The United Nations (UN) has issued a serious warning about the activities of cryptocurrency criminals and scammers in Southeast Asia. According to the UN, these criminals have continued to grow, expanding their operations using digital assets and custom blockchain services.
The report mentioned that criminals are expanding their exploits and they are doing it through the use of digital assets. Even though authorities have been increasing efforts to arrest them, they have been spreading their networks globally, moving from Myanmar to Mexico, the report mentioned.
United Nations warns about the rising activities of scammers in Southeast Asia
According to the data revealed by the United Nations, most of these criminal gangs are located in Southeast Asia, where most of their activities have been largely successful. The report mentioned that regional fraud has replaced other types of crimes as these criminals can easily reach their victims online. The report mentioned that victims lost about $37 billion to cyber fraud in East and Southeast Asia in 2023, with most of the losses linked to crypto scams.
Benedikt Hofmann, the United Nation’s acting regional representative for Southeast Asia, mentioned to Reuters that the operations are spreading like a cancer. The expansion, largely helped by the anonymous quality of digital assets, has made it hard for global governments to contain the issue. As law enforcement continues to combat these crimes in known areas, the criminals are relocating their base of operation, with others moving their operations online.
Most of these scammers are also known to use technologies like Starlink satellites to bypass government restrictions. This [scale of Southeast Asia’s scam network] has extended far beyond the construction and management of physical scam centers to include online gambling platforms and software services, unlicensed payment processors and cryptocurrency exchanges, encrypted communications platforms, and, most recently, stablecoins, blockchain, networks, and illicit online marketplaces, often controlled by the same criminal networks,” the report said.
UN report highlights the rise of illegal exchanges
The United Nations report also discussed the rise in illegal exchanges, noting that they help these scammers with their operations. Huione Guarantee, a platform that has now changed its name to Haowang, is known to offer several services that help scammers carry out their activities. The platform has links to several countries and has processed billions of crypto transactions since 2021.
The platform provides services to help these scammers, including launching US dollar-backed stablecoins that help them escape government controls. The platform has also grown, boasting about 970,000 users. Most of these users are involved in one illegal activity or another. The United Nations report notes that traders on Huione have received about $24 billion in the last four years.
The report mentioned that the rise in crime rate recorded in Southeast Asia results from corruption and weak governance in some areas. This has led to criminals setting up shop in some countries and recruiting people to work for them under forced conditions. The UN report mentioned that there were victims from more than 55 countries, including Africa, with the scammers using them to trick victims into sending money, usually through digital assets.
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