From a White Londoner to a Malay from Farrer Park, from a septuagenarian to two teenagers accompanying their dad, and from young journalists feverishly taking notes to retirees collecting kopitiam stories, about 100 people crammed into the Blue Room at The Projector at Golden Mile Tower on Tuesday, for a conversation about “Scam Inc” between The Economist’s Sue-Lin Wong and Corrie Tan, Jom’s arts editor.
“Do you know anyone who’s been the victim of a scam?” Tan asked attendees as they were shuffling in, using the anonymised Mentimeter tool accessible through phones. Gasps. Just one of the 50 people who responded said “No”. The other 49, or 98 percent of them, had either direct or indirect contact with one.
Scam victims in Singapore lost S$1.1bn last year, a record high. The global online scam industry is now probably worth over US$500bn (S$686bn) a year, said The Economist, and “may already be as big a scourge as illegal drugs”. For sure, fraud has been around “since we figured out how to lie to each other”, Wong said. But what’s different now is that the scam industry is supercharged by the internet, social media, and cryptocurrencies.
The publication’s “Scam Inc” podcast, launched this year and hosted by Wong, was the basis for a wide-ranging conversation that took us from rural Kansas to Singapore’s anti-scam command centre, one that was part intellectual nourishment, part comedy, and part horror movie.
These were some of the main takeaways:
There are worrying parallels between the drug and scam industries, between the rise of narco states in Latin America in the 1990s and the rise of scam states in South-east Asia today.
In “Scam Inc”, we learn about how South-east Asia has become the illicit industry’s epicentre. There are the vulnerable, English-speaking Filipinos aspiring to better jobs, who provide a ready supply of low-level (unwitting) scammers; the Chinese factory bosses operating in contested border zones and other unregulated areas, relying on their accomplices in Cambodia, Myanmar, the Philippines and Thailand; and the Singaporean money mules, also aspiring to a better life in one of the world’s most expensive cities, lured to (unwittingly) launder money for the Chinese ganglords.
Wong explained how she first became acquainted with the scam industry. After she moved to Singapore in 2022 with The Economist, she’d travel around the region reporting on different stories. Everywhere, scams were mentioned. “So whether I was in Cambodia or Thailand or the Philippines or Malaysia and Indonesia, my sources were saying, ‘Oh, have you heard about these scams? You should look into them.’ Even if I were there reporting on a completely different story about local politics or business.”
When she finally began work on the podcast, two of her animating questions were: how have these criminals basically co-opted countries in South-east Asia, such as Cambodia and the Philippines, such that they’ve become scam states, the way that countries in Latin America became narco states in the 1990s? How is that affecting all of us in South-east Asia, in Singapore and the world?
“If you think about how a scam starts, it starts with internet service providers or telecoms firms providing a platform to these transnational criminals. And then the scam will move to a social media platform, a messaging app, an e-commerce site, before someone will try and buy bitcoin on a crypto exchange, or transfer money from their bank account. And it’s only at that point, once they’ve done all of this, that a victim of a scam will even realise, perhaps, that they’re being scammed.
And then law enforcement gets involved…you have to deal with every single part of this scam chain, as I’ve called it, and no government realistically has really done that, because everything is transnational. And the criminals know that and take advantage of that, and know that governments, unlike criminals, have a lot more restrictions when trying to operate outside of their own country.”
Trafficked humans are being replaced by willing scammers, including perhaps AI specialists.
Because there’s been so much media coverage about the human trafficking aspect of the scam industry, Wong said, criminal bosses are increasingly shifting towards “recruiting people who voluntarily are entering these scam compounds and who actually know what they’re doing.” (The compounds, as former scammers describe in the podcast, are like self-sufficient mini towns, providing all basic necessities.)
Given that the average wage in many parts of South-east Asia is so low, it’s easy for scammers to recruit. They’re “bringing in hundreds of thousands of dollars a month in a tiny team. So they can pay much, much better than the average wage.” Wong contends that it’s a “huge public policy question” for governments and international organisations. “Because unless you sort of tackle poverty head on, and unless you tackle corruption, this industry isn’t going away.”
