Ground Zero: Inside Southeast Asia's Billion-Dollar Scam Industry

Criminal activity in Southeast Asia has undergone a significant transformation, resulting in immense economic loss and human trafficking from the growth of cyber scam networks. Estimates place the total loss in the Asia-Pacific region between 88.3 billion and 114.1 billion US dollars in 2025 alone. In terms of human toll, over 300,000 trafficked workers from 66 countries have been coerced and currently work in the scam industry in Southeast Asia. 

The scam industry’s origins trace back to the 1980s in northern Myanmar along the border with China’s Yunnan province. Myanmar’s military government struck several deals with ethnic armies in the region to achieve a ceasefire. Through these deals, armies could remain armed and run illicit businesses. Many of these groups amassed large fortunes in the 2000s through selling drugs, trafficking, and most significantly through running casinos. They typically catered to and heavily relied on “high-roller” clients from China, where gambling is illegal. Chinese mafia families built the casinos in remote and impoverished towns, which they eventually developed into sprawling hubs for drugs and scam centers. Additionally, the families that ran criminal rings in the casinos also used them as fronts for money laundering and drug trafficking. They also had ties to the Myanmar government, giving them slightly more protection from crackdowns.  

In 2020, the pandemic closed the Chinese border, effectively leaving the casinos empty.  To maintain profits, casinos shifted from an in-person business model to digital spaces. The casino buildings and hotel rooms were converted to house the development of new criminal operations. Essentially, the casinos transformed into “criminal service providers” that became successful by selling cybercrime and disillusioning targets into sending money and harvesting their data. The 2021 Myanmar coup d'état further accelerated the development of cyber fraud. When the Myanmar military overthrew the government, it created perfect conditions to expand criminal operations due to weak oversight and minimal regulation. However, cyber scams are not exclusive to Myanmar. Fraud schemes spread to Cambodia, Laos, Thailand, and the Philippines. 

According to the Associated Press, aside from casinos and hotel rooms, networks mostly operate out of scam compounds, often built in rural areas and consisting of large complexes containing dormitories and cafeterias for the staff that are under constant surveillance. Local elites protect the compounds and keep them running because they profit from the money brought in from the scamming industry. Some smaller operations exist in urban areas in office buildings or rented houses, but are less common.  

Workers are lured in, usually through fake job offers or acquaintances offering opportunities for high wages abroad, and are then coerced into labor. Recruiters utilize artificial intelligence and translation tools to sound more convincing and target people worldwide. Once workers arrive at the compound, their passports are taken, and leaving becomes very difficult. Violence is common in these complexes, and laborers can be tortured for missing quotas or trying to escape. Rescue attempts are rare and depend heavily on NGOs, foreign embassies, or private negotiation. Furthermore, the lack of cooperation between countries in the region makes this even more complex. 

In scam centers, laborers must work 12-16 hours a day and use a variety of deceptive tactics to extract as much money as possible from their targets. This can be as simple as messaging “Hello” or inquiring about interest in a part-time job. More severe tactics include romance scams, illegal gambling ruses, trading platforms, and fabricated investment pitches.

Although scams originating in this region are now a global issue, the response and crackdowns have not been successful. First, scam networks deliberately set up operations in areas “where regulatory gaps intersect with political or economic incentives to tolerate them.” Even when a compound is shut down, it is rarely dismantled, often resulting in the “balloon effect,” where operations relocate, and fraudulent schemes continue. Moreover, corruption and bribery among local governments and officials are widespread, allowing operations to proceed. Second, critical structural problems hinder efforts to eliminate this issue. Governments and their limited resources cannot keep up with the speed at which technology  develops and is adopted, widening the gap. The rapid development of artificial intelligence, for example, opens doors to new opportunities for scammers to extract more money from targets, including the use of AI and deepfakes. These developments can greatly expand a scam farm's productivity and increase the scale of operations. Deepfake use increased by 1,530 percent in the Asia-Pacific region from 2022 to 2023. This technology enables scammers to carry out investment fraud and impersonate people, exploiting targets’ emotions. LLMs allow scammers to create more realistic text messages quickly. An example is “FraudGPT,” an unrestricted cybercrime assistant available on the dark web. Additionally, the sale of malicious software that reconfigures domain names and accesses payment systems for profit lowers the barrier to entry for cybercrime. 

Southeast Asia’s cyber scam industry has risen over the past few decades, becoming a global challenge. The COVID-19 pandemic and the 2021 Myanmar coup d’etat reshaped criminal networks originating in the region. Regulatory gaps, corruption among local officials and authorities, and poor regional cooperation have allowed scam operations to take hold and persist. These scams cause billions of dollars in losses for victims and coerce hundreds of thousands of people into labor. Due to the complex nature of these operations and the acceleration in the development of technology, concerns cannot be resolved by a single country. Progress and change will require regional and global cooperation.