US sanctions Cambodian senator tied to crypto scam centers as DOJ restrains $700M in broader crackdown

The U.S. Treasury’s Office of Foreign Assets Control (OFAC) has sanctioned a Cambodian senator accused of running "scam compounds" that have been defrauding Americans, convincing them to send crypto with promises of high returns.

OFAC said in a statement on Thursday that it has sanctioned Kok An, "who controls scam compounds throughout the country," along with businessman Rithy Raksmei and another 28 individuals and entities that are allegedly part of his network.

As part of the same coordinated crackdown, the U.S. Department of Justice’s Scam Center Strike Force restrained more than $700 million tied to alleged money laundering from Southeast Asia-based crypto investment scams and seized hundreds of websites targeting American victims.

The move follows police raids on two scam centers in Poipet, a Cambodian city near the Thai border. Last year, An was accused by police of running scam centers in Poipet, according to The Diplomat.

OFAC says Americans, lured by friendship or romantic relationships, have been robbed of millions of dollars. The fraudsters convince victims to send money in the form of crypto under the guise of legitimate investment platforms that can earn considerable returns, the agency said.

"In some cases, individuals perpetrating these scams are themselves victims of human trafficking and are forced to commit unlawful acts under threat of violence," OFAC said. "Kok An and his affiliates’ network of scam centers, operating out of casinos and office parks retrofitted for fraudulent activity, launder victims’ funds and provide a base to target U.S. citizens and commit human rights abuses with impunity."

The Strike Force's actions included criminal charges against two Chinese nationals linked to a scam compound in Burma, the seizure of a Telegram channel used to recruit trafficked workers for fraud operations in Cambodia, and the takedown of 503 websites posing as cryptocurrency investment platforms, the DOJ said in a separate statement on Thursday.

According to the statement, federal prosecutors unsealed criminal complaints and arrest warrants against Huang Xingshan, also known as "Ah Zhe" and "Huang Xing Saan," and Jiang Wen Jie, also known as "Jiang Nan," charging both with wire fraud conspiracy.

The DOJ said the seized Telegram channel maintained a following of more than 6,000 individuals and served as a recruitment tool for a "law enforcement impersonation" scheme. Scammers used the platform to lure workers to a Cambodian compound where they were forced to pose as representatives from JPMorgan or the NYPD to induce victims into transferring their savings.

Meanwhile, the State Department is offering a reward of up to $10 million for information leading to the seizure or recovery of proceeds from fraud and money laundering schemes associated with the Tai Chang scam centers in Burma's Karen State.

'Scambodia'

In a recent report from The Wall Street Journal on the scamming industry in Cambodia, An was mentioned alongside Chinese immigrants Xu Aimin and Chen Zhi, both of whom operate in Cambodia and are believed to be connected to the scam compounds. 

"Predominantly Chinese syndicates operating in Cambodia have grown so enormous in scale that some foreign politicians refer to the country of 18 million people as 'Scambodia,'" according to the report.

Last September, OFAC sanctioned an extensive network of cyber criminals across Southeast Asia, which included ten targets based in Cambodia.