Lights dimmed at South-east Asia’s scam hub – but ‘pig butchering’ goes on

MAE SOT, Thailand/MYAWADDY, Myanmar/SHANGHAI/NANTONG, China – The garish lights that once illuminated the night sky over the Burmese border town have not been seen for months – not since the electricity, internet access and fuel supply from Thailand were cut off.

But just as the neon signs and LED displays that once wrapped around Shwe Kokko’s casino and hotels were a conspicuous display of wealth and allure, the town’s more subdued facade is also largely superficial.

In reality, life has largely returned to normal in this scamming hub, home to some of the world’s largest and most notorious fraud farms – even after a targeted crackdown in February saw more than 9,000 workers from dozens of different countries removed and repatriated.

Across the Myawaddy district on the Myanmar side of the border, separated from Thailand by just the 20m-wide Moei River, construction activity hums along: amid the loud clanging of metal and the whir of power saws, tower cranes swing overhead completing high-rise buildings.

Three separate buildings, wrapped in green construction mesh, are draped with red banners emblazoned with Chinese characters to mark the “auspicious” occasion of the towers’ “topping out” – the milestone celebrating the completion of a building’s structural framework.

Starlink satellite-based systems provide internet and telecommunications, while solar panels and petrol generators augment power supply. Fuel demand has surged so much that prices spiked across neighbouring districts in Myanmar, according to sightings and reports by international experts and aid groups.

Locals residents and workers in Shwe Kokko say the township’s entertainment venues – from the casino to restaurants, hotels and brothels – have remained open, although business across the board has been quieter since the raids, and electricity is rationed. Most tellingly, the large scam compounds in the area also appear to be operating as usual.

“Those Chinese syndicates rely on big generators they quickly acquired right after the cut… some buildings generate electricity with big solar panels,” one Thai worker in Shwe Kokko told The Straits Times, adding that the syndicates were still operating while trying to stay as far under the radar as possible. The worker, who remains at the compound, was not identified for her safety.

Ms Amy Miller, the South-east Asia director for aid group Acts of Mercy International, said people were still being trafficked into Myanmar daily as crime syndicates look to “replenish the compounds”.

“It is business as usual inside the compounds,” she said. “I get messages every single day from people inside pleading to get out.”

Over the past decade, South-east Asia has become a major breeding ground for transnational criminal networks, predominantly originating from China.

The UN Office on Drugs and Crime describes the region as “ground zero” for the global online scamming industry. In an April report, it said transnational organised crime in the region is evolving faster than at any previous point in history, marked by the proliferation of industrial-scale cyber-enabled fraud and scam centres, driven by sophisticated interconnected networks of money launderers, human traffickers and data brokers.

These scamming operations involve hundreds of thousands of individuals, many lured by fake online job advertisements promising high-paying tech roles. These people are often trafficked illegally across loosely controlled borders and confined in scam compounds.

Those tasked with recruiting these victims – turned scam workers – also get creative with their techniques, even customising it to individual motivations. Some victims include young people who unknowingly befriended scammers through online games and were invited on trips to border cities. Others are women working in karaoke lounges, persuaded by regular clients to be “travel companions” on trips to countries such as Thailand.

Once there, they are held under guard in prison-like conditions and forced to carry out elaborate online fraud schemes. A common scam, known as “pig-butchering”, involves building trust with potential targets – often through social media or dating platforms – before deceiving them into participating in fraudulent investment schemes.

Data collected by social enterprise Humanity Research Consultancy shows that South-east Asia has the highest concentration of scam compounds globally, with over 300 known sites in the region.

Dr Han Bing, an economic crime lecturer at the University of Portsmouth and an expert on telco fraud in China, said scam farms operate like companies, with departments such as human resource, marketing and information technology.

“There are some Chinese who have gone to work in these fraud farms willingly due to a lack of good job opportunities in China, even as there are also those who were tricked and trafficked,” she said.

These workers were promised salaries “significantly higher” than what they could earn in China, but “in reality, the high pay is often never delivered”, she added.

