China and the United States have joined forces to track Chinese companies suspected of funding North Korea's nuclear program and financially aiding Kim Jong-un's regime.

Washington and Beijing are currently zeroing in on the finances of a large company owned by a Communist Party member, who US President Barack Obama said has been financially supporting Pyongyang's expansion of its nuclear arsenal.

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Hongxiang Industrial Development Co. is the target of joint US-China investigations for allegedly aiding North Korea's nuclear program.

Investigation

The investigation is considered the most important collaboration between the two nations to hunt Chinese companies and businesspeople financing Kim Jong-un's nuclear program.

Earlier this month, North Korea launched its fifth missile test prompting the US and the international community to call on China to slap painful sanctions on the isolated nation.

US lawmakers passed a law this year which requires Washington to impose heavy sanctions on Chinese companies engaged in business with the North Korean government.

Hongxiang Industrial

The Chinese police have started investigating Ma Xiaohong, owner of Hongxiang Industrial, for allegedly being involved in "serious economic crimes" in the course of his company's trading activities with the North.

High-ranking Chinese financial officials said they have frozen the assets of Ma as well as those of her business associates and relatives, who are believed to have also been offering financial support to North Korea.

According to US officials, prosecutors from the US Department of Justice alerted Chinese authorities about the criminal activities of Ma and her company, Hongxiang Industrial, last month.

The prosecutors said there is enough evidence to pin Ma and her company for aiding North Korea's nuclear program and helping Kim evade UN sanctions.

Financial sanctions

U.S. officials on Saturday welcomed China's cooperation in investigating Ma and her associates although they said Beijing could do more to rein in Pyongyang by imposing diplomatic and financial sanctions on the belligerent state.

The US has been putting pressure on China to "reverse the course" on Pyongyang following Kim's latest missile launch.

President Obama said Beijing "bears the responsibility" for reining in North Korea and halting its missile tests given its influence over Kim's government.

North Korean refugees

Analysts say it is highly unlikely that Beijing would slap severe sanctions on the North citing the grim scenarios it will face if the Pyongyang government collapses.

Analysts have said that if the North Korea regime collapses, Beijing could face a humanitarian crisis with North Korean refugees thronging to China.

The US and South Korea have agreed to deploy the Terminal High Altitude Area Defense (THAAD) anti-missile system to Korea to counter Pyongyang's missile tests despite China's vehement opposition.

China has repeatedly said that the THAAD deployment would jeopardize the security in the Korean Peninsula and could be used against China. 

TagsNorth Korea nuclear program, missile tests, US-China investigations, Chinese Firms, Korean peninsula, North Korea, South Korea, Washington, china, Hongxiang Industrial Development Co.