Following increased attention to Southeast Asia’s online scam industry, especially since the high-profile abduction and rescue of Chinese actor Wang Xing from a compound on the Myanmar-Thailand border in January, the Chinese government has coordinated multilateral efforts to crack down on illicit groups and repatriate victims who had been forced to work in the scam centers. At Beijing’s request earlier this month, the Thai government cut power, fuel, and internet connectivity to five border areas of Myanmar where scam centers have been operating. About 7,000 people, over half of whom are Chinese, have been freed and are being held by authorities near the Thai border. But a top Thai lawmaker told Reuters this week that there are still 300,000 people still operating in these compounds, and that “the empire of the scam is still there…we’re just shaking them.” WIRED also reported on Thursday that scam centers are using Elon Musk’s Starlink to stay online in defiance of internet outages. Highlighting the difficulty of dealing with these issues, Hannah Beech at The New York Times reported on Thursday on how Myanmar’s scam industry continues to thrive despite the China-led crackdown:
“China is actively carrying out bilateral and multilateral cooperation with Thailand, Myanmar and other countries to severely crack down on cross-border online gambling and fraud crimes,” the spokesperson’s office of the Chinese foreign ministry told The New York Times in a statement Thursday. “At present, many online gambling and fraud dens have been eradicated overseas, and a large number of suspects have been arrested.”
But such self-congratulation is premature, according to interviews with about two dozen people, some who have worked or are currently working in the scam centers and others who serve in national and militia bureaucracies that aid or profit from the cyberfraud industry.
Thousands of individuals who were supposedly rescued from the scam warehouses this month are still stranded between the hell of forced labor in Myanmar and the promise of freedom in Thailand. Tens of thousands more remain imprisoned in the fraud factories.
[…] And none of the major players orchestrating this international criminal network, which spans dozens of countries and operates with a Chinese nerve center, have been taken down in the current campaign. The arrest in 2022 of a Chinese-born kingpin, who is now in a Thai prison fighting extradition to China, did not slow construction in the scam towns he is accused of having run. [Source]
The Chinese government has scheduled over a dozen airlifts to ferry home over 1,000 Chinese citizens who worked in Burmese scam centers. These expedited repatriation efforts have created friction with Thailand, as China’s assistant minister for public security Liu Zhongyi “apologised for causing any misunderstanding among Thais that he might seem like he has intruded on Thai sovereignty.” However, overall rescue and repatriation efforts have been slow. The Thai government fears that without more resources to properly differentiate victims from criminals, it may be forced to house thousands of scam workers from Myanmar indefinitely. Some African countries also refuse to fly their citizens home unless someone else pays. And coordination between various government agencies has proven difficult, particularly since some senior police and immigration officers have allegedly been involved in the scam operations, as the BBC reported. Some Chinese officials are also alleged to have played a significant role in secretly supporting the criminal networks that run scam operations in Myanmar.
The recent crackdown may signal a change in China’s approach to these regional security issues. Earlier this month, Liu Zhongyi traveled to Myawaddy to meet with rescued scam workers ahead of their repatriation. Jason Tower, the Myanmar country director at the U.S. Institute of Peace, said last week, “I think we are seeing some pretty big shifts. For a Chinese police official to be down in the Thai-Myanmar border area, actually walking across the border and going in to assess the scam centers is something that’s unprecedented. […] This high-level of action is quite new.” CGTN quoted Liu Ningning from China’s Ministry of Public Security asserting that the Chinese-led multilateral mechanism will “spare no effort to rescue trapped people, arrest the financial backbone of the telecom fraud group, and resolutely eliminate the Myawaddy scam centers." Laura Zhou from the South China Morning Post framed these efforts as part of China’s growing focus on “police diplomacy” to protect its citizens overseas and expand its influence:
Li Zhiyong, an international relations professor with the University of International Business and Economics in Beijing, said: “As China’s overseas economic influence expands around the world, there is a stronger need to project China’s overseas interest, as well as the safety of Chinese nationals abroad.
“In cases such as the telecoms scams, it usually involves not just technical cooperation between the police forces but also coordination at foreign policy levels because of the complexity and the huge interest behind [it], so I think this is a trend.”
