Cambodia: Asia’s New Fraud Capital – OpEd

A French diplomat staying in a riverfront hotel in the Cambodian capital is attracted by the rate board on the massage parlours . ‘5 US dollars for oil massage (1 hour)’ board draws him into one of the parlours. He hangs his bag and clothes and hits the bed. The petite lady masseur offers a aromatic handkerchief and the unsuspecting Frenchman falls fast asleep after inhaling the aroma.

When he is woken up after an hour by the masseur with a shrill “massage fini” shout, the Frenchman draws on his wallet and pays the equivalent of 5 US dollars in local currency. 

Back in his hotel, as he retires for the day, the Frenchman checks his wallet to figure out if he needs to change some more currency. 

Nothing wrong, his 30 odd 100 dollar bills are intact.

But as he walks into a money changer counter next morning, the Frenchman is in for a shock. “Copy dollar these,” screams the moneychanger.”Not real dollars, copy man.” The word “Copy” is clearly inscribed on the greenback.

As the Frenchman argues that all his dollars are from his bank back in France, the moneychanger threatens to take him to police for selling fake dollars.

The Frenchman, a diplomat who came to attend an UN conference, then realises what has happened. His currency notes were changed at that 5 dollar massage parlour, dozens of which dot the Phnom Penh riverfront.

As he goes to the local police station to complain, the cops are less than cooperative. “How do we know you have not brought these fake dollars,” says one cop in halting English. His diplomatic passport does not help as the cops are reluctant to register a case. Clearly, the parlours function under their protection and they get a cut of the loot. 

Back in the hotel, as the Frenchman shares his torrid experience over breakfast, a Chinese diplomat attending the same conference, shares a similar experience. “I lost 5000 dollars the same way in a similar parlour,” says the Chinese diplomat.

A UN conference with dozens of delegates must be great business for these riverfront parlours, considering the value of dollar in Cambodia (4052 KHR for one US dollar). 

The French and the Chinese diplomats opened up, others might not. The Chinese diplomat said one of his trader friends lost 18000 US dollars from his hotel room safe, insisting he was too busy to visit parlours on a short business trip and that the replacing of real with “copy” dollars (the word copy boldly printed) must have happened in his room safe.

An Indian trader I know was nearly dragged to airport police when he tried to pay a 100 dollar note for his Hennessey cognac at the Phnom Penh airport duty free and it turned out to be copy. But he insisted he has had no time to visit massage parlours because of business negotiations — so he suspects the changeover happened in his hotel room locker in the same riverfront hotel where the French and the Chinese diplomat was staying.  “I suspect they have a way of cloning the code I used to lock the room safe,” says the trader.

None are willing to be quoted because this may impact their Cambodian visas in future or they don’t want to publicly admit visiting  shady massage parlors looking for cheap sex, which they never get because the aroma handkerchief takes care of it.

Considering the tourism is Cambodia’s leading industry and foreign exchange earner, it is strange the authorities turn a blind eye to what is obviously a burgeoning currency fraud industry that involves many from the masseurs to their parlor owners to the fake currency handlers to the policemen who turn away complainants, mostly foreign tourists.

Cambodia’s tourism earned gross revenue of $3.04 billion in 2023, up 115 percent from $1.41 billion in a year earlier, according to a Ministry of Tourisms report released on February 12, 2024.

The kingdom received 5.45 million international tourists last year, up 140 percent from 2.27 million in the year before, the report said.

“Averagely, a tourist stayed 7.6 days in Cambodia,” the report said.

The Southeast Asian country launched the 2024 Cambodia-China People-to-People Exchange Year last month, hoping that the initiative would be a catalyst for increased tourism and investments.

“I’m strongly confident that the initiative will become a new driving force to attract more Chinese tourists and investors to Cambodia,” Cambodian Tourism Minister Sok Soken said at the launching event held in the cultural province of Siem Reap.

China was the third largest source of foreign tourists to the kingdom in 2023, the report said, adding that the country welcomed 547,798 Chinese visitors last year, up 412 percent from only 106,875 in a year earlier.

Tourism is one of the four pillars supporting Cambodia’s economy.

The country has four world heritage sites, namely the Angkor Archaeological Park in northwest Siem Reap province, the Temple Zone of Sambor Prei Kuk in central Kampong Thom province, and the Temple of Preah Vihear and the Koh Ker archaeological site in northwest Preah Vihear province.

