This story contains disturbing images and audio.

Viewer discretion is advised.

Enter
Special Report

Billion-dollar scam 

A sophisticated criminal network is using modern day slaves to con thousands of Americans out of their life savings

By Teele Rebane, Ivan Watson, Tom Booth, Carlotta Dotto, Marco Chacon and Mark Oliver, CNN

7:44 Thursday, Nov 18 Good morning, have a happy day Jessica 1 message WhatsApp NOW + online Jessica Good morning, have a happy day 07:44 Haven't gotten up yet? 08:07 Just got up 09:00 Just made money 19:18 100K 19:18 You did! 19:18 How can I make at least $5k? 19:38 Wait for us to become good friends 19:40 Lol. 19:40 Do you believe me? 19:40 I’m very easy to believe. That’s my weakness 19:41

CY’s phone lit up with a Whatsapp message. It was Jessica, a beautiful Chinese-American woman who introduced herself as an old colleague. CY didn’t remember meeting her but she seemed kind and he responded anyway.

They began chatting in October 2021 and over the next few weeks built a close friendship. Jessica shared photos of her luxurious lifestyle in New York and CY talked about the pain of caring for his dying father in the San Francisco Bay Area where he lives. “She was always there to provide comfort, compassion,” he told CNN.

A few weeks into their friendship, Jessica taught CY how to invest in cryptocurrency to help pay for his father’s care. The initial profits were astonishing, and CY believed he was making hundreds of thousands of dollars. So, he kept investing until one day he got locked out of his account. More than a million dollars was gone.

“What the heck happened? What did I do?” he recalled thinking.

Panicking, he called Jessica for help. But Jessica had disappeared.

CY's scammer "Jessica" often shared photos with him, giving a glimpse of her luxurious lifestyle in New York. Source: CY

CY, 54, is one of tens of thousands of American victims of a new form of financial fraud run by Chinese crime syndicates out of war-torn Myanmar and other countries in Southeast Asia.

In three short years, according to UN and FBI investigators, transnational crime organizations have exploited developments in technology and the civil war in Myanmar to build a billion-dollar industry to scam people across the world out of their life savings.

This huge scam operation relies on an army of modern-day slaves, assembled by what the UN has called one of the largest human trafficking events in Asia in recent history.

It’s known as a “pig butchering” scam -- a type of confidence fraud in which victims are lured by scammers often impersonating young women on the internet. The scammers then spend weeks building a relationship with their victim, introducing them to cryptocurrency and encouraging them to invest on a fake platform.

Victims are shown startling returns and coaxed to keep pumping in more money — like a pig slowly fattened for the slaughter — until one day their scammer disappears along with the money.

Over the last six months CNN has spoken to fraud victims, investigators and even the scammers themselves to piece together the inner workings of the global scam industry.

“This is the professionalization of fraud services,” said FBI special agent James Barnacle, who warned that more and more Americans, and people all around the world, are falling for it.

In 2020 reported losses connected to pig butchering scams amounted to $907million, according to the FBI. By November 2023 that number had shot up to $2.9 billion for the year.

“The bad guys are getting good, and they’re getting better” -- James Barnacle, FBI, November 22, 2023.

The other victim

About 8,000 miles away from San Francisco in the mountains of eastern Myanmar, the sound of construction echoes through the hills.

This enclave is separated from Thailand by just a few meters and the shallow Moei river.

Large compounds, housing thousands of people, are being built along the Thai-Myanmar border.

They appear out of place in this otherwise untamed landscape, interrupting lush greenery that stretches as far as the eye can see.

This is the center of the billion-dollar scam industry the FBI understands from Thai intelligence is a haven for Chinese organized crime syndicates engaged in fraud and other criminal acts.

From across the river, Gate 25, where Rakesh was held, appears to be a modern apartment complex, but the 10-foot-high fence and guard tower suggest otherwise. Source: CNN

It is in one of these compounds that Indian national Rakesh, 33, worked for 11 months as a scammer stealing thousands of dollars from unsuspecting victims like CY.

From San Francisco, someone like Rakesh may look like the bad guy. But he was also the victim of a brutal scam. Lured to Thailand with promises of white-collar jobs, thousands of people from across the world are trafficked to criminal hubs in Myanmar where they are held against their will and forced to steal millions in cryptocurrency.

