This article was first published by Pacific Forum. It is republished with permission.
When Presidents Donald Trump and Xi Jinping meet on the side of the Asia-Pacific Economic Cooperation (APEC) forum in South Korea, there will be much on their agenda, including trade, Taiwan and Ukraine. And also, according to US Treasury Secretary, Scott Bessent, fentanyl.
But paired with fentanyl, the Southeast Asian scam centers in Cambodia, Laos and Myanmar should be prioritized, not just because some of them traffic in illicit precursor chemicals for fentanyl but also because all are engaged in trafficking of people and stealing the savings of ordinary Chinese, Americans and others around the globe. Working together will be far more effective than working separately.
Unlike the case of fentanyl, in which the majority of victims have been Americans, so far those scam centers mainly traffic Asians as slave labor, and have targeted Asians with their fraud schemes – although they’re rapidly expanding their reach.
They evolved from gambling casinos run by overseas Chinese that catered to Chinese, since gambling was prohibited in mainland China.
Some years ago, they turned toward the lucrative scamming business. As China strengthened its defenses against cyber fraud and closed operations immediately along its borders, they shifted farther south and toward new opportunities.
For manpower they deceptively advertise high-paying jobs on social media. The people who are attracted often find themselves deprived of passports, subject to extreme abuse and consigned to roles abetting some of the world’s most vicious criminals.
The industry received unwanted attention in January after a young Chinese actor disappeared from Bangkok while pursuing a seemingly lucrative gig. His girlfriend raised the alarm on Chinese social media, resulting in an enormous outcry and threatening to tank Chinese tourism to Thailand. Unlike their response in most other cases, the Thai police quickly located and rescued the actor. Feeling the heat, a local Myanmar minority army “liberated” several thousand others held by the scammers.
After the publicity died away and the Thais had turned off cross-border power and internet services, the largest Myanmar scam center, Shwe Kokko, was soon reported back in business using generators and Starlink connections. A recent raid by the Myanmar authorities netted 30-some Starlink devices (resulting in Starlink disabling 2,500 more) and the arrest of thousands of foreign cybercriminals. Over 1,000 workers in the scam operations fled to Thailand, most of them Chinese, Indians and Southeast Asians.
But strife-torn Myanmar is not the center of the industry. It lies in Cambodia where there is excellent internet connectivity and the industry enjoys political connections and some protection through state-exercised sovereignty.
The torture and death of a young Korean whose body was discovered in Cambodia in August inflamed Korean public sentiment and brought the repatriation of dozens of Koreans. Many were willingly scamming and those have been criminally charged, but others had been kidnapped and forced to work.
Koreans, however, are only a small segment of the perhaps 200,000 people working in Cambodian scam centers. While dealing with the problem, Korea has tried gingerly not to damage its diplomatic relations with Cambodia.
Emboldened by their profits, the scammers have widened operations. International counter-measures have been fragmented, reactive and episodic. Without a vigorous, sustained and truly international effort, this ruthless industry will only grow.
Because the original perpetrators as well as labor and targets have been Chinese, China has been the nation most focused on counter-measures, but its efforts are mainly designed to protect its own citizens while not undercutting diplomatic relations with the host countries. In the process, they have tended to target lower-level criminals and encourage the scammers to look for less well-defended countries.
One such country is the United States, which until recently had not paid much attention. A July report by a US Congressional commission found US defenses “fragmented and under-resourced.” But while most of the estimated $50-75 billion scam take still come from Asia, some $10 to 12.5 billion in 2024 may have come from the US. Unless addressed, this will inevitably become a much larger American problem.
Thus, China and the US have a responsibility to their own citizens and the world to work as co-leaders of a sustained campaign against scammers and illicit drug dealers, encompassing both the fraud and fentanyl issues.
It will require strong national counter-scam institutions and the coordination within and across governments of agencies charged with intelligence, enforcement, and financial tracking and regulation. Just as in the case of money laundering, the campaign needs a laser focus on the big fish and their enablers – even if the enablers are government officials – rather than small fry.
If led at the highest levels by China and the US, the international effort should be multinational with countries such as Thailand, Singapore, Australia, Canada and Mexico also deeply involved and committed. It thus makes sense to start this effort on the side of APEC since so many APEC economies are relevant.
It will take a strong commitment of political will to be proactive and swing the momentum toward the side of closing down an industry that in only a few years has trafficked tens of thousands of people, is protected by lack of effective governance or complicit governance, and which is bilking millions of victims around the world of tens of billions of hard-earned cash. Closing these cruel, criminal operations should certainly be worthy of a Nobel Prize.
Charles Morrison (Charles.E.Morrison@EastWestCenter.org) is a senior fellow and former president of the East-West Center.
