Scam centre workers and victims sit on the ground during a crackdown operation by the Karen Border Guard Force on illicit activity at the KK Park complex in Myawaddy, Myanmar, on 26 Feb 2025. (STR/AFP via Getty Images)
Despite Beijing’s pressure on Southeast Asian governments, selective crackdowns have barely slowed the expansion of scam centres in the region
By Jennifer Ng
The recent seizure of assets of China-born Chen Zhi in Singapore exposed the enormity of online investment scams in Southeast Asia. A report by the US revealed that the Chinese government’s selective crackdowns have allowed criminal networks in Southeast Asia to expand into large-scale scams, enabling China to gain a greater security footprint in the region.
Titled ‘China’s Exploitation of Scam Centres in Southeast Asia’, the report released by the US-China Economic Security Review Commission (USCC.gov) stated: “Beijing has selectively cracked down on scam centres that target Chinese victims, leading Chinese criminal organisations to conclude that they can make greater profits with lower risk by targeting citizens of wealthy countries such as the United States.”
The enormous scale of the Chinese criminal network came to light recently when the US and the UK jointly imposed sweeping sanctions on Oct 14 against Chen Zhi, a Chinese-born Cambodian national, his Cambodia-based company Prince Holding Group and his accomplices, for online investment scams targeting Americans and others worldwide. The US had described the sanctions as the “largest action ever targeting cybercriminal networks in Southeast Asia”.
About two weeks later on Oct 30, the Singapore Police Force (SPF) launched an island-wide enforcement operation against Chen and his accomplices. SPF seized six properties, bank accounts, securities accounts, cash, a yacht, 11 cars and multiple bottles of liquor, with a total estimated value of more than S$150 million or US$115 million. SPF has issued a Prohibition of Disposal Order on these assets.
Online investment scams account for the largest amount of scam losses suffered by Singaporeans. Telegram and Facebook were the most common platforms that scammers used to contact investment scam victims.
In 1H25, Singaporeans lost a total of $456.4 million to scams, out of which $145.4 million or 31.9% of the total amount was attributed to investment scams. Cryptocurrency losses made up a substantial share of scam losses, amounting to $81.6 million in 1H25—about 51.6% of all investment scam losses and 17.9% of total scam losses. SPF data shows that investment scam losses had increased from 28.8% in the preceding 12 months of 2024, when they totalled $320.7 million out of $1.1 billion.
Neak Oknha Chen Zhi, Chairman of Prince Holding Group ( princeholdinggroup.com)
1H25 breakdown of scam types in terms of amount lost (in millions). ( Singapore Police Force)
Chen also laundered the scam proceeds in several countries.
Besides Singapore, the sanctions led to the seizure of assets—including cash, bank deposits, luxury cars, yacht, expensive liquor, properties, shares and investment funds—in multiple countries: about US$61 million in South Korea, US$353 million in Hong Kong, US$150 million in Taiwan and US$145.6 million in the UK.
Yacht issued with Prohibition of Disposal Order by the Police. (Singapore Police Force)
The report said that Chinese criminal groups made tremendous profits through illegal casinos and online gambling targeting mainland Chinese during the early 2000s, but “after General Secretary of the Chinese Communist Party (CCP) Xi Jinping launched his anti-corruption campaign in 2012, many Chinese criminal organisations relocated their illicit gambling operations to Southeast Asia—particularly the Philippines, Cambodia, Laos and Burma (Myanmar)—outside the reach of Chinese law enforcement”.
However, mainland Chinese continue to lose money through these online scams. “According to Chinese reports, between January and August 2019, Chinese citizens lost more than $500 million to these scams.”
The report stated: “Beijing has placed intense pressure on governments in Southeast Asia to crack down on scam centres that target Chinese victims. Yet these selective crackdowns have done little to disrupt the increasing scale and scope of scam centres in the region.”
“As Beijing’s domestic crackdowns made it more difficult to target people in China, Chinese criminal groups increasingly focused on scamming non-Chinese victims in wealthy countries like the United States,” the report added.
Their scam operations have also diversified, according to the same report, which noted: “Chinese criminal organisations expanded their operations to focus more heavily on scamming, converting empty hotels and casinos into compounds dedicated to pig-butchering schemes and other forms of online fraud.”
To aid their scams of non-Chinese victims, the criminal organisations turned to human trafficking as their main source of labour, using fraudulent employment advertisements to lure large numbers of Indians who are conversant in English to target victims in the US and Europe.
The report noted that trafficked victims were forced to work in scam compounds under conditions observers have described as “modern slavery”.
On May 19, a group of UN experts released a joint statement warning that human trafficking tied to scam centres in Southeast Asia “has reached the level of a humanitarian and human rights crisis”.
The Office of the UN Commissioner for Human Rights estimated that 220,000 people from dozens of countries were held as forced labourers in scam centres in Cambodia and Burma in 2023.
“An expert working group convened by the United States Institute of Peace (USIP) estimated that pig butchering scams generated $63.9 billion in global revenue in 2023. Burma, Cambodia and Laos are currently the epicentre of scamming operations. Scam centres in these three countries produced approximately $43.8 billion in revenue in 2023, equivalent to about 40 percent of their combined official gross domestic product (GDP),” the report said.
