Reported by Owen Walker

(Excerpt shared below. To read full report, go to: https://www.ft.com/content/a81bc993-97fc-45d2-bd55-9dd32b5957d1)

Singapore police swept across the city-state, seizing hundreds of millions of dollars in financial assets, a yacht and a fleet of luxury cars, all allegedly linked to Cambodia’s murky and criminal world of online scams. 

Last month’s dramatic seizure of assets linked to Cambodia’s Prince Group, identified by US and UK authorities as a “transnational criminal empire”, has reignited questions over the financial centre’s soft underbelly and role as a conduit of illicit money.

Singapore’s proximity to south-east Asian scam centres has made it a prime location for criminals to launder their ill-gotten gains.

“The problem Singapore faces is that as a trading nation, it is built around inflows and outflows — its success makes it vulnerable to money laundering,” said Rory Doyle, head of financial crime policy at Fenergo, a compliance company.

“Singapore’s geographical location and reputation within Asia make it a jurisdiction of choice for regional criminals,” said Chengyi Ong, head of Asia-Pacific policy at Chainalysis, which tracks digital money flows. 

South-east Asia has in recent years emerged as the global centre for scam networks. The Prince Group case burst open last month when US and UK authorities put sanctions on 146 individualsand entities connected to the group, including its alleged ringleader, Chen Zhi, a 37-year-old Chinese-born Cambodian national.

The US government seized $15bn worth of bitcoin connected to Prince Group and charged Chen with conspiring to commit wire fraud and money laundering. Chen’s location is unknown.

Authorities alleged that Chen and his accomplices operated a vast, international criminal empire, forcing trafficked workers in Cambodian scam compounds to steal billions of dollars from victims around the world, then laundered the proceeds through entities across Asia and offshore financial centres.  

Singaporeans have been particularly vulnerableto the online frauds — with more than S$1bn (US$768mn) lost last year — but the financial hub is also an attractive destination for the criminals.

“Criminals don’t want to lose their money and they see Singapore as the safe haven in south-east Asia,” said Doyle.