Indian foreign ministry says more than 5,000 Indians are trapped in Cambodia, held against their will and forced to carry out cyber frauds on people back home. The government estimates that the fraudsters have allegedly duped people of at least Rs 5 billion in India over the past six months.

Some Chinese nationals are also there but it is not clear whether they are held against will or are willing accomplices or masterminds of such global cyberfrauds operations.

Earlier this month, the Indian Home ministry held a meeting with officials of the Ministry of External Affairs (MEA), Ministry of Electronics and Information Technology (Meity), the Indian Cyber Crime Coordination Centre (I4C) and other security experts to draw up a strategy to rescue the Indians trapped in 

“The agenda of their meeting was to discuss the organised racket and bring back those who are trapped there. Data shows that Rs 500 crore has been lost (to cyber fraud originating in Cambodia) in India in the last six months,” a top official said.

He said  that the investigation by Central agencies has so far revealed that agents were trapping people, mostly those from the southern part of the country, and sending them to Cambodia on the pretext of data entry jobs before forcing them to carry out cyber frauds.

The source said those trapped in Cambodia were forced to scam people back in India and, in some cases, extort money by pretending to be law enforcement officials and saying that they had found some suspicious materials in their parcels.

So far, three people from Bengaluru in south India who were trapped in Cambodia have been brought back to India.

The matter came to light after the Rourkela Police in Odisha busted a cyber-crime syndicate on December 30 last year, arresting eight people who were allegedly involved in taking people to Cambodia.

Sharing details of the Rourkela Police’s operation, an officer said the case was based on the complaint of a senior Central government officer who had been duped of around Rs 70 lakh. “We arrested eight persons from different parts of the country and we have prima facie evidence against multiple people who are involved in the scam. We issued Look Out Circulars against 16 people, following which the Bureau of Immigration this week detained two persons, Harish Kurapati and Naga Venkata Sowjanya Kurapati, at the Hyderabad airport while they were returning from Cambodia,” the officer said.

One of the rescued men, Stephen, told ‘Indian Express’ newspaper :  “An agent in Mangaluru offered me a data entry job in Cambodia. I have an ITI degree and did some computer courses during Covid. There were three of us, including someone called Babu Rao from Andhra. At the immigration, the agent mentioned that we were going on a tourist visa, which raised my suspicion. In Cambodia, we were taken to an office space, where they held an interview and the two of us cleared it. They tested our typing speeds etc. It’s only later that we got to know that our job involved looking for profiles on Facebook and identifying people who can be scammed. The team was Chinese, but there was a Malaysian who translated their instructions to us in English.”

Talking about his daily schedule, Stephen said, “We had to create fake social media accounts with photographs of women sourced from different platforms. But we were told to be careful while picking these photos. So a South Indian girl’s profile would be used to trap someone in the North so that it did not raise any suspicion. We had targets and if we didn’t meet those, they would not give us food or allow us into our rooms. Finally, after a month and a half, I contacted my family and they took the help of some local politicians to speak to the embassy,” he said.

Odisha police official say that the accused were agents who took men — potential scamsters — to Cambodia on the pretext of jobs. “But once they land in Cambodia, they are made to join these companies that indulge in fraud. The companies take away the passports of these men and make them work 12 hours a day. If anybody refuses to do the work that is asked of him, he is tortured by way of physical assaults, electric shocks, solitary confinement, etc. Many Indians who are not willing to engage in such scams are trapped there. We are trying to identify them, contact them and try to bring them back to India through proper channels,” Padhi said.

Talking about the nature of the scam, the officer said the men were initially made to join a “scamming company” in Phnom Penh in April 2023.

There, the scamsters were forced to pose as women on dating apps and chat with their potential targets. “After some time, the scamster would convince his target to invest in cryptocurrency trading. This way, many people were duped in India,” Padhi said.

According to the Rourkela Police, in October 2023, the agents got the men to join another company which focused on investment scams. “This company lured people to invest in fake stocks. They also created a fake online app,” the officer said.

“We have also gathered critical information regarding the location of the fraud companies, their operatives, their working style and their management hierarchy. We have identified three key high-level operatives of Indian origin and one high-level operative who is of Nepalese origin. We intend to take the help of Interpol to arrest key players in this scam,” Padhi added.

It is not clear whether these fraudsters are also connected to the fake currency rackets and what kind of local patronage they enjoy. But without such patronage,  it would be unlikely they carry on so long and so brazenly.