Myanmar militia leader sanctioned by US over cyber scam connections

The U.S. Treasury Department sanctioned a Myanmar militia group and its leader on Monday for their alleged participation in the booming cyber fraud industry. 

The designation targets the Karen National Army (KNA) and Saw Chit Thu, a longtime power broker in the Myawaddy area of Karen State along the border with Thailand. The Treasury’s Office of Foreign Assets Control also sanctioned his two sons, Htoo Eh Moo and Saw Chit Chit. 

The KNA, who until mid-2024 were known as the Karen Border Guard Force, control security in Shwe Kokko, an area home to industrial-size scamming compounds, where much of the workforce is made up of people who are lured into the industry on false premises and forced to carry out scams. 

Typically, scammers will trick people into making fraudulent investments after developing a relationship with them online. The FBI reported Americans lost more than $6.5 billion to cryptocurrency-related investment fraud last year. 

Despite recent crackdowns backed by Thailand and China, the scamming industry has continued to metastasize throughout the region and within Myanmar, including in Myawaddy.

“The KNA profits from cyber scam schemes on an industrial scale by leasing land it controls to other organized crime groups, and providing support for human trafficking, smuggling, and the sale of utilities used to provide energy to scam operations,” the Treasury alleged, adding that the group also provides security at the compounds. 

Saw Chit Thu was sanctioned in 2023 by the United Kingdom and in 2024 by the European Union over his ties to the scam compounds and his relationship to the ruling military junta, which relies on the so-called border guard forces as proxy security forces in restive areas far from central control.

The Treasury designation blocks the militia leader and his sons from doing business in the U.S. and forbids Americans or people in the U.S. from financial transactions connected to them. 

Monday’s sanctions follow a Treasury designation last week of the Cambodia-based conglomerate Huione Group as an “institution of primary money laundering concern.” The platform allegedly helped launder funds from North Korean state-backed cybercrime operations and investment scams originating in Southeast Asia. 

A recent United Nations report warned that transnational criminal groups are developing increasingly sophisticated money laundering networks to conceal scam proceeds, and appear to be expanding scamming operations to other continents, including Africa and South America.