The UN estimates that up to 120,000 people could be held in compounds across Myanmar, with another 100,000 people held in Cambodia and elsewhere in conditions that amount to modern slavery.

In December 2022 Rakesh, who asked CNN not to use his full name to protect his family’s privacy, landed in Bangkok, Thailand, where he thought he was due to start a new job in IT.

He was educated as a chemical engineer in India but had been unemployed for over six months and was desperate to find work, even if that meant leaving his family and moving abroad.

A driver sent by the company picked him up at the airport, but instead of taking Rakesh to an office in Bangkok they drove seven hours to Mae Sot, a Thai town near the Myanmar border. Rakesh grew alarmed; he called the agent who had offered him the job but was told not to worry, he would be working in Mae Sot.

100 miles

100 km

LAOS

Thailand

Myanmar

1

2

Rakesh flew to Bangkok, where he thought he was due to start a new job in IT.

Instead of being taken to an office in Bangkok, Rakesh was driven seven hours to Mae Sot, a Thai town near the Myanmar border.

Bangkok

3

He was driven across a river to a gated compound guarded by armed soldiers. Without realizing it, Rakesh had been trafficked into Myanmar, to a compound named Gate 25.

Thailand

Mae Sot

Gate 25

Myanmar

5 miles

5 km

LAOS

Myanmar

3

He was driven across a river to a gated compound guarded by armed soldiers. Without realizing it, Rakesh had been trafficked into Myanmar, to a compound named Gate 25.

Thailand

Thailand

Mae Sot

1

2

Rakesh flew to Bangkok, where he thought he was due to start a new job in IT.

Instead of being taken to an office in Bangkok, Rakesh was driven seven hours to Mae Sot, a Thai town near the Myanmar border.

Gate 25

Myanmar

5 miles

5 km

Bangkok

CAMBODIA

vietnam

100 miles

100 km

“In this situation, I get a blank in my mind,” Rakesh said of the helplessness he felt, unable to do anything except follow the agent’s instructions.

After spending a night in a hotel in Mae Sot, a second driver picked him up. A short drive later they crossed a river and arrived at a gated compound guarded by armed soldiers, he said. Without realizing it, Rakesh had been trafficked into Myanmar, to a compound named Gate 25.

Surrounded by the Moei river like a moat, Gate 25 stands eerily quiet during the day. From across the river, it appears to be a modern apartment complex, but the 10-foot-high fence and guard tower suggest otherwise.

Upon entering the compound, Rakesh said his passport was confiscated and he was presented with a contract — he was to become a professional scammer, stealing money from people across the world. “This you need to do... otherwise I will kill you,” Rakesh recalled a Chinese man telling him.

He refused to sign the contract and was thrown into what he describes as a jail cell, where he was kept with no food or water. Three days later he’d made up his mind -- he’d do whatever it took to survive.

Scammers are given new online personas to chat up potential victims on social media. Rakesh posed as Salt Lake city investor "Klara Semonov" for 11 months. Source: CNN

His managers set him up with a fake persona and taught him how to scam. Posing as Salt Lake City investor “Klara Semonov,” Rakesh spent 16-hour days chatting with potential victims as a beautiful blonde, earning their trust and building a relationship.

“Seventy to eighty percent fall for fake love,” Rakesh told CNN.

His job was to make contact and get the victim hooked, working through the night to target Americans, Brits, Brazilians and Mexicans during their waking hours. Once they were ready to invest, they were handed up the chain to a manager or team leader who would secure the investment.

Modern slavery under our nose

Standing on a hilltop in Mae Sot overlooking Myanmar’s Myawaddy region, Mechelle Moore, founder of the NGO Global Alms that combats human trafficking and gender-based violence, points out scam compounds dotting the hillside. What used to be a quiet farming area has now been transformed by special economic zones and casino towns that light up the night sky.

Multiple countries in the Mekong region have established special economic zones with favorable economic policies to attract trade and foreign investment both at home and abroad. But they are loosely regulated and often situated in border regions with a long history of transnational crime.

"Special economic zones, particularly in the Mekong, have become magnets for organized crime syndicates, at first for casinos, trafficking and related money laundering, and recently for online fraud,” said Jeremy Douglas, Regional representative for the United Nations Office on Drugs and Crime in Southeast Asia.

