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The Role of Casinos, Cryptocurrency, and Underground Banking in Fueling Crime Across East and Southeast Asia

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Bangkok , January 15, 2024 – A recent report sheds light on the pivotal role played by casinos, junkets, and cryptocurrency in facilitating underground banking and money laundering networks in East and Southeast Asia, contributing to the rise of transnational organized crime in the region.

Entitled ‘Unveiling the Nexus: Casinos, Money Laundering, and Transnational Organized Crime in East and Southeast Asia’, the study underscores the intertwining operations of illicit online gambling platforms, e-junkets, and crypto exchanges, which have burgeoned alongside the surge in cross-border criminal activities.

Jeremy Douglas, UNODC Regional Representative for Southeast Asia and the Pacific, emphasized the transformative impact of underregulated online gambling and crypto platforms on the illicit economy. These developments have catalyzed a technological revolution in underground banking, enabling faster, anonymized transactions and opening new avenues for organized crime syndicates.

The report illustrates numerous instances where major criminal organizations have exploited online casinos to launder vast sums of fiat and cryptocurrencies, blurring the lines between legitimate and illicit financial flows. Furthermore, it highlights the diversification of illegal casino operations into cyberfraud and cryptocurrency laundering, often with the complicity of armed groups in border regions like Myanmar.

Despite efforts to combat these activities in countries such as Cambodia and the Philippines, criminal syndicates continue to adapt, relocating their operations to remote areas of the Mekong and beyond, where enforcement is lax.

UNODC analysis reveals a significant proliferation of land-based and online casinos across Southeast Asia, with the formal online gambling market projected to exceed US $205 billion by 2030. Policy responses from regional governments aim to stem the tide of illegal capital outflows, corruption, and money laundering associated with these trends.

The technical policy brief, informed by extensive research and consultation with authorities, offers recommendations to strengthen legislative frameworks, enhance enforcement measures, and foster regional cooperation in combating organized crime.

As Benedikt Hofmann, UNODC Deputy Regional Representative, warned, failure to address this criminal landscape could have far-reaching consequences. The report serves as a critical resource for policymakers and stakeholders to confront the evolving challenges posed by transnational organized crime in the region.