The report also described how an 82-year-old American named Dennis committed suicide after losing his life savings through Chen’s online “pig butchering” scams, where scammers build personal relationships with victims over months (“fattening the pig”) before stealing all their money by convincing them to invest in fraudulent investment schemes (“slaughtering the pig”). A woman named “Jessie” connected with Dennis on Facebook, and the two built a close relationship over months of chatting, before Jessie convinced him to invest his savings in cryptocurrency. Jessie “disappeared” along with all of Dennis’ savings.
“US losses to online investment scams have steadily increased over the last several years, totalling over $16.6 billion. A US government estimate indicated that Americans lost at least $10 billion to Southeast Asia-based scam operations in 2024, a 66 percent increase over the prior year,” according to the press release on the sanctions on Chen’s criminal empire. It also said that Chen’s criminal network perpetrated a significant share of the scams and “remains a dominant player in Cambodia’s scam economy”, controlling “illicit financial flows of billions of dollars”.
Chinese Government Deepens Presence in Southeast Asia
The report stated that Beijing has used the issue of Chinese transnational criminal organisations “as an excuse to pressure Southeast Asian countries to agree to a greater role for Chinese security forces in the region”.
The report noted that in January, the Chinese government hosted a meeting of the Lancang-Mekong Law Enforcement Cooperation mechanism with representatives from Cambodia, Laos, Burma, Thailand and Vietnam, in which the parties agreed to strengthen intelligence sharing and joint operations to crack down on scam centres.
In September 2024, Cambodia’s Minister of Interior Sar Sokha travelled to Beijing and agreed to deepen joint law enforcement cooperation, particularly with regard to transnational crime.
Despite declarations by the Cambodian and Chinese governments to crack down on scam centres, there appears to have been no action taken against Chen, who has run some of the largest online investment scams in Southeast Asia since establishing Prince Holding Group in Cambodia in 2015.
The BBC reported that in 2020, Chen was awarded the highest title bestowed by Cambodia's king, that of “Neak Oknha”. It also reported that Chen was an official adviser to Cambodia's former prime minister Hun Sen, and now, prime minister of Cambodia Hun Manet, after he succeeded Hun Sen in 2023.
The report noted that Thailand, a US treaty ally that has long resisted Chinese police operations on its territory, has allowed Chinese security forces to operate within its borders.
“In late February, Thailand allowed high-level Chinese officials and Chinese security forces to participate in cross-border raids on scam centres in Burma that resulted in thousands of Chinese citizens being turned over to Chinese personnel in Thailand and repatriated to China on Chinese charter flights,” the report stated.
Beijing’s crackdowns in February appear to have been attempts to avoid publicity surrounding the human trafficking of Chinese citizens, after Chinese actor Wang Xing was abducted in Thailand in January and trafficked to a scam centre in Burma.
“He was quickly rescued by Thai authorities, but the case went viral on Chinese social media, along with discussions about the dangers of travelling to Thailand,” according to an Aljazeera report on February 21.
The report said Chinese tourist arrivals in Thailand reportedly fell by 33 percent, prompting then-Thai Prime Minister Paetongtarn Shinawatra to reassure Chinese tourists, vowing during her meeting with Xi in Beijing on February 6 to “strengthen law enforcement cooperation with China”.
“Numerous Thai academics and opposition Members of Parliament have argued that granting China such access violated Thailand’s sovereignty and sections of Thailand’s penal code prohibiting actions that undermine the independence of the state,” the report added.
Philippines’ Scam Centres Enable Chinese-state Espionage
Numerous reports have indicated that scam centres in the Philippines were likely linked to Chinese-state espionage efforts, the report stated.
Philippine offshore gambling operators (POGOs) are online gambling hubs serving the Chinese market.
The Philippine police raided the POGOS that serves as “fronts for scam centres” near Clark Air Base, a Philippine Air Force Base previously operated by the US, and Basa Air Force Base, one of the key bases to which the US has access under the US-Philippines Enhanced Defence Cooperation Agreement (EDCA).
The report said, “According to Philippine Senator Risa Hontiveros, there is persuasive information from the [Philippines] intelligence community showing that scam compounds have been used for surveillance and hacking activities.”
“Philippine authorities reportedly seized sophisticated listening equipment during raids on scam centres and found evidence of Chinese state-sponsored hackers operating out of scam compounds.”
The report also revealed that in February 2024, Philippine police raided what reports called “one of the largest scam hubs ever uncovered in the Philippines” that serves as "Chinese infiltration in the Philippines”, perpetrated by Alice Gou, former mayor of the rural town of Bamban north of Manila.
After her election as mayor in the Philippines in 2022, Guo granted a permit to Zun Yuan Technology to operate a POGO out of the compound.
Subsequent investigation by the Philippine authorities revealed that “Guo was a Chinese spy whose campaign for mayor was arranged by Chinese State Security”. Guo is a Chinese national named Guo Huaping who moved to the Philippines as a child and later obtained a fraudulent Philippine birth certificate.
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