Separately, Wong said that in the numerous global discussions about the impact of AI, its potential use by criminals hasn’t gotten enough attention. According to her sources inside the scam compounds, AI programmers and computer scientists are now the most valuable target. “If you are one of these kinds of people, and you get tricked into going into a scam compound, it’s incredibly difficult for you to get out because you're so valuable to the criminals.”
The loneliness epidemic is one of our contemporary conditions that makes us vulnerable to merciless, psychological exploitation.
One of the common experiences amongst Wong’s interviewees was that they genuinely believed somebody real was on the other side: whether somebody they had fallen in love with; or somebody who wanted to do business with them; or a financial advisor who truly wanted to help them get rich. “They still sort of believed the story, even if the reality was different, and they hadn’t gotten any of their money back.”
She narrated the story of the wealthy, lonely man, who suspects he’s falling for a scam, but is still happy to send US$50,000 (S$63,7300) in crypto to the “person” he’s been in touch with, “just because it feels so good that someone is texting him every day, and seems to care about him, and will wish him a good night and check what he’s eating and chit chat to him for hours a day. And, I mean, that is heartbreaking.”
These are extremely sophisticated criminals, Wong said, with “so much knowledge and professional scripts and literally textbooks on human psychology to manipulate all of us.” The loneliness epidemic, especially in the rich world, is one of the deep themes of the podcast. “The scam criminals absolutely understand this, and that’s part of their playbook, and they prey on our loneliness.”
The role of the CCP: evidence of contact is not evidence of control.
Responding to an audience question about the possible role of the Chinese Communist Party (CCP) in the scam industry, Wong said that that was one of the things that excited her editors when she pitched this. One of the most startling episodes in “Scam Inc”, in fact, examines the similarities between casino and triad bosses, in places like Hong Kong and Macau, and contemporary scam bosses.
Wong said the scam industry began in China, with Chinese criminals, many from Fujian, targeting their own. But then one of the industries hit by Xi Jinping’s anti-corruption crackdown was organised crime, including money-launderers in Macau. “So they were pushed into the Philippines and the rest of South-east Asia. And that really was when we saw Scam Inc begin to go global.” Initially scam bosses were still targeting mainland Chinese, including those who wanted to launder their money through online casinos in the Philippines. But eventually they broadened their scope, partly because it’s become difficult for mainland Chinese to transfer large sums of money abroad. The CCP “hated” these criminals, Wong said, which is why they’re persona non grata in China.
So on the one hand, the CCP has a “long and complicated relationship with Chinese organised crime”, Wong said, going back decades—including with Hong Kong triads, for instance, during the 1997 handover and the 2014 pro-democracy protests. On the other hand, Wong said, “I personally haven’t come across really hard evidence to show that that relationship has continued into Scam Inc.”
What about the numerous photographs showing Chinese crime lords in contact with Chinese ambassadors around South-east Asia (including in Singapore)? “A lot of those photos, I think, were published before we really saw Scam Inc take off during Covid. And, I don’t know if evidence of contact is the same as evidence of control. The CIA has long had contact with Afghan warlords. Can we say that Afghan warlords are doing every single thing the CIA wants? No.”
But that’s not to say the relationship won’t change, Wong said, calling it a “fascinating space”. If these scam bosses became useful to the CCP, we shouldn’t be surprised to see “a more complex relationship develop. But I don’t have evidence of that yet.”
Singaporeans apparent susceptibility to scams may be partly due to just better data, alongside a government that’s doing more than any other to combat it.
“‘Rich and naive’: why Singapore is engulfed in a ‘scamdemic’” was the title of a recent article in the Financial Times. Our relative wealth and the “high levels of trust in authority”—and thus those who pretend to represent it—could be two reasons that contribute to the high recorded scam losses here, Wong said. But the other reason is the government’s determined efforts to track the crimes. “There’s actually data in Singapore showing how many people are losing money, whereas there are many other countries where the police aren't even collecting this…they don’t even have the statistics to bring to other government departments to say, look, this is a massive problem, and we need to do something about it.”
