Asian organized crime groups have emerged as definitive market leaders in cyber-enabled fraud, money laundering and underground banking.
These syndicates have shown remarkable adaptability, exploiting changes in political and business environments, capitalizing on gaps in governance and regulations, and swiftly developing advanced physical and digital infrastructure to scale and expand their criminal enterprises, a new report by United Nations Office on Drugs and Crime (UNODC) says.
The report, released in April, sheds light on this rapidly changing landscape. It details how these criminal networks have grown exponentially over the past years, driven in part of the rapid deployment of blockchain infrastructure, cryptocurrency tools, and other technologies that have made their illicit operations more resilient, more efficient, and harder to detect.
The proliferation of scam centers in Southeast Asia
Criminal groups across Southeast Asia, often originating from China, are notorious for running industrial-scale cyber-enabled fraud and sprawling scam centers. According to the UNODC, these sophisticated networks operate hundreds of large-scale scam centers in the region, generating nearly US$40 billion in annual profits.
In Southeast Asia, scam centers are primarily concentrated in border zones and special economic areas in Cambodia, Myanmar, and Laos. They function by trafficking individuals, often deceived by false job offers.
Once inside, victims are held under coercive conditions and made to work in guarded facilities with limited freedom, facing abuse or torture if they try to resist or escape. The forced labor involves conducting online scams, such as cryptocurrency fraud, romance scams, or fake investment schemes, targeting victims around the world.
Since at least 2023, a sweeping regional crackdown has targeted these criminals networks, with key efforts including joint law enforcement actions, military operations, and cross-border cooperation, leading to the arrest and deportation of tens of thousands of individuals, many of them Chinese nationals. Chinese authorities report that over 53,000 Chinese nationals, including trafficking victims, have so far been repatriated from scam compounds in northern Myanmar alone.
In a recent operation, around 7,000 people were released from scam centers along the Myanmar-Thailand border. The rescued individuals, representing about 20 nationalities spanning Asia and Africa, reported horrific abuse, including torture, ransom demands, and organ trafficking threats.
The UN estimates that around 100,000 people from more than 50 countries remain trapped in these compounds.
A mobile and resilient industry
Despite growing enforcement efforts, Southeast Asia’s cybercrime industry remains deeply resilience. These operations frequently relocate, rebrand, or disperse into smaller cells to evade disruption. Even when there is disruption to the infrastructure and services they depend on, such as Internet connection or power supply, these groups find workarounds to maintain their activities.
For example, in 2019, when Cambodia announced a ban on online gambling, and in 2022, when it launched a series of raids focusing on Sihanoukville, large numbers of people left the coastal city, resulting in the temporary closure and abandonment of many operations temporarily ceased. However, this disruption was short-lived, with criminal groups quickly migrating to other parts of the country, as well as to Myanmar and Lao.
Similarly, upticks in law enforcement operations in Lao triggered a shift in operations, with many criminal enterprises and trafficked workers relocating to Myanmar and Cambodia.
Meanwhile, in Cambodia’s Koh Kong province as well as areas bordering Thailand and Vietnam, existing sites continue to expand, in addition to new hubs being constructed. Similar trends are observed in Myanmar where major crime sites are also expanding, with indication of new sites being developed as well, particularly south of Myawaddy.
Professionalization through technology
Southeast Asia’s booming cyber-enabled fraud landscape is being fueled by the emergence of sophisticated illicit online marketplaces, particularly on Telegram. These marketplaces, which are often connected to parallel cryptocurrency exchanges controlled by the same entity, host a wide range of merchants specializing in the sale of stolen data, hacking tools, malware, and various underground banking, money laundering and cybercrime services utilized by other criminals.
They are run by some of the region’s most powerful criminal syndicates and facilitate the full stack of cyber-enabled fraud.
One of the most prominent marketplaces is Huione Guarantee. Now rebranded as Haowang, the platform is the world’s largest illicit online marketplaces by users and transaction volume, serving as a center pillar of Southeast Asia’s cyber-enabled fraud ecosystem. Functioning as a one-stop-shop for cybercriminals, it provides the technology, infrastructure, and resources needed to conduct cyber-enabled fraud and cybercrime, as well as evade sanctions under UN Security Council Resolutions.
The predominantly Chinese-language platform was founded as an extension of the Huione Group of companies headquartered in Phnom Penh, Cambodia, and has grown to more than 960,000 users and thousands of interconnected vendors.
According to Elliptic estimates, wallets linked to Huione Guarantee and its vendors have received at least US$24 billion in cryptocurrency since 2021. An additional US$6 billion has flowed through a Telegram bot used primarily for online gambling on Huione Guarantee, further underscoring the platform’s scale and prominence.
Â
Featured image credit: edited from freepik
