China’s “strict laws against gambling, in person and online,” have “pushed organised crime groups into Southeast Asia, where they can tap this lucrative market from a safe distance and align with local elites to protect themselves from Chinese law enforcement”.
That is according to a 70-plus-page report on ‘Transnational Crime in Southeast Asia’, issued by the United States Institute of Peace (USIP), based in Washington DC in the U.S. The body describes itself as a “national, non-partisan, independent institute,” founded by U.S. Congress.
Its report on transnational crime in Southeast Asia stated: “The scamming operations proliferating in the region today have their roots in a regional network of loosely regulated casinos and online gambling that, beginning in the 1990s and accelerating in the 2000s, some governments promoted as a legitimate contribution to economic development.”
The U.S. Institute of Peace said there was a global threat to consumers – including the public in the U.S. – of transnational syndicates operating out of Southeast Asia.
It stated: “As of the end of 2023, a conservative estimate of the annual value of funds stolen worldwide by these syndicates approached US$64 billion.”
The institute added, as far as the betting element was concerned: “Chinese nationals were the main target of the overseas gambling business due to a complete ban on gambling in [mainland] China, where the annual market for gaming is estimated at US$40 billion to US$80 billion.”
The U.S.-based body observed: “As the criminal networks have become more powerful, the Chinese state, recognising that it can no longer control them, has become more concerned about the threat their activity poses to its citizens, who are major victims of the criminal scamming and the capture of forced labour through fraudulent trafficking.”
Some of the illegal activity in Southeast Asia was “hidden by a veneer of apparent legitimacy, such as casinos, resorts, hotels, and special economic zones,” with the “dispersal of these networks into the region… strongly correlated with the areas of weakest governance,” said the U.S. Institute of Peace.
While China had some success with enforcement against online gambling aimed at its people, as well as against general fraud and scam operations – via cooperation with other countries – there had also seen some displacement of the problem, rather than outright eradication, suggested the institute.
“The networks are able to evade occasional crackdowns by law enforcement by transferring their scamming operations between compounds within a country or between countries, depending on the circumstances,” stated the report.
It added: “A move by China’s law enforcement in late 2023 to close down the scam compounds on Myanmar’s border with China led many of them to relocate to the south in Myanmar’s Karen State, on the border with Thailand, as well as to Cambodia and Laos.”
