Sydney man Choi Han Chan allegedly used blackmarket contacts to broker deals in coal and iron, but also in weapons technology

A Sydney man charged over allegations he was a sanctions-busting “economic agent” of the North Korean regime attempting to sell ballistic missiles overseas has been refused bail.

Choi Han Chan, 60, is the first person ever charged under Australia’s Weapons of Mass Destruction (Prevention of Proliferation) Act.

Police have alleged Choi attempted to broker the sale of North Korean missiles and missile components internationally, and to sell coal and other resources from North Korea to entities in Indonesia and Vietnam.

It is alleged some of the missile components identified could be used in the delivery system for a weapon of mass destruction.

Bail was refused in the New South Wales supreme court in Sydney on Friday by Justice Julia Lonergan. The reasons for refusing bail are subject to a non-publication order.

Dressed in a grey jumper, Chan appeared via video link from Long Bay jail hospital. He appeared impassive throughout the hearing, and only sought to speak, through an interpreter, at the end of the hearing, when his microphone was turned off.

Choi, a naturalised Australian citizen of South Korean origin, was arrested in December 2017, after a raid on his home in the Sydney suburb of Eastwood. He has been in custody on remand since then.

Police allege he was acting as an “economic agent” for the Democratic People’s Republic of Korea, seeking to generate income for the isolated North Korean regime by selling weapons technology and resources, in breach of Australian and United Nations sanctions.

He has been charged with offences under the Charter of the United Nations Act and the Autonomous Sanctions Act, as well as the Weapons of Mass Destruction Act. The maximum penalty for these offences is 10 years’ imprisonment.

The Guardian has seen a police statement of alleged facts. These have not been tested in court and have not been agreed to by Choi’s defence.

The statement alleges Choi used a web of blackmarket contacts in Syria, Taiwan, Cambodia and Russia to broker deals mostly in coal and iron, but also in weapons technology, including short-range missiles.

The statement cites Choi’s regular overseas travel, including to North Korea, and alleged email correspondence that reveals a declared loyalty to the North Korean regime. An email allegedly from the regime praised Choi’s devotion and willingness to “work hard for our country”.

“Even when you are far away from our country, in your heart there is the country, so I am certain that your project will run successfully,” the email, sent in July 2013, allegedly said of Choi.

The police statement alleges Choi, who used the pseudonym Solomon in his negotiations, developed a code to discuss weapons sales on the phone, referring to missiles as “pine trees” and missile factories as “nurseries”.

When Choi was arrested, Australian federal police assistant commissioner Neil Gaughan stressed Choi was not alleged to have engaged in syping, but simply to have tried to raise money for the North Korean regime.

Gaughan said evidence suggested Choi had been in contact “with high-ranking North Korean officials” but did not provide details.

“We believe this man participated in discussions about the sale of missile componentry from North Korea to other entities abroad.”

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

According to the police allegations, Choi described himself as North Korea’s “international commerce” liaison, working on behalf of the highest echelons of the DPRK government.

“I am a recognised strategist that has favour with Kim Jong Eun [sic],” he wrote.

Police allege the various deals Choi attempted to broker did not go ahead.

The police allegations state that in late 2017 Choi brokered the sale of missiles and missile technology with a Taiwanese contact. They also state that he negotiated to send experts to the contact to help operate the technology. But the alleged deal was disrupted by “machinations internal to the DPRK” and had been abandoned prior to his arrest.

Correction: This article was amended on Sunday 20 October 2019 to clarify allegations around the timing of the proposed missile negotiations and Choi’s arrest.