DKBA troops take part in a ceremony in 2019 to mark the 25th anniversary of the group’s founding. (Thuya Zaw | Frontier)

South for the winter: Myanmar’s cyber scam industry migrates

A supposed crackdown on cyber scam operations in Myawaddy Township has only masked their relocation, with the Kayin BGF and DKBA helping Chinese criminal syndicates set up shop farther south in Three Pagodas Pass.

By NAW BETTY HAN | FRONTIER

U Kyaw Min runs a small restaurant in the centre of Payathonesu town, serving curry and rice to internal migrants from all over Myanmar, members of various ethnic armed groups and the occasional Thai visitor.

“There are a lot of people coming in and out, because of border trade, or migrant workers who come to work in the factories here,” he told Frontier. Like all other named sources in this article, he asked to be identified by a pseudonym to speak freely.

In southern Kayin State’s Kyainseikgyi Township, near the border with Mon State, Payathonesu is named after the Three Pagodas Pass through the Tenasserim Hills that connects it to Thailand’s Sangkhla Buri town.

Payathonesu has long been home to four major ethnic armed groups: the Karen National Union, which is fighting to overthrow the military regime that seized power in a 2021 coup; the military-aligned Kayin State Border Guard Force; and the New Mon State Party and Democratic Karen Benevolent Army, both of which are largely observing a ceasefire with the military.

For a while, the only foreign guests were Thai, which wasn’t a problem for Kyaw Min, who worked as a supervisor in a garment factory in Thailand for 10 years. But a new wave of foreigners began arriving around three months ago, he said.

“I noticed a lot of Chinese people started coming to eat at my restaurant. I think it started around May,” he said. “Now there’s even more.”

Ever the enterprising businessman, Kyaw Min has embraced the change, learning Chinese and hiring two Chinese-speaking staff. But the new customers didn’t move to Payathonesu for Kyaw Min’s world famous curry. 

They appear to be part of a mass migration of Chinese criminal syndicates relocating from Kayin’s Myawaddy Township with the help of the Kayin BGF and the DKBA. 

The dramatic exodus is linked to events much farther north, on the Chinese border.

In late October, the Three Brotherhood Alliance of ethnic armed groups launched a stunning offensive in northern Shan State, crushing another military-aligned militia – the Kokang BGF. It’s widely believed the offensive was greenlit by China, which was angered by the Kokang BGF’s involvement in the billion-dollar cyber scam industry that often relied on Chinese forced labour to scam Chinese nationals online.

The Kayin BGF has also long hosted similar operations in its Shwe Kokko headquarters in Myawaddy Township. But spooked by the Kokang BGF’s defeat, the Kayin BGF announced in May it would expel “foreigners” from Shwe Kokko by the end of October, seemingly a reference to the Chinese syndicates. 

But the crackdown appears cosmetic, merely protecting the Kayin BGF by moving operations away from its headquarters, while the Chinese criminals shift their focus to English-speaking victims in a bid to evade Beijing’s wrath.

Soldiers of the Kayin State Border Guard Force parade in a ceremony at Shwe Kokko to mark the group’s ninth anniversary in 2019. (Frontier)

Migration patterns

A Kayin BGF member, who commented on the condition of anonymity, confirmed to Frontier the group has been relocating Chinese “businesspeople” from Myawaddy to Payathonesu. He was part of a unit assigned to provide security on this route twice – once in May and once in June.

“When travelling from Myawaddy to Payathonesu, we had to avoid the conflict areas, and the BGF cars followed their cars on both sides as security,” he said. “We passed through DKBA and military checkpoints along the way, but I think they had been informed in advance, because they let us through without any inspection.”

The officer said he heard that the BGF and DKBA receive 100,000 baht (nearly US$3,000) for each Chinese business owner who is successfully relocated, and 30,000 baht per person for the workers. But he didn’t see any of that money.

“If we’re asked [by the leadership] to provide security, we have to provide security,” he said, adding that some BGF troops have also been assigned to work as security at the compounds rented by the Chinese business owners upon arrival in Payathonesu.

A DKBA member said the BGF is largely responsible for transporting Chinese people from Myawaddy to Payathonesu, and the DKBA is largely responsible for helping them rent land and houses when they arrive.

