Trafficking into Forced Criminality: the Rise of Scam Centres in Southeast Asia

Trafficking into Forced Criminality: the Rise of Scam Centres in Southeast Asia

Dr Sasha Jesperson
18 Jan, 2024

In Southeast Asia, a growing number of scam centres have been identified, where recruits groom victims online to encourage investment in fraudulent schemes. But these recruits are victims themselves; tricked with job offers in another country, they are forced into criminality. Described using the Chinese term Shāzhūpán, or ‘pig-butchering scams’, so-called because they ‘fatten up’ their targets before going in for the ‘slaughter’ and stealing their money. Estimates from one Southeast Asian country indicate that these scams generate from 7.5 to 12.5 billion USD.

From Gambling to Scams

Organised crime groups are continuously seeking new ways to generate profits for the lowest amount of risk. Criminal networks involved in human trafficking are particularly adept at this – leveraging the desire of individuals, their families and communities to migrate, and making victims complicit in their own exploitation. A recent trend in Southeast Asia takes this even further: falsely recruiting prospective labour migrants into legitimate-seeming jobs, and then transporting them the scam centres in isolated area. The victims are then forced to scam others into investing in cryptocurrency, gaming or other schemes.

During a political economy analysis of labour trafficking in Southeast Asia by ODI for ASEAN-ACT, these scam centres were identified in Cambodia, Laos, Myanmar and the Philippines, with victims originally from the region, and as far afield as Africa, Central Asia and Europe.

Multiple variables have contributed to the rise of scam centres in Southeast Asia. Gambling facilities that target Chinese nationals have been spreading across the region since gambling became illegal in mainland China in 1949. Beginning in Macau, other countries in the region have exploited the opportunity to cash in on the Chinese appetite for gambling. The Covid-19 pandemic limited the ability of gamblers to travel, increasing reliance on online gambling. However, President Xi Jinping has been putting pressure on Southeast Asian countries to ban gambling, including online gambling. This has pushed many gambling facilities to repurpose themselves.

Scamming as an operation has risen alongside the growth of gambling, especially targeting Chinese nationals. But, much like the crackdown on gambling, the banning of cryptocurrency in China created a need to expand the reach of scam centres. This created a demand for scammers with different language capabilities. Most recruits are forced to target their own nationals. However, for instance, Filipino recruits are in high demand because of their English language skills.

Deceitful Recruitment and Coercion

Recruits have been targeted through advertisements for jobs in digital marketing and customer services. Often, these adverts include offers that are ‘too good to be true’. For example, qualified engineers have been recruited into apparently legitimate jobs on construction sites and translators have been targeted as well.

Once workers arrive at the scam centres, their passports and other documents are confiscated, making it difficult to leave. Mobile phones are also confiscated, and the use of phones and the internet in the scam centres are monitored closely. In addition, many of the centres are located in isolated areas, which makes it harder to raise the alarm or seek assistance.

Workers in scam centres labour between 12 and 20 hours a day, six days a week, and receive only limited medical attention or food. Reports indicate the workers have daily quotas for the number of people to scam and are punished if they do not reach them. Some reports refer to the use of electrocution as a form of punishment. In others, there are references to being beaten, deprived of food or having deductions from their salary for even minor infringements.

Scam centre workers are engaged in criminal activities – encouraging their targets to invest in cryptocurrency or deposit money in gaming accounts, which are then kept by the groups running the scam centres. While most workers in scam centres are forced to engage in these activities, it is important to note that a minority choose to stay because of the potential to make money. For those who try to leave, some are told they need to pay large sums or must find replacements, which would make them complicit in trafficking.

A Different Demographic

The migration that the scam centres encourage is distinctive. While most labour migration flows tend to pass from poorer to wealthier countries in the region, driven by limited job prospects in the countries of origin and more attractive pay in destination countries, the flows are inverted in the case of the scam centres. In these cases, recruits from all countries – both poorer and wealthier – travel to what are often poorer countries in the region. It is noteworthy that Cambodia, Laos, Myanmar and the Philippines are the largest destinations for scam centres whilst also the poorest countries in ASEAN.

Second, the labour migrants involved have a different profile from that found in other labour migration. While most labour migrants are poorer people (although not necessarily the poorest) who migrate in search of better chances of earning a living, the scam centres are changing this profile. Generally, workers recruited to scam centres respond to advertisements on social media for jobs that sound legitimate and offer good salaries and working conditions. They also require education and experience – not the low or unskilled jobs often associated with exploitation in the ASEAN region.

The differences among labour migrants deceived into scam operations means that existing ways of working on counter-trafficking may be inadequate.

Clear Links to Organised Crime

Compared to other forms of labour trafficking, where a network of opportunists take advantage of people desperate to seek work abroad, the networks behind scam centres are much more organised, with a clear link to Chinese organised crime. Training manuals that include scripts for scams, indicating how professionalised these tactics have become.

She Zhijiang (also known as She Lunkai, Dylan She and Tang Kriang Kai) is the chairman of Yatai International Holdings, which is registered in Hong Kong and headquarted in Bangkok, with significant business interests in Cambodia, Myanmar and the Philippines, including casinos. Infrastructure developed by Yatai International Holdings, such as Yatai New City in Shwe Kokko, Myanmar which was initially part of the Belt and Road Initiative, has been repurposed for criminal activity. Investments in gambling operations and special economic zones in Cambodia and the Philippines have also been used to build scam centres. Because of these business interests, She has been treated well by governments in the region, including being granted Cambodian citizenship. The Thai Government has been less sympathetic, and are attempting to extradite She to China to face charges.

Organisations behind the scam centres are also linked to an online trade in human beings, using platforms such as Telegram. One example is the White Shark Telegram channel which has been used to sell forced recruits to scam centres.

In sum, trafficking into scam centres is part of a complex and sophisticated transnational organised crime network which, therefore, necessitates collaboration with government and other partners that goes beyond a response to human trafficking.

Dr Sasha Jesperson is a consultant focused on transnational organised crime. She has worked with a range of governments, donors and institutions to strengthen policymaking and programming and to build the evidence base on transnational organised crime. Since 2021, Sasha has been part of a team conducting political economy analyses of labour trafficking in Southeast Asia for ASEAN-ACT, engaging with the growing threat of scam centres.

Main image Credit: ‘Call Center’ by Carlos Ebert via Flickr.

The views expressed in this article are those of the author and do not necessarily reflect the views of RUSI, ECPR, Focused Conservation or any other institution.