Considered a niche area of traditional foreign policy, policing diplomacy empowers law enforcement representatives with diplomatic functions. They work to share intelligence, resolve conflicts and foster security and stability.
[…] Meanwhile, Chinese police officers have been deployed to [Chinese] embassies in at least 48 countries, where they work with local law enforcement authorities in tackling crimes involving or targeted at Chinese nationals “to better protect the personal safety and rightful interest of the Chinese citizens and companies”, according to China’s public security ministry in 2023.
[…] Chinese police forces have also carried out joint patrols with their counterparts from Laos, Myanmar, Thailand, Vietnam and Cambodia. [Source]
The Chinese government’s evolving stance can also be gleaned from its judicial treatment of repatriated scam workers. Their arrival in China appeared choreographed dramatically for state media: each returnee was handcuffed, dressed in numbered jumpsuits, flanked by two police officers, and lined up for a photo op. AFP noted that the Chinese government and state media described them all as “suspects,” even though many workers say they were tricked into traveling to Thailand or Myanmar and later forced to work against their will. One report from Beijing Youth Daily profiled a now-repatriated middle-aged Chinese man who was tortured in the scam centers and said he is collecting evidence online in order to sue those responsible for imprisoning and torturing him. Last week, a court in Wenzhou, Zhejiang province concluded a six-day trial against 23 members of a Chinese crime family accused of colluding with scammers in Myanmar and charged with murder, fraud, and extortion. Ding Rui from Sixth Tone reported that on Monday China’s top court highlighted several cases in which it chose severe punishments for leaders of cross-border scam operations:
One of the most significant cases the court highlighted involved three defendants, surnamed Huang, Li, and Zhou, who ran a telecom fraud ring in Cambodia. Between September 2020 and late 2021, they swindled over 100 people out of more than 100 million yuan ($14 million).
t[…] Given the significant financial and emotional harm caused, a local court sentenced the three key defendants to life in prison, confiscated their assets, and stripped them of all political rights.
[…] In a far larger operation, the court detailed a transnational case involving a defendant surnamed Yu, who led a fraud network of over 300 people operating in Cambodia and the Philippines since 2018. His group ran online lottery scams that defrauded 111 individuals of nearly 60 million yuan by March 2020.
The scheme also relied on deceptive job postings and other methods to recruit 106 Chinese nationals into conducting fraud. Given Yu’s central role in the crimes, as well as his targeting of vulnerable groups such as the elderly and students, he was sentenced to life in prison. [Source]
Earlier this month, Sue-Lin Wong released a new podcast series for The Economist called “Scam Inc,” which investigates the global scam industry. Episode Four focuses on the role of Chinese syndicates in Asia’s scam centers. Expanding on this topic in a recent interview with The Wire China, Wong described how political-economic dynamics in China played an important role in the evolution of the global scam industry:
I guess there’s always been a lot of scams in China. But there are a couple of important factors in why China became such fertile ground. One was that online payments took off much more quickly in China than they did in the rest of the world.
There was also a class of criminals who originally were mostly focused on helping wealthy Chinese people launder their money through Macau’s casinos, the so-called junket business. Macau, which is five times the size of Las Vegas in terms of its gambling industry, was a hotbed of all kinds of criminal activity — until Xi Jinping came to power and launched his signature anti-corruption campaign across the country, including in Macau.
At that point these criminals had to pivot. They first went to the Philippines, and then to Myanmar, Cambodia and Laos, and other parts of Southeast Asia. There they set up online casinos to target the mainland Chinese market. But they realized that the backend technology for running an online casino isn’t that different from what’s needed for committing online fraud. And so they diversified. Groups that would previously have been in businesses such as drugs, prostitution, and gambling realized there was a fourth potential business line, and that they could pivot to online fraud.
That business was mostly focused on Chinese victims until Covid. That was really a turning point because it became harder for Chinese low-level scammers, or mid-level bosses, to get to places in Southeast Asia once China shut its borders. And so the criminal syndicates started kidnapping English speakers and trying to scam people around the world. That period was also when the Chinese Communist Party had really begun its crackdown on online scams inside China — there’s a whole genre of movies and TV shows and songs that became part of this anti-fraud push in China. It became harder to scam mainland Chinese, and it became harder for the criminal syndicates to lure Chinese workers to Southeast Asia. [Source]
