EXPLAINED: What are Southeast Asia's scam centres, and why are they being dismantled?

Scam centres that operated along the Thai-Myanmar border for years have drawn fresh attention after the high-profile abduction and release of a Chinese actor in Thailand. The incident sparked a multinational effort among Thailand, China and Myanmar to dismantle the centres in a network of scam compounds across Southeast Asia.

Criminal gangs have trafficked hundreds of thousands of people to such centres to help generate illicit revenues running into billions of dollars a year, the UN says.

What are they?

Scam centres, particularly those in Cambodia, Laos and Myanmar, run illegal online schemes to defraud people.

Scammers often reach out to victims on social media and messaging applications to build online relationships before luring them into making fraudulent investments, such as in cryptocurrencies, a scheme commonly known as “pig butchering”.

Money laundering and illegal gambling operations are also run from some sites, analysts say.

The main focus of the current crackdown is Myanmar's Myawaddy region, along the Thai border, where scam centres often enjoy the protection of armed groups such as the Karen National Army (KNA) and the Democratic Karen Buddhist Army (DKBA).

When did they start?

Scams in the region originated from loosely regulated casinos and online gambling, beginning in the 1990s and gathering pace in the 2000s, the US Institute of Peace (USIP) says.

Shwe Kokko, a major scam compound in Myawaddy, was set up in 2017 by the Hong Kong-registered Yatai International Holdings Group and the precursor of the KNA, then under control of the Myanmar military, and advertised as a casino destination, USIP said in 2020.

The company has denied involvement in any criminal activities, including human trafficking.

Scamming operations in Myanmar's borderlands have expanded significantly in the last few years.

A think-tank, the Center for Strategic and International Studies, said criminal groups sought new sources of profits when the lockdowns and strict border controls brought by the Covid-19 pandemic prevented gamblers from travelling.

“Many repurposed the facilities into cyber-scamming compounds,” it added.

Who operates them?

Criminal networks primarily originating from China are known to operate scam centres and, in Myanmar's Myawaddy region, armed groups such as the KNA also support operations, USIP says.

Some foreigners brought out of Myawaddy say coercion and torture are rife in the scam compounds.

Junta-aligned groups also ran or supported such centres along Myanmar's northern border with China, much to Beijing's frustration. Some were caught up in fighting as anti-junta rebels launched the “Operation 1027" offensive in 2023.

A 2023 Reuters investigation traced at least $9m linked to “pig butchering” scams to an account registered to a well-connected representative of a Chinese trade group in Thailand.

What is the latest crackdown?

Some regional nations have stepped up efforts to break up the compounds. Thailand has cut power, fuel and internet links to areas in Myanmar linked with scam centres.

The current crackdown was triggered by the January abduction of Chinese actor Wang Xing in Thailand, which set off a social media uproar in his home country. Though he was later found in Myawaddy and swiftly sent home, the incident sowed concern in Thailand, where Chinese visitors are critical to the lucrative tourism industry.

Inside Myanmar, the junta has detained more than 3,700 foreign nationals related to scam centres since the end of January with more than 750 sent home, state media say.

Last month, China flew home about 200 citizens from Thailand's city of Mae Sot, which borders Myawaddy. About 7,000 people, most of them Chinese nationals extricated from scam compounds, are still sheltering in camps run by the KNA and DKBA.

The Thai crackdown has also widened to Cambodia, where authorities rescued more than 215 people from a scam compound. 

Reuters