Crime Syndicates in Southeast Asia Go Global, Defying Crackdowns

Cyber crime syndicates that run multi-billion-dollar scam operations across Southeast Asia are still expanding despite recent law enforcement crackdowns, building links from Ireland to Mexico and reaching a potentially irreversible global spillover, the United Nations warned.

The transnational criminal networks are infiltrating and scaling up in other parts of the world, particularly in the Pacific region, Africa, South America and South Asia, the UN Office on Drugs and Crime said in a report published on Monday. They use trafficked workers from dozens of countries and are largely based in Myanmar, Cambodia and Laos.

The growth has been enabled by the rise of new, illicit online marketplaces, with such cryptocurrency-integrated platforms being used to launder money and connect illegal actors around the world, the agency said. It noted that there are now “hundreds of large-scale scam operations conservatively generating tens of billions of dollars” in annual profits.

“The dispersal of these sophisticated criminal networks within areas of weakest governance has attracted new players, fueled corruption, and enabled the industry to continue to scale,” the report said. The spillover effect has seen criminal groups now “free to pick, choose, and move jurisdictions, operations, and value as needed, with the resulting situation rapidly outpacing the capacity of governments to contain it.”

Even as Southeast Asian governments have stepped up crackdowns in recent months on scam compounds along shared land borders, the industrial-scale operations have simply adapted by moving to more remote locations within or beyond the region, or pivoting to online platforms.

“Another adaptation that has been noted across the region is the shift from land-based internet connection to Starlink,” the report stated, referring to Elon Musk’s satellite internet provider. That’s sometimes the result of operators moving to locations without online access or due to governments shutting down illegal cross-border connections, it added.

The UN agency estimated that countries in East and Southeast Asia lost up to $37 billion to cyber fraud in 2023. It said US authorities reported billions of dollars of losses the same year from crypto-related scams and “pig butchering” schemes, in which fraudsters gain the confidence of victims.

Crime syndicates in Southeast Asia are also actively enhancing collaboration with other major criminal networks around the world, including South American drug cartels, the Italian mafia, and the Irish mob, according to the UN. It cited the example of a network with Chinese links that helped Mexican drug cartels launder money and then resell those foreign currencies to overseas buyers within underground banking markets.

To scale the operations, the criminals also need hundreds of thousands of trafficked victims and complicit individuals to work in the scam compounds. People from as many as 56 origin countries have been identified as victims in the UN report, with the majority constituting Asian and African nations.

Photograph: Computer code displayed on screens arranged in Danbury, U.K., on Monday, Jan. 4, 2021. Photo credit: Chris Ratcliffe/Bloomberg