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A United Nations report has shed light on the scale of fraud and money laundering helping power cyber crime in south-east Asia.
The COVID-19 pandemic changed the way a lot of people work, both in legitimate businesses and illegitimate ones. A new report from the United Nations Office on Drugs and Crime has revealed how the shutdown of international travel forced numerous south-east Asian casinos to evolve into online operations, which have now, in many cases, become the backbone of highly organised cyber fraud and money laundering businesses.
“This transformation follows years of progressive enforcement and regulatory efforts targeting cross-border cash movement, the casino industry, and related money laundering and has been led in part by casino and junket operators who have effectively become bankers for organised crime,” said Jeremy Douglas, the UN’s regional representative for south-east Asia and the Pacific, in the report, Casinos, Money Laundering, Underground Banking, and Transnational Organized Crime in East and Southeast Asia: A Hidden and Accelerating Threat.
“At the same time, many casinos and connected businesses like junkets have physically relocated into autonomous areas and special economic zones or SEZs across the region that, in some instances, have become safe havens and breeding grounds for criminal networks.”
These criminal networks have, in many cases, diversified into large-scale cyber fraud operations. And as the casino operations moved into loosely regulated areas of countries such as Cambodia, Myanmar, and Laos, the criminal groups tied into that economic strata moved with them.
These groups are taking advantage of human trafficking and youth unemployment in the region to staff massive cyber fraud centres, running pig butchering and investment scams, as well as sextortion rackets and impersonating law enforcement.
The rise of artificial intelligence is also making an impact.
“Concerningly, recent advances in large language model-based chatbots, deepfake technology, and automation have given rise to more sophisticated and damaging cyber fraud schemes, posing a major threat to individuals and the formal banking industry,” the report said.
“By using artificial intelligence (AI) to create computer-generated images and voice that are virtually indistinguishable from real ones, scammers can execute social engineering scams with alarming success rates, exploiting people’s trust and emotions.”
The report also notes that criminal organisations in the region are continuing to diversify and are engaging in developing malware and blockchain gaming platforms, building cyber crime-as-a-service operations, and even their own crypto exchanges.
The UN believes that more work needs to be done to monitor criminal activity in these grey zones. Governments and law enforcement need to collaborate and share knowledge, and more advocacy work needs to be undertaken to educate the public on the connections between the casino industry in the region and organised crime. Tighter regulations are needed, alongside a greater focus on digital forensics and data collection and analysis.
You can read the full UN report here.
David Hollingworth has been writing about technology for over 20 years, and has worked for a range of print and online titles in his career. He is enjoying getting to grips with cyber security, especially when it lets him talk about Lego.
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