Illegal Online Operations Migrating From Laos To Myanmar: Report

August 25, 2023
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Government pressure on illegal online gambling operations in Laos’ Golden Triangle Special Economic Zone has resulted in migration of operations to Myanmar border towns near Thailand, according to the International Crisis Group.

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Government pressure on illegal online gambling operations in Laos’ Golden Triangle Special Economic Zone (SEZ) has resulted in the migration of operations to Myanmar border towns near Thailand, according to the International Crisis Group (ICG).

Lao and Chinese government pressure on online gambling networks, scam operations and worker enslavement, as well as other organised criminal activity, has pushed operators to the Myanmar “boomtown” of Tachileik in Shan State, some 20km to the northwest of Thailand’s northern border, according to the August 18 report.

Other operations have moved from the Golden Triangle SEZ to business centres in the Myawaddy area of Myanmar’s Karen State, sitting on Thailand’s western border some 400km to the southwest.

“This action followed pressure on SEZ management from the Lao government, and pressure on both from Beijing, as the plight of trafficked workers from numerous countries has become a prominent diplomatic issue in the region,” the August 18 report said.

The Shwe Kokko and Lay Kay Kaw towns in the surrounds of Myawaddy have become online gambling and scam operation hubs over several years on the back of investment by ethnic Chinese investors with criminal backgrounds and the support of local warlords.

In June, the Thai authorities across the border cut the electricity supply to the area in response to a request from Myanmar’s military government, irritating the ethnic Karen militia that controls the area.

According to the ICG report, however, the town of Tachileik near the Laos-Thailand-Myanmar border point is free of instability from widespread civil warfare in Myanmar because of alliances between the ruling junta and the local Border Guard Force composed of ethnic militia members.

Tachileik hosts around 12 land-based casinos out of at least 60 unregulated casino operations in Shan State, the report said.

“While swathes of Myanmar are in the midst of violent conflict, and economic conditions for most people are extremely difficult, Tachileik is a boomtown, with casinos, nightclubs and video karaoke (“KTV”) establishments doing a roaring business,” the report said.

The ICG report says the area combining Myanmar’s Shan State and Laos’ Bokeo Province, which includes the Golden Triangle SEZ, has “become a contiguous zone of vibrant criminality, much of which is beyond” either nation to control.

The area remains a major production and distribution point for methamphetamine supplies to the rest of Southeast Asia, Japan and Australia, it says.

“The sheer size of the area’s illicit economies, which dwarf the legal economies of Shan State and northern Laos, means that they have an enormous impact — entrenching corruption, weakening governance institutions and damaging social capital,” it says.

The wider criminal influence of the region is set to increase after the opening of the Golden Triangle SEZ-funded Bokeo International Airport, just minutes from the SEZ border, as well as an SEZ-funded port on the Mekong river just kilometres upriver from the SEZ’s Kings Romans Casino.

The US Treasury 2018 blacklisted the casino and its owner, Zhao Wei, and a number of associates for “engaging in drug trafficking, human trafficking, money laundering, bribery, and wildlife trafficking”.

The opening of the airport and port is triggering anger among local Lao officials and communities, who say Vientiane has handed over yet more land and de facto sovereign authority to Chinese investors with little to no economic benefit and increasing risk of organised crime infiltration, Radio Free Asia reported on August 18.

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