“In May, one group of 200 people, one group of 58 people and one group of 158 people moved from BGF territory and we helped them find houses and land. But these are just the groups I know about firsthand. There could be others. My colleagues told me around 2,000 Chinese people came to Payathonesu between May and June,” he said.

He said they haven’t come only from Myawaddy, but also from the Kayin capital Hpa-an and from Mawlamyine and Mudon townships in Mon State.

“I think there has been some kind of agreement between our leader and the BGF leaders,” he added.

Colonel Saw A Wan, a DKBA senior commander, declined to comment on the DKBA’s involvement in relocating Chinese nationals or its cooperation with the BGF, and downplayed the significance of the recent developments.

“Because it’s a border town, there will be gambling businesses, border trade related businesses and people migrating. There were businesses like this before,” he told Frontier.

But Ma Lae Lae, who has been working in online scamming in Myawaddy since 2021, confirmed that the businesses relocating to Payathonesu are cyber scam operations. She previously spoke to Frontier in October last year, when her company moved from a self-contained casino complex to an outside hotel in Myawaddy town.

Since then, she’s been promoted from scamming people online to working as the personal assistant of her Chinese boss, and joined the mass exodus to Payathonesu in late June. She travelled in a car with 13 Chinese nationals from her company and said there were about 12 other cars in the convoy, as well as BGF vehicles providing security.

“Since the first week of June, we’ve been moving office equipment and people,” she said, adding that Myanmar staff are given the option of finding their own way, or paying to travel with the Chinese supervisors and security escort. As the personal assistant to the boss, Lae Lae’s travel fee was covered by the company.

“Moving with the company is safer because there are many areas with fighting along the way.”

Since arriving, she’s had her hands full rebuilding the scamming operation from scratch.

“I have to do everything for the land lease and building rentals in order to create a new office. People from the armed groups are also helping with those issues, but since I’m Burmese, I can do it myself. Some of the other businesses that moved in only have Chinese staff, so they need more help from the armed groups,” she explained, confirming it’s the BGF and DKBA providing assistance.

The changing face of Payathonesu

Ko Win Myint, who has worked as a cleaner in a 50-room hotel for 14 years, said the influx of Chinese has been like a gold rush for the hospitality industry.

“From the first week of May until the second week of June, our hotel was completely booked, which has never happened before,” he said, adding that all the customers were Chinese, who were usually brought to the hotel by BGF and DKBA troops, identifiable by markers on their cars and badges on their uniforms.

He said the hotel is no longer full, but new guests continue arriving, while the first wave has relocated to rental houses, like the one owned by Ma Khin Mar.

“Our family has a 50-by-70-foot plot of land near the Myo Chit Gate [controlled by the BGF] where we do a little bit of agriculture and also have a small house,” she told Frontier. “A member of the DKBA told me in June that he knew a Chinese businessman who wanted to rent the plot and we said we would do it for the right price.”

They agreed to a five-year contract for a rental fee of 15,000 baht per month, to be paid in a lump sum at the start of each year. 

“The DKBA member rented the land in his name. They [the Chinese people] said that because they are foreigners they are worried that they may have difficulty in handling some paperwork,” Khin Mar said.

Like other towns and cities that have become scam hubs, the face of Three Pagodas Pass is changing, Khin Mar said.

“If you drive around on a motorcycle you’ll see many Chinese people, and business signs and job advertisements written in Chinese,” she said.

Win Myint said the Chinese nationals at the hotel brought a lot of office equipment with them, like computers, desks and chairs. “When we asked them what kind of work they do, they said they came to invest and work in Payathonesu, but they didn’t say anything specific.”

Khin Mar said the Chinese nationals told her they will operate an online casino at her home, and plan to construct temporary buildings in the fashion of container boxes.

“I only rent the land; I won’t be involved in their business,” she said, adding she doesn’t plan to visit the property at all anymore.

That’s perhaps a wise decision, given the reports of torture and murder that have plagued the industry and the impunity that reigns in the border enclaves.

“I often see the Chinese and the armed troops walking together as one group,” said Kyaw Min. “I even noticed that sometimes these Chinese people carry guns – small pistols stuck in their waists.”

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