Evergreen explainer. Scam compounds across Southeast Asia are the sites of industrial-scale online fraud where, according to the UN and the U.S. government, many workers are trafficked, confined and forced to defraud strangers online. The crime has two sets of victims: the people defrauded, and the people coerced into defrauding them. This page sets out what the UN has documented, what the U.S. alleges in the Prince Group case, how Cambodia and the company respond, and what cannot yet be verified. It covers developments up to September 30, 2026.
It is one of four explainers that start from the U.S. State Department’s Bureau of Democracy, Human Rights, and Labor (DRL), whose Office to Monitor and Combat Trafficking in Persons publishes the annual Trafficking in Persons (TIP) Report. U.S. statements are presented as one party’s findings and are paired with UN, research and Cambodian government sources. See the Investigations hub for the series.
Contents
- 1. Key takeaways
- 2. How the compounds work
- 3. Documented, alleged and disputed
- 4. What the UN documented
- 5. The U.S. case: TIP Report, Prince Group and sanctions
- 6. Responses from Cambodia and Prince Group
- 7. Scale and spread
- 8. Timeline
- 9. Frequently asked questions
- 10. Key sources and related coverage
- 11. Note on method and status
1. Key takeaways
Key takeaways
- UN finding: In August 2023 the UN human rights office said hundreds of thousands of people were being forcibly engaged in online criminality in Southeast Asia, citing “credible sources” for at least 120,000 people in Myanmar and around 100,000 in Cambodia. It stressed that coerced workers are “victims. They are not criminals.”
- Two sets of victims: U.S. figures say Americans lost at least $10 billion to Southeast Asia-based scam operations in 2024, and UN investigators say the workers running the scams often suffer torture, detention and sexual violence.
- U.S. allegations are not verdicts: In October 2025 the U.S. and U.K. sanctioned Cambodia’s Prince Group as a transnational criminal organization, and U.S. prosecutors indicted its chairman, Chen Zhi, on wire-fraud and money-laundering conspiracy charges. Prince Group has denied involvement in scam operations. No U.S. court has ruled.
- Cambodia’s stance: Officials first said Prince Group met legal requirements, then in February 2026 Prime Minister Hun Manet said the government “did not know that he was the kingpin.” Chen was extradited to China after losing Cambodian citizenship.
- Weak data: Victim and revenue figures are estimates built on clandestine activity. Higher figures in circulation rest on single think-tank reports we did not open.
120,000+
Myanmar estimate
OHCHR, 2023, “credible sources”
~100,000
Cambodia estimate
OHCHR, 2023
~$40bn
Annual profits
UNODC estimate, April 2025
146
Prince Group targets
OFAC, 14 Oct 2025
2. How the compounds work
According to OHCHR’s 2023 briefing paper, recruiters lure people, often with fake job offers posted online, to destinations in Southeast Asia. On arrival they are held in compounds and forced to run “romance-investment” scams, crypto fraud and illegal gambling. The UN office says many victims are well educated, computer-literate and multilingual, and come from across the ASEAN region as well as mainland China, Hong Kong, Taiwan, South Asia, Africa and Latin America. Most are men, though women and adolescents are among them, and most are not citizens of the country where they are held.
The U.S. State Department’s 2025 TIP Report describes the same pattern as “forced criminality,” in which “traffickers lure individuals through fake job offers and then force them – through physical violence, restricted movement, and the withholding of food and water – into operating internet scams.” It adds that some operations use AI-translated scripts and language models to target victims. OHCHR says the pandemic pushed casino operators into less regulated border areas and special economic zones and into the online space, and that recruitment of stranded migrants followed.
3. Documented, alleged and disputed
| Claim | Status | Who says it | Notes |
|---|---|---|---|
| Hundreds of thousands forced into online scam work across Southeast Asia | UN estimate | OHCHR, Aug 2023 | Based on “credible sources”; OHCHR says the scale is hard to measure. |
| Workers face torture, detention, sexual violence and forced labor | UN report | OHCHR, Aug 2023 | Stated as abuses “many” victims suffered; based on victim testimony and open sources. |
| Annual profits of just under $40 billion across hundreds of centres | UN estimate | UNODC, Apr 2025 | An estimate, not an audited figure. |
| Cambodian officials owned properties used by scam operators | U.S. government finding | State Dept TIP Report 2025 | One party’s finding. Cambodian authorities deny that the government profited. |
| Prince Group runs at least 10 scam compounds with trafficked workers | U.S. and U.K. allegation | U.S. Treasury, DOJ indictment | Allegation in an indictment. Prince Group denies involvement; no trial. |
| The U.S. seized about $14 billion in bitcoin linked to Chen Zhi | U.S. claim; contested | U.S. prosecutors; China’s cyber agency disputes | China’s cybersecurity agency accused Washington of orchestrating the “theft” of the funds years earlier (reported by CamboJA). |
| Over 300,000 people enslaved; $60 billion a year | Single-source | U.S. Institute of Peace, cited by The Diplomat | We did not open the USIP report. Treat as unverified. |
4. What the UN documented
OHCHR’s briefing paper, “Online Scam Operations and Trafficking into Forced Criminality in Southeast Asia,” was issued on 28 August 2023, and its press release followed on 29 August. The paper says the human rights concerns have arisen since early 2021 and that scam operations in Cambodia date back more than a decade, with a sharp increase since 2016. It says conditions in Myanmar are reported to have worsened since the February 2021 military coup.
