Cambodia’s National Assembly has unanimously passed a draft law introducing some of the world’s harshest penalties for online scam operations, many of which rely heavily on cryptocurrency. All 112 lawmakers present voted in favor of the legislation on Monday. The bill now moves to the Senate for review before requiring final approval from King Norodom Sihamoni. The move comes as Cambodia races to meet a self-imposed April deadline to eliminate all scam centers within its borders.
The legislation establishes a tiered sentencing structure based on the scale and nature of offenses. Those running large-scale fraud networks face prison terms of 15 to 30 years, rising to life imprisonment if their operations result in deaths. Ringleaders could receive between five and ten years, or up to 20 years alongside steep fines in cases involving violence, trafficking, or forced labor. Lower-level participants face two to five years in prison and fines of up to $125,000.
The law arrives amid mounting international pressure following Interpol‘s designation of scam compound networks as a global transnational threat. Pig-butchering investment fraud and romance scams have become a significant problem across Southeast Asia, with networks operating from compounds and relying on coerced labor. These operations have collectively extracted tens of billions of dollars annually from victims worldwide, with crypto facilitating rapid cross-border transfers and layering through over-the-counter networks.
Huione Group, a Cambodia-based conglomerate whose former chairman was arrested by Chinese authorities this week, allegedly processed over $4 billion in illicit crypto proceeds. The U.S. Treasury has designated the group a primary money laundering concern. Separately, Taiwanese prosecutors indicted 62 individuals over alleged ties to networks linked to Chen Zhi, who was arrested in Cambodia and extradited to China on accusations of orchestrating large-scale pig-butchering scams and laundering hundreds of millions through shell companies, underground remittances, and crypto-linked channels.
U.S. authorities have pursued forfeiture of more than 127,000 BTC tied to such operations, described as one of the largest seizures in Department of Justice history. A U.S. cross-agency strike force also reported freezing or seizing roughly $580 million in crypto linked to scam operations across Southeast Asia. Sanctions have been applied to entities across Cambodia and Myanmar connected to networks that cost victims more than $10 billion in 2024 alone.
Despite the legislative action, cybercrime consultant David Sehyeon Baek cautioned that the crackdown is more likely to displace the industry than destroy it. He noted that scam networks are highly portable, capable of moving personnel, infrastructure, laundering channels, and management teams across borders rapidly. Baek identified the real test as whether Cambodia pursues official complicity, politically connected compound owners, and the broader business infrastructure enabling the operations, calling for anti-corruption enforcement, asset tracing, tighter casino oversight, and cross-border intelligence sharing.
Baek also described crypto as now central to many higher-value scam models, though he characterized the broader ecosystem as hybrid, with banks, shell firms, and informal networks continuing to play significant roles alongside digital assets. Meanwhile, Amnesty International warned in January that mass escapes from Cambodian scam compounds have triggered a humanitarian crisis. Thousands of trafficking victims have been left stranded without passports, medical care, or support after fleeing abusive conditions, adding a human dimension to the ongoing enforcement challenge.
Originally reported by Decrypt.
