According to a recent United Nations assessment, cybercrime syndicates in Southeast Asia have partnered with money launderers, human traffickers, and cryptocurrency services to create an increasingly potent cybercrime ecosystem that can withstand law enforcement crackdowns.
“Highly sophisticated” Asian crime syndicates have expanded their operations, embraced new technologies, and amassed billions of dollars in cryptocurrency, according to a report released by the U.N. Office of Drugs and Crime on Monday. According to agency projections, Asian victims of cyberattacks and scams will have lost between $18 billion and $37 billion by 2023.
“Leveraging technological advances, criminal groups are producing larger-scale and harder-to-detect fraud, money laundering, underground banking and online scams,” said Masood Karimipour, U.N. agency regional representative for Southeast Asia and the Pacific. “This has led to the creation of a criminal service economy, and the region has now emerged as a key testing ground for transnational criminal networks looking to expand their influence and diversify into new business lines.”
Many criminal organisations that once operated out of abandoned buildings now have headquarters in contemporary, heavily guarded facilities with tall walls, barbed wire, armed guards, and close surveillance. They run a variety of illicit online gambling services, business parks, special economic zones, and underregulated casinos inside the walls.
This advanced infrastructure is a hint that the gangs are making large profits with little or no law enforcement intervention. Many groups have moved their operations in the past few years to densely forested or difficult-to-reach areas, such the Mekong valley or war-torn areas like KK Park in Kayin state, Myanmar.
According to U.N. analysts, a number of Asian criminal organisations have established strongholds in the Golden Triangle, a vast mountainous area that includes portions of Thailand, Laos, and Myanmar. Since the 1950s, the area has functioned as the primary global centre for the production and trade of opium.
It’s not by accident that cybercrime organisations frequent the same remote locations as drug smugglers. The agency pointed out strong connections between organisations that commit cybercrimes and those involved in other illegal operations like prostitution, human trafficking, drug trafficking, pornography, and money laundering.
By keeping governments and law enforcement agencies away from the compounds, syndicates are able to hold thousands of trafficked IT workers captive and coerce them into conducting internet scams thanks to the cybercrime ecosystem. According to estimates made by the U.N. Human Rights Office last year, fraud centres in Cambodia and Myanmar imprisoned 100,000 and 120,000 people against their will, respectively. (see: Cambodian Scam Compounds Emerging as Growing Cybercrime Hubs)
The U.N. team, which issued a warning earlier, claims that cybercrime syndicates are investing large sums of money to establish reliable networks made up of extensive physical and internet communication technology infrastructure in order to increase the efficiency of their operations. These syndicates are known to use a network of casinos, money laundering, and underground banking networks to conceal their illicit proceeds.
The demand for cryptocurrency solutions, deepfake technologies, generative AI-as-a-service solutions, and virtual asset services has increased significantly as a result of these syndicates’ search for service-based business models in underground markets. The majority of these products are sold through hundreds of Telegram forums and underground markets.
In 2024, the number of references to deepfakes and AI-enabled content in online criminal forums increased by 600%.
“The integration of generative artificial intelligence by transnational criminal groups involved in cyber-enabled fraud is a complex and alarming trend observed in Southeast Asia, and one that represents a powerful force multiplier for criminal activities,” said John Wojcik, U.N. regional analyst. “These developments have not only expanded the scope and efficiency of cyber-enabled fraud and cybercrime, they have also lowered the barriers to entry for criminal networks that previously lacked the technical skills to exploit more sophisticated and profitable methods.”
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