Myanmar’s Military Generals Directly Linked to US$14 Billion Online Scam Syndicates

Laukkai, a town located in the northern region of Myanmar’s Shan state, was seized this week by anti-Junta forces supported by China. The seizure came after a prolonged period of intense clashes with military junta soldiers.

The township of Laukkai had been a hub for numerous online scam centers operated by criminal syndicates, employing a significant workforce.

According to the leader of anti-Junta forces striving to gain authority over the area, the online scam syndicates near the Chinese border in northern Shan State generate an annual revenue of US$14 billion. These syndicates are managed by four families who receive protection from the Myanmar military junta generals.

The revelation was made by Peng Deren, the leader of the Myanmar National Democratic Alliance Army (MNDAA), in a New Year’s message to supporters and reported by The Irrawaddy, an independent news service in Myanmar.

Following weeks of heavy combat with junta troops, the anti-junta forces known as the Three Brotherhood Alliance took control of Laukkai, the biggest town in the Kokang region and the core of the scam activities.

According to reports, hundreds of junta commanders and troops have surrendered. During lulls in the battle, more than 500 Thais working at scam centers in Laukkai, also known as Laukkaing, have been rescued and deported.

According to Thai authorities, 174 of them were victims of human trafficking.

According to Peng, four “big families” perpetrated hundreds of online scams in Laukkai before it was raided by the Brotherhood Alliance, with as many as 100,000 people working for them.

Because the frauds were primarily aimed at Chinese consumers, the majority of the personnel at the centers were Chinese or spoke the language.

Under pressure from China, Myanmar police affiliated with the Three Brotherhood alliance have increased arrests and deportations in recent months. According to Chinese media, 41,000 alleged scammers were brought to China last year.

However, when the town was assaulted, the Myanmar military deployed helicopters to evacuate the leaders of the crime syndicates, according to Peng.

The MNDAA is one of the Brotherhood Alliance’s three ethnic armies. On October 27, last year, they started Operation 1027 to force junta troops out of northern Shan State. According to Peng, the junta protects the four families that manage the syndicates, referring to the Bai, Wei, and two Liu clans.

Bai Suocheng, former chairman of the Kokang Special Autonomous Zone; Wei San, chief of the Kokang Border Guard Force; Liu Guoxi, a former lawmaker from the military-backed Union Solidarity and Development Party, and Liu Zhengxiang, the richest man in Laukkai are their patriarchs.

Myanmar’s military and the four families have been involved in industrial-scale drug production and cybercrime in Kokang since 2009, turning it into a hotspot for cybercrime, according to Peng.

Along with toppling the military administration, the Brotherhood Alliance set the elimination of online scam syndicates as a priority of Operation 1027.

In reaction to Peng’s claim, pro-junta media denied that online scam syndicate leaders were evacuated from Laukkai by Myanmar military helicopters, claiming that the claim was false.

Before Peng’s allegation, reports stated that during Operation 1027, leading Kokang merchants were rescued from Kokang and taken to the capital, Nay Pyi Taw.

Lt Gen Jakkapong Janpengpen, joint operations director of the Royal Thai Army, met with Myanmar junta commander Min Aung Hlaing in Nay Pyi Taw on December 27 amid the major crackdown in Laukkai.

The discussion occurred amid fears that online scam syndicates from northern Shan State will relocate to the Myanmar-Thai border opposite Tak province.

According to The Irrawaddy, the Liu and Bai clans have casinos and buildings housing scam syndicates near Myawaddy in Karen State, where the junta-aligned Karen Border Force operates, and in Cambodia.

KK Park and Shwe Kokko, two Chinese-invested “new city projects” to the south and north of Myawaddy, are known hotspots for online gambling, cyber fraud, and human trafficking in Myanmar.

Peng stated that the junta still safeguards KK Park, which he describes as Southeast Asia’s largest cyber fraud center.

KK Park is a proposed mega-project in Karen State, Myanmar, raising serious environmental and socioeconomic concerns. Shwe Kokko is a contentious development within the park, with charges of illegal land purchase and destruction.

The project has aroused international interest due to its potential environmental consequences and lack of openness in its implementation.

Continuous discussions and disputes over the project’s ethical and environmental ramifications exist.