“They're almost like free zones for criminals where the rule of law doesn't apply."

In the shadow of Myanmar’s civil war and the Covid pandemic, these projects branched out into scam operations. Meters away from Thailand the compounds use Thai telecommunication services, the essential infrastructure needed to run transnational crime on the cloud.

In photos taken by former scammers inside the offices that scam operations are run out of dozens of people can be seen working with multiple messaging apps open on their computer screens. Source: Rakesh

In some cases trafficking victims are forced to do hundreds of squats or pushups as punishment. Source: Rakesh

Trafficking victims say beatings and torture are common inside the scam compounds. Source: Rakesh

Trafficking victims say beatings and torture are common inside the scam compounds. Source: Rakesh

How a large scam compound emerged from nothing in rural Myawaddy, Myanmar

Satellite images from Maxar and Planet Images obtained by CNN show frenetic construction all across Myawaddy between 2020 and 2023, with new compounds emerging every year and existing ones expanding.

Judah Tana, director of the NGO Global Advance Projects, said it wasn't immediately obvious the buildings housed trafficked workers. "No one knew that hundreds of thousands of people were being brought in and trafficked and trapped inside these compounds,” he said.

“This is modern slavery. And it's right under everybody’s nose.” -- Mechelle Moore, November 17, 2023.

The compounds function much like small cities with restaurants, grocery stores and even daycare centers. Chinese managers drive around in jeeps and those who stay inside the compound live in townhouses that appear out of place in rural Myanmar. Besides the scam operations, the compounds provide real estate and cover for other crimes, Rakesh says.

“Everything is there. Prostitution, drugs, everything is there,” he says.

Videos obtained by CNN and filmed by former scammers show office spaces inside the compounds where the scam companies operate from.

Dozens of people can be seen working with multiple messaging apps open on their computer screens.

Decorating the walls are motivational slogans like “One team, one dream” and “Let your efforts [be] worthy of your ambition” in English and Chinese, according to the videos. Top performing employees are celebrated and rewarded each month, said scammers and NGOs who work with trafficking victims.

But this is no ordinary workplace. Scammers who don’t bring in enough victims are punished with hundreds of squats and pushups, beatings with electrical sticks and other punishments that Rakesh says amounted to torture.

In some cases, people are sold to other compounds, traded like pawns among the syndicates, Rakesh says.

“We are slaves,” Rakesh says. “There is nothing for us to do to help ourselves. Some people were ready to die.”

The scam

Behind the messaging apps on the computer screens were people like CY, who put their faith in a new friend online with the promise of money and an escape from the pressures of everyday life.

Jessica first introduced CY, who works in finance, to the idea of investing in cryptocurrency a few weeks into their friendship. She told him she’d made millions trading gold using cryptocurrency with the help of insider information from her uncle in Hong Kong.

Jessica taught CY how to invest first instructing him to download a trading app that he says looked legitimate, and then walking him through the investment process step by step. Source: CY
Jessica taught CY how to invest first instructing him to download a trading app that he says looked legitimate, and then walking him through the investment process step by step. Source: CY

In the following weeks every day for CY began and ended with a message from Jessica. Soon she taught him how to invest, first instructing him to install a trading app. It looked legitimate, but was in fact a clone of a real trading app. He started small by investing a few thousand dollars.

+ online Jessica Am I dreaming. 17:32 60k in less than 10mins! 17:32 The big market is coming 17:32 Is it real money? Are you sure I can cash this amount out? 17:33 😋😋 17:33 fool 17:33 My dad looks so much better today. 14:02 I still have hope for him 14:02 Of course, we can't give up 14:02 And he has his own private room! 14:08 This is great, the money we make can make him live better 14:09 My soul is yours now 14:12 I won’t hurt you, so you must listen 14:13 My father just.......... 05:21 My daddy passed away.........•_• 05:41 Are you ok? 07:37 No 07:43 Dad is gone? 07:43 Yes. At 5:15am 07:45 I am so lost now 07:45 I know i will stay with you 07:46 I am handing my life to you now. 13:30 We earn it back 13:30 You have confidence? 13:30 Of course 13:31 ok. 13:31 I am trusting you. I have nothing else I can do 13:31 What happened again 11:39 Fuck 11:39 Omgomgomg 11:40 Help!!!!!! 11:40 I can't answer your call right now, just talk 11:44 What am u going to do 11:44 I lost everything ! 11:44 I am going to die 11:55 I cannot control myself 14:10 19:38 click to play

These conversations are real, but edited for brevity and clarity.

