Welcome to the third Asian Crime Century briefing of 2023. The most troubling stories this week relate to the epidemic of people trafficking across Asia and the human misery that this generates. There are continual reports of poor Asians rescued every week, usually from slavery in Myanmar or Cambodia. Sihanoukville (shown in the picture below) remains a hub for Chinese criminal gangs that are using Asians kidnapped and forced to work in ‘fraud factories’. There are news stories in the past week highlighted here involving victims from Bangladesh, Malaysia, and the Philippines. These cases illustrate only a small part of the problem.
Corruption is seemingly endemic in multiple countries in Asia, but it is notable that the authorities in some countries are willing to take continued strong enforcement action against senior officials and business leaders, illustrated by recent cases reported below in China, Singapore, and Vietnam – The leaders in these countries know that if they do not show that they will have zero tolerance for corruption, business investment will suffer. However, enforcement action alone is not sufficient and an active civil society with freedom for groups to identify and report corruption is also key to reducing corruption.
Cambodia
Bangladeshi nationals are amongst many others from poor backgrounds across Asia who are being sold as cyber slaves to countries such as Cambodia. The Daily Star reports on the case of a 25 year old Bangladeshi who was promised work as a receptionist in Cambodia, but after he arrived in Sihanoukville he was sold as a cyber-slave and tasked with scamming money online from US citizens by pretending to be a young woman in Miami. When he refused to work, he was tortured with beatings, electric shocks, and being locked in a toilet.
The 25 described his experience: “I was given six iPhones and a computer. My first task was to send text messages to more than 500 numbers in the USA on WhatsApp every day. When anyone responded, I had to develop a relationship while pretending to be a young lady. If anyone wanted to talk on a video call, there were women to attend." He was ‘sold’ multiple times to different criminal gangs to work in their fraud factories.
The centres for the trade are in Myanmar, Laos and Thailand, but Cambodia and particularly Sihanoukville are a key part of the problem that has led to human trafficking being described as endemic across Asia. The operators are reportedly Chinese, Taiwanese, and Malaysian gangs that are becoming regional transnational crime groups on the back of this booming criminal business.
China
The former Chairman of China Life Insurance, Wang Bin, has been charged recently with concealing overseas deposits and accepting bribes during his career with various financial institutions. The Supreme People’s Procuratorate announced that Wang was recently prosecuted in Jinan, Shandong Province, on charges including abuse of power in exchange for huge bribes. Caixin first reported the case against Wang in early 2022 when he was placed under investigation by the Central Committee for Discipline Inspection (CCDI), the Chinese Communist Party agency responsible for investigating corruption and misconduct. The investigation followed the discovery of unexplained losses at Taiping Life in Hong Kong, which could amount to 20 billion to 30 billion yuan (US$3.15 billion–$4.73 billion).
Also in January, the CCDI handed over to prosecutors their case against Lu Jun, former head of Sino IC Capital Co. Ltd., who was involved in the management of the biggest state-run semiconductor investment fund. The fund had huge financial support from the Chinese government, with 130 billion yuan (US$20 billion) injected in 2014 and another 200 billion raised in 2019. There are far wider implications from this investigation, which when the court proceedings become public is likely to show wider corruption in the investment sector.
India
India is also suffering from the epidemic of cyber-crime in Asia. Reported cyber-crime increased by over 63% in 2022, with a total of 4,718 cases compared to 2,883 in 2021. The cases include job fraud, cheating in the name of cryptocurrency investment, insurance fraud, sextortion, and electricity bill fraud. In November 2022, hackers infiltrated the servers of the All India Institute of Medical Sciences, leading to interruption of crucial services for weeks, and the data of millions of patients reportedly being compromised. The impact of cyberattacks in India is growing, and it is being questioned as to whether the authorities have the capacity or capability to counter the threat.
Japan
The importance of ‘rare earths’ is highlighted by Thieves in Japan targeting Toyota Prius hybrids for platinum and palladium that have increased in value following the invasion of Ukraine by Russia. In Chiba Prefecture in 2022 there were 173 thefts of mufflers or catalytic converters, about 90% of which were from Toyota Prius vehicles. Japan is not alone in this problem as thefts of catalytic converters, the exhaust emission control devices that reduce pollution, have risen across the world as the prices of platinum and palladium have increased. The war in Ukraine worsened the problem as Russia accounts for about 40% of newly mined palladium and is also a significant platinum producer.
There are indications that the supply of platinum may be reduced even further in 2023, with around 73% of the supply of the mineral coming from South Africa 10% from Russia, and 8% from Zimbabwe. Clearly ‘rare earths’ are called this for a reason, and in 2023 we may see even more hybrid vehicles as well as electric vehicles (with large batteries) being the target of thefts.
