North Korea rejects South's seductress spy claims

BEIJING (Reuters) - North Korea said on Wednesday a woman named by South Korea as a spy who seduced military officers to gain classified information was in fact a criminal on the run.

In its first response to the arrest of 34-year-old Won Jeong Hwa, North Korea's Committee for the Peaceful Reunification of the Fatherland said she was "a criminal who fled after committing crimes against the state and the people."

South Korea said Won, arrested in July, had passed information on weapons systems and the locations of key military facilities to the North. Her lover, a 26-year-old army captain, was also detained.

The North Korean statement, carried by the official news agency KCNA, described that claim as a "fabrication" and "grave provocation."

Ties between the two Koreas have chilled since South Korea's President Lee Myung-bak took office in February and angered the North by saying Seoul would stop what once had been a free flow of aid and link handouts to progress made by Pyongyang in nuclear disarmament.

On Wednesday, U.S. and Japanese media reported that the North had begun reassembling its Yongbyon nuclear reactor, which it had been dismantling since November in return for economic aid and political concessions, although the State Department in Washington later said it did not think this was so.

KCNA accused Lee of "frantically kicking up a confrontational racket" over the spy, adding that the accusations were "ridiculous enough to make even a cat laugh."

Won had been sentenced to six years prison and hard labor for fraud, swindling and theft in North Korea before defecting in 2001, KCNA said.

It called her stepfather, a fellow defector who was also detained by South Korea in conjunction with the spy case, "human scum who betrayed the homeland and the people."

(Reporting by Lucy Hornby; editing by Robert Hart)