Thousands of Indians Trapped in Crypto Fraud Rings in Southeast Asia: Report

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Jimmy Aki

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Jimmy Aki

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Jimmy has nearly 10 years of experience as a journalist and writer in the blockchain industry. He has worked with well-known publications such as Bitcoin Magazine, CCN, and Blockonomi, covering news...

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October 2, 2024

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Thousands of Indian residents are falling victim to fake job offers, which promise high-paying positions but instead trap them in Southeast Asia’s crypto fraud and cybercrime rings.

Government Rescue Efforts and Countermeasures

Reports from local media suggest that these victims are forced into online scams such as crypto fraud, phishing schemes, and pig butchering scams. They work in call centers targeting individuals, mainly Indians, posing as investment advisors or fake tech support.

According to sources, approximately 45% of cybercrimes against Indians originate from countries in Southeast Asia, including Cambodia, Laos, and Myanmar. Many of them travel to these countries in search of legitimate jobs but are subsequently detained once they arrive in the country.

After being detained, victims are forced to participate in cyber scams, mainly targeting Indians back home. They are coerced into making scam calls or creating fake social media profiles, often impersonating women to lure victims.

These scams range from fake cryptocurrency investments to dating schemes. Once the victims deposit money, they are ghosted, and their contact information is blocked. The scammers confiscate the victims’ passports, trapping them in guarded compounds and forcing them to continue the fraud.

A report indicated that between October 2023 and March 2024 alone, Indian citizens lost around INR 500 crores (about $60 million) in scams linked to these operations.

The scale of the problem has led the Indian government to take action. International collaboration is underway between India, Southeast Asian authorities, and non-governmental organizations to rescue the trapped individuals.

In August, several Indian nationals were rescued from scam centers in the Bokeo province of Laos. Following this, the Indian Embassy in Laos issued a public warning, advising citizens to verify job offers before traveling abroad, particularly on visas granted upon arrival.

One major concern is the number of Indian nationals who traveled to Southeast Asian countries from January 2022 to May 2024 but are yet to return.

Reports estimate nearly 30,000 Indians remain unaccounted for, many of whom could still be trapped in these scam networks.

To address the issue, the Indian government has formed an inter-ministerial panel tasked with cracking down on cyber slavery networks and repatriating the victims.

Links to Human Trafficking and International Crime

Investigations have shown that these cybercrime networks often have deeper ties to other criminal activities, such as human trafficking and labor exploitation.

The U.S. government has also taken steps to address this issue, particularly through sanctions. In a recent case, a Cambodian senator was sanctioned by the U.S. Department of the Treasury for his links to cyber-scam centers and human trafficking. The investigation revealed a larger network of human trafficking, with victims held in walled compounds and subjected to physical abuse and drug use.

In May, Tether froze $5.2 million in USDT, which had been laundered from many phishing schemes. This move aligns with the company’s efforts to combat illicit activities and enforce strict network controls.

Notably, India ranks fifth globally in cryptocurrency-related complaints, with 840 cases disclosed in the Federal Bureau of Investigation (FBI) report that showed $5.6 billion lost to crypto fraud. The financial losses of $44 million placed India among the top ten countries with the highest losses.

One of the largest scams in India was the 2018 GainBitcoin Ponzi scheme, where Amit Bhardwaj defrauded over 8,000 people, leading to losses of INR 2,000 crore.

The Reserve Bank of India continues to warn against cryptocurrencies, saying they pose serious financial risks.