South Korea
Major fraud is a problem across Asia, and Korea is no exception. In January, the Supreme Court of Korea upheld the conviction of Lee Byung-gul, the chief executive officer of failed cryptocurrency exchange V Global, who will serve 25 years in prison. Lee was convicted of operating a pyramid scheme between 2020 and 2021 that defrauded about 50,000 investors of 2.8 trillion Korean won (US$2.26 billion). V Global promised 300% returns on investments in its self-issued token V Cash. The exchange required new members to create accounts with a 6 million won deposit (US$4,860) offering a guaranteed return of 18 million won. The V Cash token became worthless when the exchange was shut down in September 2021. V Global was a classic Ponzi Scheme, which although in hindsight rather apparent unfortunately seem to be increasingly common in relation to crypto-currencies.
Malaysia
Two Malaysian women reported the horror of the epidemic of human trafficking in Asia when they were returned home recently. The two were offered work in Thailand, but after they arrived were moved to Myawaddy in Myanmar, where they were held for four months. They stated that the syndicate set a key performance indicator (KPI) for them to earn 70,000 yuan (US$10,000) otherwise they would be forced to work long hours, be punished by being forced to eat pork (forbidden for Muslims), or the threat of rape. They were rescued by the Royal Thai Army whose soldiers entered Myanmar to secure them.
Pakistan
At least 13 people were injured by a bomb that derails a passenger train in Baluchistan Province in Pakistan. The explosion derailed eight train cars, including the engine, highlights the continued terrorist threat in Baluchistan Province, which has a good supply of oil, gas and mineral deposits. Gaining systematic safe access to these resources seems to be unlikely whilst attacks by Baloch separatists continue. In December 2022, the Pakistan military reported that six security personnel “embraced martyrdom” and at least 17 others were injured from a series of terrorist attacks that month.
Philippines
The nexus of corruption and crime is on display in the Philippines as the Bureau of Immigration investigates personnel linked to people trafficking. The investigation is focussed on a Chinese human trafficking syndicate that used Bureau of Immigration officers, four of whom were assigned to Clark International Airport. The criminal group has been luring Filipinos with job offers to work overseas, after which many flew to Cambodia where they have been imprisoned and forced to work in call centres engaged in fraud.
Singapore
The Singapore authorities are taking strong action against offenders in a string of commodities fraud cases. On 17 January 2023, Lulu Lim Beng Kim, former Chief Financial Officer of Agritrade International Pte Ltd, was sentenced to imprisonment for 20 years after being she was convicted of the following charges 11 counts of Cheating and one count of Falsification of Accounts. The Commercial Affairs Department of the Singapore Police Force had investigated Lim and others for trade financing fraud and fake documents submitted to financial institutions relating to AIPL, a Singapore-incorporated company that traded in coal, palm oil and other commodities. 16 financial institutions granted over USD 586 million in credit facilities to AIPL, which defaulted on the loans causing losses to the financial institutions of around USD 469 million. Despite there being an uptick in major commercial crime cases, the Singapore Police and other government agencies will take strict enforcement action in the city to reinforce the reputation of Singapore as a well governed financial centre.
Thailand
The problem of collusion by government officials and criminals in Thailand was again illustrated as 15 Thai officials were charged with corruption after two Chinese suspects walked free from a raid on a passport-forging den. The case followed a raid by Thai police on the former consulate of Nauru (a Pacific island state) in Bangkok in December 2022, where they found two Chinese men forging passports. The two Chinese males are wanted by the authorities in Beijing, but escaped from custody with the collusion of five officials from the Department of Special Investigation as well as nine police officers and a military sergeant, who had extracted a bribe of 10 million baht (US$245,000) from the suspects.
This case comes as a video has gone viral in China suggesting that Chinese tourists to Thailand can purchase VIP services from the Royal Thai Police on arrival in the country. The video, on TikTok, shows several young Chinese women arriving in Bangkok and receiving a VIP welcome from police and officials including being given priority access to immigration services, assistance with luggage and a police motorcycle escort from Suvarnabhumi Airport into the capital. National Police Commissioner General Damrongsak Kittiprapat has ordered an investigation, but these cases do great damage to the reputation of the Thai police as well as Thailand in regard to the extent of corruption.
Vietnam
The recent resignation of President Nguyen Xuan Phuc is reportedly due to the alleged involvement of his wife and relatives in recent high profile corruption cases involving fraud relating to COVID-19 test kits. In March 2020, Vietnam announced locally-produced COVID-19 test kits that met the standards of the World Health Organisation, made with US$800,000 in government financial support in a joint project between the Military Medical Academy and private firm Viet A. The scheme led to a massive fraud involving millions of test kits sold at inflated prices. The involvement of government corruption has already led to the arrest of 130 government officials, diplomats and business people, including former Health minister Nguyen Thanh Long and Science and Technology Minister Chu Ngoc Anh. GDP in Vietnam grew by 8% last year, and the government is likely to continue to take a hard line against corruption to enhance the reputation of the country as a location where corruption by officials is not tolerated.