US Sanctions Cambodian Tycoon For Human Trafficking And Investment Scams

The US government on Thursday slapped sanctions on a Cambodian businessman over allegations he and entities he controlled trafficked and abused people forced to work in online scam centers.

The Treasury Department said it was taking action against Ly Yong Phat, his conglomerate L.Y.P. Group, Lt. and his O-Smach Resort.

It also sanctioned Cambodia-based Garden City Hotel, Koh Kong Resort and Phnom Penh Hotel for being owned and controlled by Ly.

A statement from the Treasury Department said O'Smach Resort had been the subject of investigations between 2022 to 2024 "for extensive and systemic serious human rights abuse."

The alleged victims said they were lured to work at O-Smach with promises of employment and free housing, but then threatened with having their phones and passports confiscated when they arrived and forced to work in scam operations under "horrifying" conditions.

"People who called for help reported being beaten, abused with electric shocks, made to pay a hefty ransom, or threatened with being sold to other online scam gangs. There have been two reports of victims jumping to their death from buildings within O‑Smach Resort," the statement said.

The traffickers forced the workers to labor up to 15 hours a day and often would "resell" them to other scam operations or force them into sex trafficking.

The Treasury Department said the scammers used fictitious identities and unfurled complex stories to develop trusted relationships with people in on effort to deceive them.

"In many cases, this involves convincing victims to invest in virtual currency, or in some cases, over-the-counter foreign exchange schemes," the department said.

"Today's action underscores our commitment to hold accountable those involved in human trafficking and other abuses, while also disrupting their ability to operate investment fraud schemes that target countless unsuspecting individuals, including Americans," acting Under Secretary of the Treasury for Terrorism and Financial Intelligence Bradley T. Smith said in a statement.

"Treasury will continue to shine a light on the criminal networks operating these illicit schemes and those who seek to perpetrate these abuses."

Local authorities conducted rescue missions at O-Smach Resort, including in October 2022 and March 2024, and freed people of many different nationalities, including Chinese, Indian, Indonesian, Malaysian, Singaporean, Thai and Vietnamese.

The statement said that Americans were targeted by the schemes.

"In 2022, in the U.S alone, victims reported losses of $2.6 billion from pig butchering - a type of long-term scam – and other crypto fraud, more than double the previous year, according to the FBI," it said.

The US government said it worked with Cambodia to put the online scammers out of business.