, Malcolm Turnbull, congratulated the efforts of the AFP. He said he’d been briefed on the arrest on Saturday morning, and the charges were “of the greatest nature”.

“These are very serious matters,” he said. “It is vitally important that all nations enforce these sanctions.”

Efforts by North Korea to build its intercontinental ballistic missile capabilities have accelerated in recent months. This year alone has seen three long-range test launches.

The Australian government has repeatedly expressed its support for the US in opposition to the actions of the North Korean regime.

Citing the ANZUS treaty between Australia, New Zealand, and the US, Turnbull said in August that Australia would join the US in war.

“If there is an attack on the United States by North Korea, then the ANZUS Treaty will be invoked and Australia will come to the aid of the United States just as if there was an attack on Australia, the United States would come to our aid,” he said.

In October North Korean state media said Australia was “showing dangerous moves of zealously joining the frenzied political and military provocations of the US against DPRK”.

In response the Australian foreign minister, Julie Bishop, who had recently visited the demilitarised zone, dismissed the threat.

“North Korea’s threats only strengthen our resolve to find a peaceful solution to the rising tensions on the Korean Peninsula caused entirely by North Korea’s illegal, threatening and provocative behaviour,” she said.

The growing concerns about North Korea have been met with inconsistent messages from the US, particularly with mixed responses from the state department and the White House.

On Saturday the secretary of state, Rex Tillerson, appeared to stand by an offer of dialogue with North Korea, saying the US would “keep our channels of communication open”.

“As I said earlier this week, a sustained cessation of North Korea’s threatening behavior must occur before talks can begin. North Korea must earn its way back to the table,” he said at a ministerial meeting of the UN security council.