Cambodian crime syndicate sanctioned for forced labor in crypto scam; US victims lose billions – DL News

The US has imposed sanctions on Cambodian crime syndicates that use forced labor to carry out crypto scams that have cost victims billions.

The sanctions are aimed at stopping both human trafficking and fraudulent investment schemes. The Justice Department cited widespread corruption and exploitation of people forced under harsh conditions to run online crypto scams.

The Cambodian groups committed crypto investment scams that contributed to a 53% increase in crypto-related investment losses in 2023 to nearly $4 billion, according to the FBI's Internet Crime Complaint Center.

This follows a steady rise in crypto investment scams, with losses increasing from $1.56 billion in 2021 to $2.57 billion in 2022. Taking the latest figures into account, the overall increase from 2021 to 2023 represents a staggering 154% increase.

Without stronger enforcement by government authorities, the upward trend is unlikely to reverse itself.

Erin West, a district attorney in Santa Clara, is addressing this growing crisis. As a key figure in the fight against crypto scammers, West has highlighted the enormous scale of the problem. “I talk to victims all day, every day – it's a real flood of people,” she said, referring to the large number of cases she handles.

The challenge in combating these scams is that they are international in nature, with victims often being defrauded by syndicates operating from countries such as Cambodia, Laos and Myanmar.

Workers lured with the promise of legal jobs are kidnapped and forced into slave-like conditions where they must run crypto scams. “There is only one group that is winning, and that is an international organized crime syndicate,” West said.

Not only have these crimes cost billions to unsuspecting victims, they have also highlighted the human cost as victims of trafficking are coerced into participating in these operations.

West added that there is a stigma attached to victims of crypto scams that makes reporting difficult. “It's a game of speed,” she explained. “The sooner victims report it, the more likely we are to get their money back.”