South Korean media claims Cambodian regime shelters scam gangs

South Korea’s Chosun Daily reported that Sihanoukville, Cambodia’s largest port city, has become home to a massive criminal syndicate known as the “Wench” group.

Over the past decade, the city has rapidly transformed into a major centre for tourism and casinos, fuelled by Chinese investment and support from the Cambodian government. However, during the Covid-19 pandemic and global economic downturn, Sihanoukville evolved into a key hub for Chinese call-centre fraud operations.

In the city’s tourist district, there are 16 luxury hotels and high-end casinos that dazzle at night to attract visitors. Yet the buildings adjacent to these hotels are “restricted zones” with strict access control, believed to house telephone-fraud syndicates. 

According to locals and foreign residents, “young people from South Korea, Vietnam and Indonesia are detained and forced to work there.”

The hotel owner and kingpin of the criminal network was identified as Xu Aimin, a 63-year-old Chinese national who was sentenced to 10 years in prison in 2013 for running an illegal online-gambling business in China. 

He escaped to Cambodia, reinvented himself, and eventually obtained citizenship—operating his criminal empire under the guise of a hotel entrepreneur.

His identity came to light last month when the US Department of the Treasury imposed personal sanctions on him. His online-fraud network reportedly caused significant losses not only to South Koreans but also to Americans, placing him on Washington’s blacklist.

The US Department of State estimated that online-fraud crimes originating in Southeast Asia, including Cambodia, caused losses of about US$10 billion (around 326 billion baht) to Americans last year.

According to the Treasury, “forced labourers in buildings adjacent to Xu Aimin’s hotel were compelled to commit cyber-fraud,” with the proceeds laundered through a property development company based in Phnom Penh.

Another figure, Dong Le Cheng, 57, was also sanctioned by the US government. Though he portrayed himself as a businessman in Sihanoukville, his hotel was allegedly used as a safe haven for cybercriminals engaged in telephone fraud.

Casinos inside the complex were used to launder proceeds from scams, while victims of human trafficking were sometimes sold to other criminal groups.

Shuo Zhi Jiang, 43, fled China in 2014 following an illegal-gambling case and later “cleaned” his identity in Cambodia. In 2015, he launched a grey-market scam business that expanded into Myanmar and Thailand. 

The report said that after Beijing tightened its crackdown on overseas gambling, Chinese investors could no longer funnel gaming funds into Cambodia, prompting them to devise “third-party payment” systems to exchange and remit money locally between gamblers and Cambodian brokers.

The international community acknowledges that many Chinese criminals have fled to Cambodia, building a vast fraud industry there. 

A report by Humanity Research Consultancy (HRC), a human-rights and policy think-tank, stated that “the Cambodian government has granted citizenship to Chinese criminals in exchange for hundreds of thousands of dollars,” adding that “small-time Chinese offenders have now become dominant players in Cambodia.”

The South Korean media also alleged that former prime minister Hun Sen had enjoyed absolute power since the 1997 coup. Although he stepped down in 2023, his son, Prime Minister Hun Manet, succeeded him. 

Among expatriates living locally, there is talk that “criminal organisations maintain close ties with Cambodia’s authoritarian regime to protect fugitives.”

The country’s long-standing dictatorship, combined with a shortage of police officers, has led the global community to regard Cambodia as “a state tolerant of crime.” Despite annual crackdowns on phone-scam networks since 2020 and official pledges to “eradicate crime,” such efforts are widely dismissed as hollow and “loosely enforced.”

The United States Institute of Peace (USIP) estimated that criminal syndicates in Cambodia generated about US$12.5 billion—more than 500 billion baht—from online-fraud operations last year, accounting for roughly 27% of Cambodia’s GDP.

The proceeds are believed to be laundered and channelled to Cambodia’s elite. A 2023 report by the United Nations Office on Drugs and Crime (UNODC) found that the Cambodian government has actively cooperated with criminal organisations, even helping recapture escaped trafficking victims and returning them to their exploiters.

The UN agency warned that “the online-fraud industry in Southeast Asia represents the greatest transnational criminal threat from China to the United States,” comparing it to “the spread of fentanyl trafficking from China to America.”