The United Nations Office on Drugs and Crime (UNODC) has warned of a rapid rise in cybercrime and illegal online gambling in Southeast Asia.
According to UNODC, fraudulent activities targeting residents of East and Southeast Asia led to financial losses ranging from $18 to $37 billion in 2023. Most of these crimes are linked to organized crime groups in the region. The report emphasizes that criminal networks actively utilize online platforms for illegal operations, particularly in the Mekong region, which has become a “key testing ground” for such activities.
UNODC’s findings are based on criminal indictments, intelligence analysis, court documents, and consultations with law enforcement agencies at both regional and international levels.
Additionally, the agency compared and analyzed information from thousands of underground markets and Telegram channels associated with Asian organized crime groups.
Hubs of illicit activity
The report notes that the rapid development of physical, technological, and digital infrastructure has created favorable conditions for organized crime to thrive.
Organized crime groups are increasingly using casinos, hotels, special economic zones (SEZs), and other real estate as centers for the expanding illegal economy, according to a statement from the agency.
These locations often serve as bases for transnational criminal organizations engaged in various forms of illegal activity, including drug production, human trafficking for forced labor and prostitution, and money laundering.
“Underregulated casinos, junkets, and illegal online gambling platforms are critical infrastructure for transnational organized crime groups operating in and beyond the region,” the report states.
Enforcement Challenges
According to UNODC, authorities in East and Southeast Asia are facing significant challenges in combating illegal online gambling. The report indicates that restraining the spread of this industry has proven extremely difficult, leading to the formation of a multi-billion-dollar shadow economy operating in “grey,” “black,” or “pre-regulated” markets.
Criminal groups have established complex mechanisms for processing and laundering large volumes of illicit funds, resulting in increased demand for money laundering services.
The report details how illegal online gambling platforms and unauthorized virtual asset service providers have been exploited by major organized crime groups to launder billions of dollars in criminal proceeds.
“Organized crime groups are converging and exploiting vulnerabilities, and the evolving situation is rapidly outpacing governments’ capacity to contain it,” said Masood Karimipour, UNODC regional representative for Southeast Asia and the Pacific.
Increase in Crimes Committed Using AI
The report also highlights a sharp rise in crimes involving artificial intelligence, particularly related to deepfakes.
In the first half of 2024, the number of mentions of content associated with deepfakes and criminal groups in Southeast Asia increased by more than 600%.
“The integration of generative artificial intelligence by transnational criminal groups involved in cyber-enabled fraud is a complex and alarming trend,” said UNODC regional analyst John Wojcik.
He noted that artificial intelligence has expanded the reach and effectiveness of cyber fraud, lowering the barriers for less technically skilled criminal networks to engage in high-level cybercrime.
UNODC has urged governments to take swift action to combat the growing threat of cyber fraud and illegal online gambling in the region.
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