Regulation
Company Linked to Cambodia’s Ruling Family Runs $11 Billion Crypto Scam – DL News
- Huione Guarantee operates an online bazaar for crypto scam software and money laundering services, Elliptic says.
- Hun To, nephew of the Cambodian prime minister, is a director of one of Huione’s units, according to company records.
- Organized crime groups are coercing thousands of people into perpetrating cryptocurrency scams, authorities say.
The Cambodian government says it wants to put an end to a surge in cryptocurrency scams and shut down websites in the country that commit such online fraud.
But evidence has emerged implicating the prime minister’s own family in cryptocurrency-related scams.
It is according to a DL News investigation and new report from blockchain analytics firm Elliptic, which discovered 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 doing business on the site have received more than $11 billion since 2021, according to Elliptic’s analysis.
A DL News A review of Huione Guarantee’s website revealed that merchants were openly offering money laundering services and others were selling software and web development tools to develop schemes to defraud victims, dubbed “pig slaughter” scams.
The Prime Minister’s cousin
Hun To, the cousin of Prime Minister Hun Manet, is a director of one of the units comprising a Cambodian conglomerate called Huione Group that has been linked to crypto fraud, Elliptic said.
While not all of the $11 billion in transactions cited by Elliptic can be attributed to illegal transactions, the researchers said the evidence provides “very strong indications” that the majority of payments originated from illicit activity.
“Many merchants explicitly offer money laundering services,” Elliptic said, “including accepting payments from victims around the world, transferring them across borders, and converting them into other assets, including cash, stablecoins, and Chinese payment apps.”
Join the community to receive our latest stories and updates
Huione representatives in the media 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 cryptocurrency-fueled fraud has reached industrial-scale proportions in Southeast Asia.
In January, the United Nations Office on Drugs and Crime said that more than $17 billion in USDTthe stablecoin issued by Tether, was connected to underground crypto exchanges, illegal transactions and criminal activities.
DL News reported how criminal groups are operating facilities in special economic zones in Cambodia and Myanmar where thousands of people are forced to commit crypto fraud on the Internet.
The emergence of online bazaars openly offering illicit services takes crypto fraud to a new level.
Huione Guarantee acts as a kind of clearinghouse for thousands of Chinese instant messaging app channels, each operated by a different merchant.
The company operates the platform and acts as a guarantor or escrow provider for all transactions, ostensibly to prevent fraud, Elliptic said in its report.
The site states that payments are primarily accepted in USDT, but payment apps and bank transfers can also be used.
Money laundering parades
While browsing through his groups, DL News I found an ad on a Telegram channel looking for truck fleets.
Generally, this is a code for money laundering. “car parades” who seek to conceal the origin of illicit transactions by laundering them through different accounts. The entity behind the advertisement said it was seeking to deposit between 1,500 and 50,000 USDT per day.
“No registration required, cryptocurrency exchange is completed in 1 minute, no fund custody is required, security, privacy and reliability support U-anonymous currency exchange, cross-chain exchange,” the announcement said.
In January, Slowmist, a blockchain analytics company, also identified Huione serves as an intermediary to collect ransoms from the families of people forced to work in fraudulent camps by Myanmar’s Northern Alliance Army.
Luxury services
Huione started in 2014 as a company providing luxury services to wealthy Chinese and Cambodians, including helicopter charters and five-star hotel bookings, according to its website. It wasn’t long before it launched a payment app business called Huione Pay.
The company and its various subsidiaries have become a fixture in Cambodia’s financial sector. From the outside, Huione Pay’s Phnom Penh headquarters looks like just another bank in the financial district.
Two giant black and gold panda statues flank the entrance. And like most official buildings in the city, signs on the walls warn that it is forbidden to bring firearms inside.
Fraudulent compounds
Hun To, the cousin of the Cambodian prime minister, is a director of one of the payment units linked to Huione Guarantee, according to business documents reviewed by DL News.
He is also the chairman of the board of another related company, Huione Life Insurance.
Hun To’s late father is the brother of longtime Cambodian dictator Hun Sen, who stepped down in 2023 in favor of his son, Hun Manet.
Callan Quinn, DL News Correspondent in Hong Kong, he covers the crypto industry in Asia. Got a tip? Contact the author at callan@dlnews.com.