The scam factories

Cambodia’s cyberscam industry by its very nature operates in the shadows –  and often on an industrial scale. Hundreds of compounds have been constructed across the country and an estimated hundreds of thousands of foreign workers have arrived — willingly or not, to serve it. But a flurry of videos on social media at the start of the year showed people fleeing en masse through Cambodian fields, signalling that something is dramatically changing in the sector.

In the past there had been cases of foreign workers protesting or running away. But the sheer volume of videos posted in January — people hauling luggage over their heads, dropping their mobile phones as they run, or backing away from security guards wielding batons — was new.

Cambodia, internationally known for its ancient temples and the genocidal Khmer Rouge government of the 1970s, has become notorious as one of Southeast Asia’s cyberscam hubs, alongside Myanmar and Laos. For about five years now, “scamming” — online fraud — has been booming there. Workers from various countries are recruited for this purpose, often with false promises. They are then frequently forced to toil under terrible conditions that are reminiscent of modern slavery.

As part of a reporting team for a local news outlet in the capital of Phnom Penh, we first noticed that something was going on in 2021:  Chinese-speaking journalists detected young Chinese citizens’ cries for help on social media. These people, including minors, said they had been trafficked into Cambodia, then forcibly employed by shadowy scam call centres to build virtual relationships with people in China, the U.S. and other locations, with the aim of tricking victims out of money. Low-level workers said they were not even getting paid: they were forced to work to avoid beatings and stay alive. These workers were enslaved to be scammers.   

Scamming is called “Pig butchering,” a term that came from Chinese slang 

The scamming industry has diversified in recent years and involves many nationalities. Some workers were recruited for promising salaries, significantly above what they could earn in their home job market, for example, in Indonesia, Vietnam or Pakistan. Some people were recruited from African countries and told they would work in, for example, construction or a restaurant — some even expected to end up in a different country. 

“Pig butchering” emerged as the nickname for the sector. It is derived from a Chinese slang term used by the scammers themselves to describe their method of “fattening the pig,” forging a connection over time with a target, then going in for “the kill,” coaxing the person to invest in the fraudulent scheme. This is the classic playbook, but the Cambodian scam ecosystem is vast and ever-changing. Fraud startups are sprouting up like spores. Tactics range from promising people nonexistent online jobs to fake romances to scams where workers impersonate police in order to extort a victim. We’ve even seen recovery scams, which target financial fraud victims a second time by making them believe they can regain their losses.

One pattern links all the scams: their psychological effectiveness. Lies are supported by so much enthusiasm, thoughtfulness and time that many scammers’ targets succumb. At the end of their ruse, people often lose large sums of money, ranging from a few hundred dollars to losses of more than a million, as reported by some U.S. victims.

The Cambodian government initially denied the trend but has since acknowledged some aspects of the industry. However, secrecy and silencing continue: Some whistleblowers have been punished. Local journalists have recently been arrested, detained or charged for investigations into suspected scam locations.

Meanwhile Cambodia’s government is pledging a crackdown. Prime Minister Hun Manet has said the scam industry has given the nation a “bad reputation”.  In early January, news broke of the deportation of Chen Zhi, a Chinese tycoon and alleged kingpin of a large Cambodian conglomerate involved in the scam industry. The company he heads, which includes shopping malls, hotels and real estate businesses, was accused of running scam enterprises underneath its licit businesses. His face and company logo used to be all over Cambodian media, up until the U.S. and U.K. governments sanctioned him and a list of associated individuals and businesses that formed part of the “Prince Group Transnational Criminal Organization”. His arrest was unprecedented – a reckoning for a figure who has close government ties and was perceived as immovable. Since then, the Cambodian government has scaled up raids on scam businesses.

The mass escapes that circulated online came on the heels of Zhi’s deportation and a new law that fines property owners for hosting foreigners without their proper documents. Rumour channels on social media claim that scam bosses, worried about the developments, fled their workplaces. They left once-detained workers to negotiate their own way back to Phnom Penh.

As a reporter covering this topic for years, I’ve met countless victims of trafficking and forced labour from these compounds, who often provided off-the-record insights into the murky trade. Usually it takes time to find and build trust with these sources, who are often scared and defensive. Before this year, I’d never met so many gathered in one place. In January, I walked into the vestibule at the International Organization for Migration (IOM) office in Phnom Penh and met about a dozen foreigners from Africa, stuck in Cambodia with varying overstay issues. Among them was Sam, one of many Ugandan citizens who asked not to be fully identified as he showed me a passport lacking any Cambodian entry stamps. “At first, when we got away and everyone was happy,” he said. “Now, everyone is thinking: how are we going to go home?”

Poor-performing workers are tasered, humiliated or handcuffed and shut in dark rooms

He and others shared similar stories of being smuggled in from Vietnam, probably through the Mekong River Delta. People from Kenya and elsewhere in Africa said they landed at Phnom Penh airport, but were stopped by apparent officials, shuffled past immigration stations and put in vans to scam companies. Many said their passports were confiscated by their managers and were never returned.

Many workers are tricked into the jobs and are psychologically manipulated. Their day-to-day work is normalised to hide the deceit. Whether they are small start-ups or sprawling enterprises with hundreds of workers, sometimes in huge multi-building compounds, these grim operations often take place in mundane spaces with white walls, black office chairs and rows upon rows of monitors, computer stacks and keyboards. Some of the equipment recently confiscated looked like it could have hailed from any office in Phnom Penh, computers personalised with stickers of anime shows or a Tesla logo.

The language used by this business is similarly sanitised. People who buy and sell workers like cattle are called “HR” and the scam workers themselves are said to be working in “customer service” or “optimisation”. A scam compound is a little like a Starbucks, because from the inside it feels like you could be anywhere in the world. And of course there is a hierarchy:  the talented workers will earn the promised salary and commission and even get placed in rankings displayed on the wall. Poor-performing workers, however, face the brunt of the exploitative set-up: they are tasered, humiliated or handcuffed and left alone in a dark room. “It’s a good day when nothing happens to you,” Sam explained to me.

Now amid uncertainty about the future, workers en masse are on the run, hiding in hotels or waiting for deportation — or the next scam gig. Observers of the industry are unsure what will come next. Some say it will return to its former scale while others think this could be the end, at least of the large-scale scamming mills. For now, what’s clear is the lasting psychological damage caused by this industry. Fraud targets often suffer long after the scams end, as do workers, whether they return home, are imprisoned or begin another exploitative job. Sam is still waiting in Phnom Penh, wondering how his family will be able to afford his flight ticket home. “I thought I was free,” he said, then added that he first has to somehow manage to get home to really escape.