This industry is concentrated in countries such as Myanmar, Cambodia and Laos, where an estimated 350,000 people are involved. Experts conservatively estimate that these regional scam networks generate between US$50 billion (S$64 billion) and US$75 billion annually.

“This makes transnational fraud perhaps the most dominant economic activity in the entire Mekong sub-region – equivalent to nearly half of (the) total GDP (gross domestic product) in the primary host countries,” Mr Jacob Sims, a visiting fellow at Harvard University’s Asia Centre who has researched the region’s scam syndicates extensively, said in his May report.

Much of the transnational criminal activity has been traced back to China, experts say, with the activity driven to South-east Asia by tighter enforcement of laws against online and in-person gambling, anti-corruption efforts and a ban on cryptocurrencies – all part of broader measures in China to curb capital outflows and money laundering. Graft in some of South-east Asia’s governments and local militia is another critical factor that has helped in the growth of fraud farms in the region, they added.

Dr Han said the early iterations of mass-dialling telco fraud operations originated in Taiwan, with media reports on such scams going back to the mid-2010s. Subsequent clampdowns pushed these operations across the Taiwan Strait to Fujian province, where locals became involved.

China’s passing of its first Anti-Telecom and Online Fraud law in 2022 – which empowers enforcement agencies to pursue overseas suspects and orders telcos and banks to hunt down scammers – further exacerbated the fraudsters’ flight to South-east Asia. There, they have flourished in longstanding crime havens such as the Golden Triangle and other border regions, merging with existing organised crime and money-laundering networks to expand to a global industrial scale.

“The crime syndicates and their opaque transnational linkages are amassing even more dangerous political power,” said Mr Sims, who is also a founding partner of the anti-scamming non-governmental organisation Operation Shamrock. “Regional elites are implicated neck-deep and, in certain contexts, the industry appears too big to fail.”

Despite the alarming scale of crime, human trafficking and mounting financial losses suffered by innocent victims worldwide, there has been limited international coordination and political will among the countries involved to address the situation.

While the wave of raids in Myawaddy in February captured international attention, experts say it barely scratched the surface of the problem, with upwards of 350,000 scam workers still operating across the region. Without intensifying pressure, the raids have amounted to little more than a minor inconvenience for the crime syndicates, which have since adapted or shifted operations to neighbouring Cambodia, Laos and beyond.

However, there are signs that the pressure has encouraged scam syndicates to continue their growth and diversify away from targeting Chinese nationals and focus on people from other countries.

“There’s more fear when it comes to scamming the Chinese. There’s a recognition that it’s more costly to scam the Chinese and the risk is higher, because this is the top issue for the Chinese police, as well as for the Chinese courts,” said Mr Jason Tower, the Myanmar country director for non-profit United States Institute for Peace.

More than a third of known scam compounds in South-east Asia are scattered along the border between Myanmar and Thailand.

ST spoke to a Filipino national who has been working at a KK Park compound for six months. She said she was promised $1,700 a month for a customer service role but was instead made to work 16 hours a day for less than a quarter of the promised wages.

Each month, she is required to identify 200 potential scam targets using various social media platforms – Facebook, LinkedIn, Instagram and Nextdoor – primarily focusing on US nationals. Failure to meet the quota will result in docked wages.

She said there are 15 Filipinos in the building where she works, all under the control of those she described as “Chinese bosses”. While there are other nationalities in the building, she does not know how many there are because they are not allowed to meet or see one another.

An Ethiopian man also told ST that his 26-year-old younger brother went to work at the Hong Tai company, located within the Taichang compound under Democratic Karen Buddhist Army (DKBA) control in Myanmar. After two years of working “to scam people online”, his brother began asking family members for help, mentioning unsafe working conditions, including beatings and having his pay docked for underperformance.

“When his boss began punishing workers brutally day after day, that’s when he wanted to leave,” the man said, adding that he last spoke to his brother in April.

In China, tactics to lure unsuspecting Chinese nationals into fraud farms have evolved and have become harder to detect. For example, the disappearance of Chinese actor Wang Xing in Mae Sot on Jan 3 led to nationwide calls for the Chinese government to conduct deeper crackdowns into fraud farms. Mr Wang had travelled there believing he was taking part in a filming project. Mae Sot is a city in western Thailand that borders Myanmar.