At first the profits were startling.

Am I dreaming.

17:32

60k in less than

10mins!

17:32

The big market is

coming

17:32

Is it real money? Are you

sure I can cash this

amount out?

17:33

😋😋

17:33

fool

17:33

Jessica encouraged CY to put in more and more money, promising that it would help with his father’s care. Within a month of meeting her, CY had liquidated his family assets, taken up loans and invested it all.

My dad looks so much

better today.

14:02

I still have hope for

him

14:02

Of course, we can't

give up

14:02

And he has his own

private room!

14:08

This is great, the money

we make can make

him live better

14:09

My soul is yours now

14:12

I won’t hurt you, so you

must listen

14:13

In mid-November, CY’s father died. CY spent his final night by his bedside messaging Jessica short updates every few hours.

My father just..........

05:21

My daddy passed

away.........•_•

05:41

Are you ok?

07:37

No

07:43

Dad is gone?

07:43

Yes. At 5:15am

07:45

I am so lost now

07:45

I know i will stay

with you

07:46

A few days later, the app CY was using suddenly shut down while making a trade, taking with it all the money he had invested.

CY was frantic. But Jessica convinced him that the only way to make up for the losses would be to bet again, big. Ridden by guilt and grief, he liquidated tens of thousands more to invest.

I am handing my

life to you now.

13:30

We earn it back

13:30

You have confidence?

13:30

Of course

13:31

ok.

13:31

I am trusting you. I

have nothing else

I can do

13:31

Over the next few weeks, they kept trading until CY’s total investment amounted to more than a million dollars.

The goal was to earn $1.8 million to clear his debt, at which point they would stop trading and Jessica would help him withdraw the funds. But on December 3 CY got locked out of his account again.

What happened again

11:39

Fuck

11:39

Omgomgomg

11:40

Help!!!!!!

11:40

I can't answer your

call right now, just

talk

11:44

What am u going to do

11:44

I lost everything !

11:44

I am going to die

11:55

I cannot control myself

14:10

As CY’s world came crashing down, he kept calling and messaging, begging for help but Jessica had gone quiet.

“I still cannot believe I lost everything in 1 [month],” he wrote in one of his last messages to her. “Even if other forgive me. I cannot forgive myself. I cannot accept my conscience.”

That night CY checked himself into a psychiatric hospital where he was put on suicide watch. His motivation for speaking to CNN, he said, was to warn others of the danger.

click to play

19:38

A playground for criminals

The border regions of Southeast Asian countries like Myanmar, Laos, Thailand have long been a fertile breeding ground for organized crime. The so-called “Golden Triangle” between the three has been one of the world’s most successful drug producing regions for decades.

Cambodia saw a spate of pig butchering scam centers run by Chinese organized crime crop up in 2021 and 2022 until the government eventually started to crack down.

But it is Myanmar, which has been beset with unrest and a deepening bloody civil war since the 2021 military coup, that has proven to be a lucrative base for scam operations. Out of reach and unaccountable, there is little the international community can do to help their citizens.

Mechelle Moore, who works with trafficking victims, points out scam compounds dotting the Myanmar side of the Moei river. Source: CNN

Moore and Tana are part of a small team of NGOs who work alongside the Thai government and various embassies to secure the release of trafficking victims.

In the last 18 months, they have helped more than 500 people who have escaped the compounds.

The Thai government has launched a campaign to raise awareness among the Thai public and prevent people from falling victim to scams, but hundreds of people are still being trafficked through Asia each week to serve the demands of the scam centers, according to UNODC’s Douglas.

Thai Justice Minister Tawee Sodsong told CNN he plans to set up a task force to investigate what can be done to stop scam operations from using Thai telecommunications services. He also wants to target corrupt civil servants accused of aiding human trafficking rings, or of obstructing efforts to dismantle them.

While countries around the world are coming together to help both fraud and trafficking victims, Myanmar's military government appears to have done little to stop the lucrative trade.