- Scale: at least 120,000 people across Myanmar “may be held in situations where they are forced to carry out online scams,” and about 100,000 in Cambodia, with tens of thousands involved in Lao PDR, the Philippines and Thailand.
- Abuses: torture and cruel, inhuman and degrading treatment, arbitrary detention, sexual violence and forced labor.
- Legal failures: some states’ anti-trafficking laws “fall short of international standards,” and implementation has not matched the sophistication of the scams. Victims are sometimes treated as criminals or immigration offenders and prosecuted rather than protected.
People who are coerced into working in these scamming operations endure inhumane treatment while being forced to carry out crimes. They are victims. They are not criminals.
UN High Commissioner for Human Rights Volker Türk, OHCHR press release, 29 August 2023
The paper recommends applying the “non-punishment principle,” so that trafficked people are not penalized for crimes they were forced to commit. The same idea appears in the U.S. TIP Report’s discussion of forced criminality.
5. The U.S. case: TIP Report, Prince Group and sanctions
The Trafficking in Persons Report
DRL’s TIP Office produces the annual report that ranks governments in tiers under U.S. law. The 2025 edition places Burma, Cambodia, Laos and China among the 20 countries and territories in its Tier 3 list. Tier 3 can trigger restrictions on some foreign assistance, but the law lets the President waive them. The Diplomat argued in 2024 that waivers are “virtually guaranteed for most Tier 3 countries each year,” which critics cite as a reason the ranking rarely changes behavior. The ranking is a U.S. assessment, and governments ranked low often contest it.
The 2025 report says “in Cambodia, senior officials owned properties used by online scam operators to exploit victims in forced labor and forced criminality,” and notes that scams netted criminals an estimated $25 billion to $64 billion globally in 2023 and defrauded U.S. citizens of $10 billion in 2024, which it calls “likely a low-end estimate.” It also lists, as a 2024 milestone, the first use of Global Magnitsky sanctions for forced labor in online scams.
Prince Group
On 14 October 2025 the U.S. Treasury’s Office of Foreign Assets Control (OFAC), with the U.K.’s Foreign, Commonwealth and Development Office, designated 146 targets as the Prince Group Transnational Criminal Organization, which Treasury says is led by Cambodian national Chen Zhi and includes Phnom Penh-based Prince Holding Group. Treasury says the group operates scam compounds “reliant on human trafficking and modern-day slavery” and alleges “industrial-scale trafficking, torture, and extortion of enslaved workers” at no fewer than ten compounds in Cambodia. The same day the Financial Crimes Enforcement Network (FinCEN) cut Huione Group off from the U.S. financial system, saying it laundered at least $4 billion of illicit proceeds between August 2021 and January 2025.
In parallel, the Justice Department unsealed an indictment in Brooklyn charging Chen with wire-fraud conspiracy and money-laundering conspiracy. AP reported that Chen was at large at the time and, if convicted in the U.S., faces up to 40 years in prison. AP and CNA reported that U.S. authorities seized more than $14 billion in bitcoin. The U.K. froze Chen’s British assets, including a mansion and an office building in London, AP reported.
Treasury has kept up pressure. On 23 June 2026 it sanctioned nine individuals and 26 entities linked to Prince Group and proposed extending the Huione rule to H-Pay Service PLC. It said those actions followed a 23 April 2026 designation of Cambodian senator Kok An and his network, and were taken under an executive order of 6 March 2026 on combating cybercrime and fraud against Americans.
6. Responses from Cambodia and Prince Group
- Prince Group: AP reported that Prince Holding Group had “previously denied involvement in scam operations” and had not publicly responded to the October 2025 allegations. Later AFP and CamboJA reporting repeats that the group denies the allegations.
- Cambodia, October 2025: Interior Ministry spokesman Touch Sokhak said Prince Holding Group had met all legal requirements to operate in Cambodia, that Chen’s citizenship was granted lawfully, and that Cambodia would cooperate if there was a formal request backed by evidence. “We do not protect individuals who violate the law,” he said. He stressed that Cambodia’s government itself does not accuse the group or Chen of wrongdoing.
- Cambodia, February 2026: Prime Minister Hun Manet told AFP in Brussels, “We did not know that he was the kingpin.” He said a background check “did not raise red flags,” that Chen was arrested on 6 January 2026 and extradited to China rather than the United States because he held only Chinese nationality after being stripped of Cambodian citizenship, and that the government had not profited from scams, while acknowledging they had indirectly boosted some sectors such as real estate and construction. He called the scam industry a “black economy.”
