Southeast Asia online gaming and scam industries have been growing since at least 2010, but expansion in the Philippines, Cambodia, Myanmar and Laos was rapid from the mid-2010s, Cyber Scam Monitor (CSM), an independent monitoring group, told AGB.
In an interview with AGB, CSM underlined that ‘it is not an NGO and has no organizational affiliation’, being composed mainly of people from the human rights, anti-trafficking, academic, and media fields.
Due to the sensitive nature of the project, and the involvement of criminal elements and powerful state-linked actors in this industry, all contributors remain anonymous, with its operating team saying to have been motivated to create this platform after “several years of watching online crime networks take root and the stories of harrowing abuse expand across Southeast Asia”.
“We were motivated to create this platform after several years of watching online crime networks take root and expand in Southeast Asia, and as the scale of human rights abuses including human trafficking and forced labour in the cybercrime industries became increasingly apparent around 2020,” the group told AGB.
“We aim to disseminate information via social media and our website to inform the public, media, law enforcement, and policy makers, and to shine a light on the actors involved in illegal online gambling and cyber scams.”
According to CSM, Asia online gaming and scam industries have been growing since at least 2010, but expansion in the Philippines, Cambodia, Myanmar and Laos was rapid from the mid-2010s.
“From monitoring media reports, talking with former workers, and following Telegram groups used by industry actors, we can see that movement of workers between these countries has been common for much of this time,” the group warned.
“These industries are mobile, and when incidents occur, such as the crackdowns in northern Myanmar that began late last year, operations and workers move within and between countries.”
The Myanmar connection
Northern Myanmar has long been a site of illicit gambling activities, and in the 2000s issues emerged around casinos that catered to Chinese clients who travelled from Yunnan.
“As online gambling emerged and grew to prominence in the 2010s, it took root in Myanmar and began to receive attention as major developments emerged in the border areas with Thailand and Myanmar,” the group described.
According to CSM, although it is difficult to establish the extent to which gaming in Myanmar is fuelling crime elsewhere, there are ‘clearly linkages’ between countries in the region in what has become a transnational industry.
A Myanmar-based analysts recently told AGB, that Mekong River region has become a hub for illicit activities due to factors such as its proximity to the rapidly growing Chinese economy, emergence of casino centers catering to Chinese punters, and digital connectivity leading to online gambling and money laundering.
Recently, police in northern Myanmar arrested 10 phone and internet fraud suspects, accused of being ringleaders of the scam operations – and sent them to China in a highly publicized operation.
On January 23, more than 1,000 Chinese nationals were also arrested in Shan state’s Namhsan for alleged connection to scam centers, with about 44,000 people suspected of committing crimes have been handed over to China as a result of joint police action against online fraud in northern Myanmar.
“There have been numerous reports of people fleeing northern Myanmar to Laos and Cambodia, as well as other parts of Myanmar, since September last year. Arrests of alleged ringleaders in Thailand and Singapore have revealed ties to operations in Philippines, Myanmar and Cambodia,” CSM told AGB.
The same issues have been addressed in the most recent report by the United Nations Office on Drugs and Crime, which describes the alarming role of casinos, junkets, and cryptocurrency in driving the underground banking and money laundering infrastructure in East and Southeast Asia.
“The compounds and casinos hosting online gaming operators across the region also frequently host online fraud operators, and there is significant overlap in the physical and logistical infrastructure that maintains both,” CSM stated to AGB.
“Online gaming and scam operators depend on regional money laundering networks to move proceeds, and these networks work across countries and straddle both industries, helping conceal the source of funds and move it between countries.”
Philippines and Cambodia
According to CSM, in the Philippines, the only asian country where online gambling is legal and regulated, the industry has ‘come under fire in recent years due to its associations with criminality and has grown increasingly unpopular among the public’.
The association of the industry to criminal groups in the country targeting Chinese gamblers has also elicited a response from Beijing.
“This has long been a focus of frustration from Beijing, as it was established largely to target Chinese customers who are legally prohibited from gambling. Following restrictions from Beijing on its nationals being able to travel to the Philippines, as well as arrests of workers returning from the country, the workforce contracted significantly,’ CSM noted.
“China has also been more aggressive in blocking suspicious websites and money transfer platforms. A number of major raids last year were followed by tighter oversight from PAGCOR, and the industry is much smaller than it was a few years ago, but it is still significant.”
Meanwhile, in countries such as Cambodia where the industry is illegal, it has been much harder to gauge the real size of the industry in its underground form.
“However, there are still hundreds of websites online and active that clearly cater to Chinese clients, and message boards, social media accounts, and Telegram channels show the industry is still thriving across the region, with job opportunities posted frequently,” the group pointed out.
Governments playing catch up
The monitoring group conceded that in the past few years we have seen an uptick in law enforcement actions in Thailand and Malaysia, sporadic efforts in Cambodia, and decentralized crackdowns in Myanmar.
“Globally it is encouraging to see action by Interpol and US law enforcement, including blocking crypto wallets linked to cybercrimes, but so far these actions are a drop in the ocean, and online gaming and scams are multi-billion dollar industries. The issue has increasingly been elevated in bilateral and multilateral venues,” CSM noted.
However, it warned that one of the biggest impediments to addressing it is the reticence of law enforcement and governments in some of the countries hosting illegal online operations to take meaningful action.
“Even when we do see major actions take place, such as the crackdown that occurred in Cambodia in late 2022, after a period of police action, things go quiet for a period, then operators either relocate to more remote areas or just restart,” CSM pointed out.
“The criminal elements behind properties that host these operations are often either in business with local elite actors or enjoy their protection. Without meaningful action at the source, transnational law enforcement action will always be playing catch-up.”