Little seemed out of the ordinary when the actor responded to a casting call posted in an online chat group in December 2024. The job, set to begin in January, was in Bangkok and paid 500 yuan (S$90), below the market rate there, but Mr Wang thought nothing of it when he signed up, thinking it was good exposure. He had previously worked on an assignment in Thailand in 2018 without incident.

Although Mr Wang was not particularly well known, word of his disappearance spread quickly after his girlfriend in Shanghai raised the alarm. The message was amplified by some of China’s top celebrities with huge online followings, including actor Lay Zhang, the lead in No More Bets, a 2023 blockbuster about Chinese nationals being tricked and trafficked overseas into fraud farms.

Mr Wang’s predicament swiftly became national news and a full-blown diplomatic incident. The Chinese government moved quickly to track him down and secure his release, confirming his rescue just days later on Jan 7.

Thailand’s reputation in China as a fun and safe tourism destination suffered significant damage – from which it has yet to fully recover. Chinese tourists cancelled planned holidays to Thailand en masse over the Chinese New Year period, while Hong Kong singer Eason Chan cancelled his concerts in Thailand, citing safety concerns for his travelling fans.

Mr Wang’s speedy rescue also sparked questions from families of the many thousands of other Chinese nationals trafficked into scam compounds, who have grown frustrated by the lack of progress in finding their loved ones – some missing for years.

Mr He Sheng reported his teenage son missing in September 2024 after the boy went to the southern Guangxi autonomous region – which borders Vietnam – for a job recommended by a neighbour.

“My son would not have left Chongqing if the offer did not come from someone he trusted,” said Mr He, who works as a ride-hailing driver in Chongqing. His son remains missing.

Eager to salvage its reputation in China as a tourism hub – and with the scam issue threatening to overshadow the 50th anniversary of diplomatic relations between the two countries – Thailand, in early February, cut its provision of utilities to the Burmese border regions where scam compounds proliferate.

It also increased military personnel at border crossings and issued arrest warrants for the leaders of the Karen National Army (KNA) and the Democratic Karen Buddhist Army – Brigade 5 (DKBA-5), militias in war-torn Myanmar that control the border regions with Thailand and shelter the illegal scam compounds.

The KNA rebranded from its former name, the Karen Border Guard Force (BGF), in March 2024. The DKBA-5, also known as the Democratic Karen Benevolent Army, splintered from the original DKBA.

The armed groups initially claimed to be unaware of any illicit activity under their jurisdictions.

“Our investigations found that everyone has a Thai visa and came through Thailand,” Colonel Saw Chit Thu, the Karen warlord whose militia controls the major scam hubs of Shwe Kokko and KK Park along the Thai border, said on Feb 17 after the crackdown.

Shwe Kokko, once mostly dense jungle and better known as a trading post for smuggling cattle into Thailand, began transforming in 2017 as Chinese investment started flowing in. KK Park, developed later, is about 40km further south.

Col Saw Chit Thu denied any involvement in the Chinese-run scams, claiming the KNA’s income is derived only from rent from businesses operating on its land.

Lieutenant-General Saw Shwe Wah – deputy commander-in-chief of the DKBA-5, which oversees the notoriously brutal Tai Chang compounds – was even more dismissive: “We don’t even know how to use an ATM card to withdraw money; how could we know about online scamming?”

But under intense pressure from Thai and Chinese authorities, both the KNA and DKBA were finally compelled to act.

Col Saw Chit Thu said his militia launched raids on Feb 14 after seeing media reports about call-centre syndicates and forced labour in Myawaddy district. At the time, he said all scam compounds would be purged by the end of February and urged Thai authorities to resume the provision of utilities, citing hardship for regular citizens.

In an interview with ST, however, the KNA spokesman, Lieutenant-Colonel Naing Maung Zhaw, said that while the armed group had done its best to rid Shwe Kokko of illicit activities, it would likely take until 2026 to fully get rid of the scam compounds.