- Crackdown claims: Cambodian officials say a nationwide crackdown has halved online scam activity since the start of 2026. Senior Minister Chhay Sinarith called the figure a “preliminary estimate” without describing the method. Observers quoted by CamboJA questioned how durable the campaign is and called for investigations of elites linked to scam operations. We found no independent verification of the 50 percent claim.
AP also quoted a former anti-trafficking worker, Mark Taylor, who said Chen was embedded in the Cambodian elite and “well protected.” That is one expert’s view, and Cambodian officials reject the suggestion of official complicity.
7. Scale and spread
UNODC’s April 2025 report, “Inflection Point,” said East and Southeast Asian organized crime groups are “hedging” beyond the region as crackdowns intensify, moving into remote or weakly governed areas and other regions. It described hundreds of industrial-scale scam centres generating just under $40 billion in annual profits, and said crackdowns disrupt operations that then “continuously reappear” in new business parks. UNODC’s acting regional representative, Benedikt Hofmann, said that “it spreads like a cancer.” UNODC also pointed to centres in Africa, South Asia, the Middle East and Pacific islands, and to laundering and recruitment services as far afield as Europe and the Americas.
That spread is why the issue now appears in U.S. domestic politics. The U.S. frames scams as a cybercrime and fraud threat to Americans, while the UN frames those inside as trafficking victims. Both can be true. The policy tension is between treating compound workers as offenders, as some states do, and as victims, as the UN and the TIP Report urge.
8. Timeline
| Date | Event | Source |
|---|---|---|
| Early 2021 | OHCHR dates its concerns to this period; Myanmar coup in February | OHCHR briefing paper |
| 28–29 Aug 2023 | OHCHR issues briefing paper and press release on scam-centre trafficking | OHCHR |
| 21 Apr 2025 | UNODC “Inflection Point” report | UNODC |
| 2025 | State Dept releases 2025 TIP Report; Cambodia in Tier 3 | State Dept |
| 14 Oct 2025 | U.S. and U.K. sanction Prince Group; DOJ indicts Chen Zhi; FinCEN acts on Huione | Treasury |
| 15 Oct 2025 | Cambodia’s Interior Ministry responds | AP |
| 6 Jan 2026 | Chen arrested in Cambodia, later extradited to China | CamboJA |
| 26 Feb 2026 | Hun Manet says government did not know Chen was a “kingpin” | AGB |
| 23 Jun 2026 | Treasury adds 35 Prince Group-linked targets | Treasury |
9. Frequently asked questions
Are scam-compound workers criminals or victims?
The UN human rights office says those coerced are “victims,” not criminals. The TIP Report makes a similar argument under the heading of forced criminality. In practice, several governments still treat them as immigration or criminal offenders, according to OHCHR.
Has Chen Zhi been convicted?
We found no report of a conviction. The U.S. indictment is an allegation, and Cambodia’s prime minister says Chen was extradited to China rather than the United States. Prince Group denies the allegations.
Is this only a Cambodia problem?
No. OHCHR names Myanmar, Lao PDR, the Philippines and Thailand, and UNODC reports spread to other regions.
10. Key sources and related coverage
Key sources and further reading
- OHCHR press release, 29 Aug 2023
- OHCHR briefing paper (PDF)
- UNODC: Cyberfraud in the Mekong reaches inflection point
- U.S. State Department: 2025 Trafficking in Persons Report
- U.S. Treasury: U.S. and U.K. action against Prince Group and Huione, 14 Oct 2025
- U.S. Treasury: further Prince Group sanctions, 23 Jun 2026
- AP: Cambodia urges fair process as U.S., U.K. pursue Prince Group
- CNA: What we know about Prince Group and Chen Zhi
- CamboJA: Hun Manet says he did not know Chen Zhi was a “kingpin”
- AGB: Cambodia PM says government unaware of Chen Zhi’s alleged scam links
- The Diplomat: More Than a Ranking (2024)
Related on Peter’s World
- Investigations hub
- Xinjiang Forced Labor: What Is Documented, Alleged and Disputed
- State Department Human Rights Report: How It Works and What Changed
- Fawzia Amin Sido: A Yazidi Woman’s Decade-Long Ordeal from ISIS Enslavement to Rescue and Advocacy, a survivor account of another form of enslavement
- US Sanctions 10 Iran Arms Buyers and Russia’s Yakovlev Bureau, on how OFAC designations work in practice
11. Note on method and status
This page is an independent explainer compiled from public sources; allegations are not findings of guilt. Last updated: Sep 30, 2026.
Method: claims are attributed to the named source. Single-source items are flagged: the 300,000 and $60 billion figures come from a U.S. Institute of Peace report reported by The Diplomat, which we did not open. The DOJ press release page blocked our automated fetch, so DOJ charges are cited through Treasury, AP and CNA. Corrections are welcome through our Contact page.