Singapore’s holistic approach to combating the industry is ahead of most other countries, Wong said. “Singapore at least acknowledges there is this massive scam chain, and that's why it has this Anti-Scam Centre that puts a lot of these different players in the same room. And I think that’s actually what we’re seeing a lot of other countries now shift to that kind of model…I wouldn’t be surprised if in the next few years we see this model proliferate globally.”
Establishing a “code word” with your family, as Sue-Lin has done with hers, is one of several precautions we each can and must take to protect ourselves.
Wong told the audience about her first, personal experience with scams. In 2015, she was a correspondent in Shanghai, China, “operating in Mandarin, which is my second language…I was even more vulnerable then.” Someone called her phone and told her that a package of hers had been held up at customs. To retrieve it, she’d have to share her passport number and other details. “One of my colleagues, who is Shanghainese, heard me on the phone and was sort of signaling, saying, ‘Don’t! What are you doing? Stop doing that.’ And then it was really embarrassing. I had to go to the bank and tell them I almost fell for a scam.”
Every individual, no matter how impenetrable they believe their armour is, is vulnerable to being scammed. Such is the sophistication of the criminals’ psychological tools. What can we possibly do? Wong suggested a few things:
- Start calling out the industry for what it is. It’s an industry. It isn’t “a couple of teenagers in hoodies in their bedrooms.” Governments and individuals need to relate to it, and deal with it, as such.
- Just assume everything is a scam, until proven otherwise.
- Since even your voice can be cloned by AI, establish a family “code word”. So if you get a call from a supposed relative requesting money, ask them for the family code word.
- If you or those you love fall for a scam, it’s important to be supportive of each other and not “victim blame”.
- Listen to “Scam Inc” and tell your friends and family to do so. (Wong said this in a somewhat facetious, self-deprecating way. But we at Jom second it.)
The chance to do The Economist’s typical “nerdy business/finance/trade reporting” mixed with “true crime” is one reason Sue-Lin stumbled into this podcast.
Wong told us a lot about the making of “Scam Inc”. For instance, the reason she went to rural Kansas, which ended up being featured in the first episode and was also the through-line of the whole show, was because many South-east Asia contacts kept talking about a bank that had collapsed in rural America.
“My producer and I showed up in rural Kansas, which was an experience in and of itself. Neither of us are American. People were very confused by who I was and what I was trying to do. There were a lot of Trump supporters who really don’t like journalists in this tiny town, but we had decided to just turn off our microphones and build trust. And people were so friendly, showed us around. One of the main characters took us to his house, his farm. Showed us his barn that’s full of ‘elephants’, Republican paraphernalia. He [also] had toilet paper with Hillary Clinton’s face on it. All kinds. It was just so different from the kind of world I usually cover.”
Wong also helped us better understand The Economist’s editorial process, particularly with new media formats. When she moved to Singapore, she had completed one hugely successful podcast, “The Prince”, which is about Xi Jinping. As she was reporting around South-east Asia for the publication, whispers of scams everywhere, her editor in London asked her to keep an eye out for any story that could be turned into another long-form, narrative podcast series. “Oh, this is great, because The Economist is known for very nerdy, business, finance, trade reporting, but this was an opportunity for me to do that kind of nerdy reporting mixed with true crime, like a true crime podcast.”
She later said: “We generally pitch our stories, whether it's a 400-word piece in the paper this week or a nine-month podcast project. The pitches aren't that long; couple of paragraphs. Then the editors, who are sort of commissioning, will consider the pitches and maybe come to the correspondent and ask for follow-ups and talk about how we might report it. But we're given quite a bit of autonomy…it would have been very difficult for me to make ‘Scam Inc’ if I hadn't already been on the beat. And I think it's the same with my previous series, ‘The Prince’...I covered China for 10 years. So in a way, I think both of these projects drew on several years of reporting prior to actually working on the specific project.”
Jom’s next event on July 30th will feature Sunil Amrith, Yale historian, in conversation with Faris Joraimi, Jom’s history editor, about The Burning Earth, the former’s much-acclaimed book from last year. Jom’s paying members will get priority access to this free event. Get a paid membership today.
