North Korean officials are to meet US diplomats, Treasury officers and Secret Service agents in rare talks in New York next week to discuss steps Pyongyang should take to abandon counterfeiting and money laundering activities for it to be integrated into the global financial system, officials said.

The two-day talks from Monday, convened at Pyongyang's request, will be "related to money laundering and other forms of illicit finance," a US State Department official told AFP, speaking on condition of anonymity.

It provides an opportunity for the two arch enemies "to address conduct by the DPRK (North Korea) that has affected its relationship with the US as well as its access to the international financial system," the official said.

North Korea, facing prolonged sanctions from the international community, will be represented at the talks by a six-member delegation led by Ki Kwang-ho, a director at Pyongyang's finance ministry, South Korea's Yonhap news agency reported.

The US team will be led by the Treasury's deputy assistant secretary Daniel Glaser, who was involved in previous protracted negotiations with Pyongyang over restrictions imposed -- and later lifted -- on North Korean accounts in a Macau bank.

"We think it's an opportunity to familiarize the North Koreans with accepted international banking practices and problems that have affected North Korean access to the international financial system," said State Department spokesman Sean McCormack, previewing the upcoming talks.

North Korea is currently in the process of declaring and disabling its nuclear weapons arsenal under the watchful eyes of US weapons experts as part of an international deal.

Under a six-party agreement involving the United States, China, the two Koreas, Russia and Japan, the North Koreans were given energy aid assurances as well as diplomatic and security guarantees in return for abandoning their nuclear weapons.

If North Korea fulfils all its obligations under the complex deal, including ending illicit financial activities, the United States would restore diplomatic relations and pave the way for Pyongyang to enter the World Bank and International Monetary Fund, officials said.

The presence of Secret Service agents at the talks next week points to discussions on US dollar counterfeiting, officials said.

Washington estimates that North Korean dictator Kim Jong-Il's regime pockets up to one billion dollars a year from counterfeiting of US greenbacks, trafficking illicit narcotics, smuggling contraband tobacco and even peddling knock-off Viagra.

"It is the first government known to produce 'Monopoly money' since the Nazis, and is the world's premier counterfeiter of US currency," according to Peter Brookes, a former Pentagon official, whose latest book, "A Devil's Triangle: Terrorism, WMD and Rogue States," dwells partly on the "illicit" activities of North Korea.

The North Korean fake 100 US dollar bill, he said, was known as the "supernote" due to its quality, which far surpassed the paper that came out of the Latin American and Eastern European crime syndicates.

North Korea rejects counterfeiting charges.