He expressed long-term ambitions to transform the town into a modern business and industrial park, saying: “We have tried to secure the people with the utilities they need. The cut (in provision of utilities) hit them hard, and it’s up to us to take care of them.

“It is our dream to see this town improve the well-being of our people. It will continue being so.”

But analysts have long expressed scepticism over whether the KNA has any genuine intent to eradicate from its jurisdiction the very scam operations that essentially provide a financial lifeline for its military operations.

On the ground in Myawaddy, electricity generators – big and small – are seen everywhere: in front of shops, hotels, banks and offices. Many residents, however, get by with just a lamp and candles, as generators are too expensive.

Mr Zhaw, a 43-year-old taxi driver and father of three, says things have mostly returned to normal after he initially had to wait in line for hours in Myawaddy or drive into Thailand to refuel his vehicle following the cuts in February.

“There has been petrol delivered from the inner cities of Myanmar since May,” he said.

Mr Zhaw, who declined to give his full name, added that residents in Myawaddy had long grown accustomed to unreliable electricity after fighting between armed groups and the Myanmar military destroyed the city’s only power station.

“The recent outage has had a direct hit only on the scamming centres because the electricity from Thailand serves them directly, rather than Myawaddy city,” he told ST.

“People in Myawaddy have been without electricity for more than two years; we have lived with this issue for a long time.”

Survivors of scam compounds such as those in Myawaddy told ST that the ruses used to lure fellow victims – including Chinese nationals overseas – have become increasingly elaborate, making it exceedingly difficult to distinguish fake offers from genuine ones. This is often because the offers would come from someone they trusted.

When Mr Dong Biao’s eatery business went belly-up in 2023, a close friend of four years offered him a job as a software developer at a media company in Myanmar.

“We hung out all the time. I even went to the opening of his media companies in China,” the 28-year-old told ST.

The “job offer” eventually led to Mr Dong being sold to a fraud farm in Myanmar, where he was held for 17 days before managing to escape.

Part-time actor Xu Bochun, 39, told ST that he fell victim to a similar scam in 2023 – much like actor Wang – after responding to a casting call.

That job, however, was advertised as being in the south-western Yunnan province – which shares a 4,060km-long border with Myanmar, Laos and Vietnam – and did not raise alarm bells as it was not an overseas offer.

During his three months in captivity, Mr Xu, who also works as an education consultant in Shanghai, witnessed how other victims were lured.

Scammers would often pick out younger, better-looking workers, dress them in expensive clothes and watches, and have them “dine” in a corner of the fraud farm that is made to look like a fancy restaurant. Pictures will then be taken and posted on social media – all in a bid to entice other Chinese nationals to visit border towns and regions.

“But, behind the camera, their captors would be pointing guns at them, so they were forced to act like they were living it up,” Mr Xu said.

Viewed in its entirety, analysts say the February raids in Myanmar amounted to little more than a grand display of political theatre.

“It was an acute reaction to Chinese pressure that provoked, basically, a showy response,” Mr Sims said. “I hesitate to use that term, because, you know, thousands of people’s lives are fundamentally better today because they aren’t in those compounds.

“But from a macro lens, this was like a PR stunt… in that it gave China the ability to claim a win domestically, to say ‘hey, look, not only do we get our guy back, but we got a bunch of other people out, and are really fighting this scam issue that impacts Chinese people’.”

The sudden release also led to a major bottleneck at the Thai-Myanmar border, leaving thousands of workers stranded for months in squalid holding camps while awaiting repatriation. The KNA and DKBA have both seized on Thailand’s inability to cope as justification for slowing down further action. During a recent visit to Mae Sot, ST witnessed dozens of workers from Ethiopia, Ghana and Vietnam being processed through the Thai border for repatriation.

While the raids captured major international attention at the time, there has been little indication they will eradicate criminal groups from the Myanmar-Thailand border or do more than scatter these elements elsewhere. Nor has there been strong evidence of continued political momentum to tackle the root causes of the problems.

