New research reveals the hidden infrastructure behind Southeast Asia's online scam compounds
New research by Dr Xu Peng (Manchester / SOAS CIVAD) demonstrates that online scam compounds in the China–Myanmar borderlands are far more than cybercrime operations, revealing that they rely on physical infrastructure, fragmented governance, and cross-border networks to sustain one of the world's fastest-growing illicit industries.
Estimated by the United Nations Office on Drugs and Crime (UNODC) to have generated between US$18 billion and US$37 billion in 2023, scam compounds have become a major driver of organised crime across mainland Southeast Asia. Rather than operating solely online, the research shows these enterprises are deeply embedded in the political and economic realities of contested border regions.
Focusing on the northern Myanmar–China corridor, the paper explores how armed groups, state officials, brokers and other intermediaries shape the governance of scam compounds. While periodic crackdowns attract headlines, the research suggests they often leave the underlying protection networks and business structures intact.
The study also highlights the critical role of physical infrastructure. Reliable electricity, telecommunications, transport routes and supply chains are essential for supporting sophisticated fraud operations, alongside technologies such as AI-assisted translation, messaging platforms and cryptocurrency. Together, these systems enable scam compounds to recruit workers, move equipment and conduct fraud on an industrial scale.
Beyond governance and infrastructure, the research examines the moral narratives used to legitimise recruitment and exploitation, while acknowledging the complex economic relationships these operations create within local communities.
The findings challenge conventional views of online fraud, concluding that scam compounds are not isolated criminal enterprises but embedded within wider systems of governance, infrastructure and regional development. The research provides a new perspective on the political and economic conditions that enable illicit digital economies to thrive across contested borderlands.
Read the full research paper Scam Logistics: Building and Governing the Digital Illicit Economy in the China–Myanmar Borderlands and find related publications on how conflict-affected borderlands are shaped by global development and wealth accumulation on the Centrality of the margins: Borderlands, illicit economies and uneven development project page.