"The militias offer territory and protection in return for a cut of the profits. It's symbiotic - the lines are blurred between the criminals and those they rent to," he said. CNN has reached out to the Myanmar military junta for comment but has yet to receive a reply. In recent weeks state media has announced a crackdown on illegal gambling and scam centers.

And in October a powerful alliance of militias opposed to the junta launched a new and highly effective offensive in Myanmar’s northeast, partly motivated by the desire to stamp out scam centers, capturing the town of Laukkai and returning multiple alleged gang members to China for prosecution.

Months into his confinement, Rakesh called the Indian embassy in Yangon for help. With a group of friends clamoring around the phone they told an officer at the embassy that they are being held against their will and tortured. In a phone call verified by CNN, the official told them: “You people have landed in trouble by your decision, so you have to wait.”

Rakesh pleaded with him. The fighting in Myanmar had gotten close to Gate 25 and they could hear shelling nearby. “There is one guy there who can help you, but he will charge something,” the official said finally, giving Rakesh the number of an alleged smuggler.

Rakesh is one of thousands of people lured to South East Asia with promises of a job and trafficked to Myanmar, where they're forced to work as scammers. Source: CNN

CNN reached out to the Indian embassy in Yangon and Indian foreign ministry but did not hear back.

Rakesh was eventually released when his contract finished in November 2023. He believes he was let go because he simply wasn’t good enough at scamming. With a steady flow of workers to be tricked and trafficked, it’s often easier to simply replace bad scammers than to force them to work, Rakesh believes.

After paying a 20,000 baht ($566) “transportation fee,” Rakesh crossed the Moei river back into Thailand where a driver was waiting for him. He had been put in touch with Tana by a journalist he had contacted to help him escape the compound. Now Tana and a colleague were waiting for him in a mall parking lot, tracking his GPS as he inched towards them.

After 11 months of confinement, he was left with nothing but a backpack with his personal belongings. He wasn’t paid for any of his work.

In a video of Rakesh’s rescue shared with CNN, he gets in Tana’s car and begins telling them about everything he endured in the compound, but there’s one question on his mind.

“One thing I don’t understand,” he says. “Why they are not raiding the campus?”

“Why doesn’t anyone rescue you? Because it’s the largest organized crime unit in the world,” Tana responds.

A drop in the ocean

A few days after his release from Gate 25 Rakesh sits on the edge of his bed in a dark hotel room showing photos of his friends still stuck inside.

“These bastards don't care about and don't have any feelings for other persons,” he says.

Rakesh is out, but hundreds of thousands of people remain trapped in scam compounds across Asia, and more are popping up all around the globe.

“It's terrifying to think what the scale of this is like, and then how much we can't do to help them. We can do our bit, but that's a drop in the ocean compared to what they need,” says Moore, who’s working day and night to save Rakesh’s friends and the dozens of people that reach out every day begging for help.

Watch Ivan Watson’s report

On the other side of the world in the San Francisco Bay Area, CY is still piecing his life back together two years after the scam. Ridden with debt and grieving the death of his father, he is taking it day by day and hoping to send his daughter to college in the fall.

“The bigger victims are out there as slaves working for them. They don’t want to do this, but they don’t have a choice if they want to survive.”-- CY, November 18, 2023.

CNN spoke to a victim of trafficking who is currently being held in a scam compound in Myawaddy, where he has been for over a year.  Javed says speaking to CNN could put his life in danger, so he asked to use a pseudonym to conceal his identity.

Javed, who previously worked as a mechanical engineer and studied in China, accepted what he thought was an IT job in Bangkok only to be trafficked to Myanmar. He tells CNN that new victims are arriving at the compound all the time to replace those who have been freed.

For a few months, Javed says he has been secretly warning people who reply to his texts not to fall for the scam. His managers know, he says, because he’s not making them any money.

“I don’t want to destroy someone’s life because my life, my life is almost finished,” he tells CNN.

But his rebellion against the system comes at a great personal cost. He says his bosses beat him, threaten to trade his organs, or sell him to another compound, unless he starts bringing in money again.

Though his contract is nearing its end, Javed does not know if or when he will be released. “If you can, please help us,” he pleads. “Take us from this hell.”