There is also concern that Chinese police may gain a more permanent foothold in Thailand under the guise of its Global Security Initiative, in which the Mekong is cited as a pilot zone.

“China got what it wanted,” Mr Tower said. “It got some pictures of leading Chinese police officials going back and forth across that border. It got police access, and it got the ability to bring a large number of Chinese back to China, which was then splashed all over the Chinese media,” he added.

“But ignoring the fact the scamming continues, there are more individuals, including more Chinese, who’ve been trafficked, and that on the ground, there really hasn’t been a significant change in the scam operations down in the Thai-Myanmar border area.”

While the February raids were the first of such scale along the Thai-Myanmar border, the largest crackdown on the industry to date remains the operations carried out in the Kokang self-administered zone along Myanmar’s border with China, towards the end of 2023.

More than 50,000 Chinese nationals were detained in northern Myanmar and repatriated by January 2024, according to China’s Ministry of Public Security.

Both waves of raids, analysts say, show what is possible when Chinese authorities feel their interests are sufficiently threatened and compel political will for China and other countries to act. The frustration, however, is that momentum invariably stalls, allowing crime syndicates to regroup and spawn elsewhere.

One example of the political forces at play: it was not until relations between Thailand and Cambodia dramatically soured in June that Thai Prime Minister Paetongtarn Shinawatra rallied international cooperation to crack down on scam activity in Cambodia. But it is unclear if that effort will gather momentum now that Ms Paetongtarn has been suspended from office.

Mr Rangsiman Rome, deputy leader of the Thai opposition People’s Party, has been outspoken about the need for the government to do more to address the root causes of the scam trade and to stem Thailand’s role as a conduit for human trafficking and as the provider of physical logistics and supplies. Just like along the Myanmar border, he said there were many Cambodian scam centres hugging the Thai border for electricity and internet access.

Deadly clashes broke out between Thai and Cambodian forces on July 24 along their disputed border, where tensions have been simmering since May after a Cambodian soldier was killed in an earlier confrontation.

Separately, Cambodia said it arrested more than 2,700 suspects in a nationwide raid on scam compounds and fraud networks in July.

Meanwhile, Chinese police have continued efforts to educate the public about the dangers of telecoms fraud by releasing case studies of the latest scams and total sums cheated.

On July 4, the Chinese Embassy in Thailand issued a statement saying that a Chinese citizen surnamed Zhong had been rescued with the help of the authorities.

According to Chinese media reports, the man – reportedly a model – had flown from Guangzhou to Bangkok after receiving a work offer on June 8 to be on the cover of a magazine.

He later contacted his sister to say that he had been trafficked to Myanmar. After losing contact with him, his sister lodged reports with the police in both Guangzhou and Bangkok.

Since the start of the year, more than 5,400 Chinese nationals “involved in fraud have been arrested and repatriated”, Chinese media reported on July 6.

On July 11, the Shenzhen police in Guangdong province said it officially filed charges against 21 individuals, including key figures of the Bai family crime syndicate, which has operated a large-scale telecoms scam targeting Chinese citizens in the Kokang region since 2015.

The authorities from China, Myanmar and Thailand have worked closely together to launch an aggressive campaign against telecoms fraud in the Myawaddy region, according to reports from the second ministerial meeting on joint efforts by the three countries to combat telecoms and online fraud, held in Naypyitaw on July 4.

Officials from the three countries also pledged to continue their joint crackdown on telecoms and online fraud operations in areas such as Myawaddy, the reports added.

Meanwhile, the Karen warlords on the Myanmar border insist they remain determined to clear out scam compounds from under their jurisdictions – but have used the painfully stretched out repatriation process in February as a reason to delay further action.

With the logjam at the border now finally close to being resolved, there are some hopeful signs of further action.

“Both militaries, the BGF and (splinter group) DKBA, said this is phase one… This is just the first wave, and we’re gonna go in and get more people, and we’re gonna empty the scam centres,” said Ms Miller, the aid worker. “I think it’s really unclear what they’re going to do, if anything,” she added.

“Everyone’s kind of holding their breath, like, what is going to happen?”