The Cambodian government says it wants to stop the rampant surge in crypto romance scams and shut down the compounds in the country that perpetrate such online fraud.
But evidence has emerged implicating the prime minister’s own family in crypto-connected scams.
That’s according to a DL News investigation and new report from blockchain analytics firm Elliptic, which found that a Cambodian online marketplace called Huione Guarantee has become widely used by scam operators in Southeast Asia.
Crypto wallets used by Huione Guarantee and merchants who do business on the site have received more than $11 billion since 2021, according to Elliptic’s analysis.
A DL News review of Huione Guarantee’s site found merchants openly offering money laundering services, and others selling software and web development tools to build schemes to swindle victims, dubbed “pig butchering” scams.
Prime minister’s cousin
Hun To, the cousin of Prime Minister Hun Manet, is a director in one of the units comprising a Cambodian conglomerate called Huione Group that has been linked to crypto fraud, Elliptic said.
While not all $11 billion in transactions cited by Elliptic can be traced to illegal transactions, the researchers said the evidence provides “very strong indications” that the majority of payments stem from illicit activity.
“Many of the merchants explicitly offer money laundering services,” Elliptic said, “including accepting payments from victims around the world, transferring it across borders and converting it to other assets including cash, stablecoins, and to Chinese payment apps.”
Huione’s media representatives did not respond to a request for comment. Hun To could not be reached for comment.
Industrial-scale proportions
The development is the latest sign that crypto-fueled fraud has reached industrial-scale proportions in Southeast Asia.
In January, the United Nations Office on Drugs and Crime said more than $17 billion in USDT, the stablecoin issued by Tether, was connected to underground crypto exchanges, illegal trades, and criminal activities.
DL News has reported how crime groups are operating facilities in special economic zones in Cambodia and Myanmar where thousands of people are coerced into running crypto fraud on the internet.
The emergence of online bazaars brazenly offering illicit services takes crypto fraud to a new level.
Huione Guarantee acts as a kind of clearing house for thousands of instant messaging app channels in Chinese, with each operated by a different merchant.
The company maintains the platform and acts as a guarantor or escrow provider for all transactions, ostensibly to prevent fraud, Elliptic said in its report.
The site says payments are primarily accepted in USDT, but payment apps and bank transfers may also be used.
Money laundering motorcades
Browsing through its groups, DL News found one ad on a Telegram channel searching for fleets of trucks.
Typically, this is code for money laundering “motorcades’' that seek to obscure the origin of illicit transactions by washing them through different accounts. The entity behind the ad said it is looking to deposit 1,500 to 50,000 USDT a day.
“No registration required, cryptocurrency exchange is completed in 1 minute, no fund custody is required, security, privacy and reliability support U-to-anonymous currency exchange, cross-chain exchange,” said the ad.
In January, Slowmist, a blockchain analytics firm, also identified Huione as an intermediary to collect ransom payments from the families of people forced to labour in scam compounds by the Northern Myanmar Alliance Army.
Luxury services
Huione started in 2014 as a company providing luxury services to wealthy Chinese and Cambodians, including helicopter leasing and five star hotel reservations, according to its website. It wasn’t long before it started a payments app enterprise called Huione Pay.
The company and its various subsidiaries have become a fixture in Cambodia’s financial industry. From the outside, the Huione Pay headquarters in Phnom Penh looks like just another bank in the financial district.
Two giant black-and-gold panda statues flank the entrance. And as with most official buildings in the city, there are signs on the walls saying you’re not allowed to bring guns inside.
Scam compounds
Hun To, the Cambodian prime minister’s cousin, is a director for one of the payments units connected to Huione Guarantee, according to business filings reviewed by DL News.
He is also Chairman of the Board of Directors at another connected company, Huione Life Insurance.
Hun To’s late father is the brother of Cambodia’s longtime former dictator Hun Sen, who stepped down in 2023 in favour of his son, Hun Manet.
Callan Quinn, DL News’ Hong Kong correspondent, covers the crypto industry in Asia. Have a tip? Contact the author at callan@dlnews.com.