1 00:00:03,880 --> 00:00:07,120 Speaker 1: From The Australian. Here's what's on the front. I'm Christinamio. 2 00:00:07,400 --> 00:00:14,440 Speaker 1: It's Monday, May twenty. Voters aren't convinced by the Treasurer's 3 00:00:14,440 --> 00:00:17,799 Speaker 1: promise that the government's big spending budget, handed down last 4 00:00:17,840 --> 00:00:22,040 Speaker 1: Tuesday won't push up inflation. That's according to new data 5 00:00:22,079 --> 00:00:25,279 Speaker 1: from Newspoll. Less than a third of people believe they'll 6 00:00:25,320 --> 00:00:28,800 Speaker 1: be better off even with energy subsidies, tax cuts and 7 00:00:28,920 --> 00:00:32,560 Speaker 1: rent assistance. You can read our experts analysis of the 8 00:00:32,640 --> 00:00:35,839 Speaker 1: latest Newspoll results at the Australian dot com dot au. 9 00:00:38,280 --> 00:00:41,280 Speaker 1: Save your money. That's the recommendation of a high ranking 10 00:00:41,400 --> 00:00:45,279 Speaker 1: United States Navy official, Gloria at Valdez, says the government's 11 00:00:45,360 --> 00:00:48,760 Speaker 1: five billion dollar planned upgrades to the Australian Navy's aging 12 00:00:48,800 --> 00:00:52,800 Speaker 1: Colins class submarines has never been attempted and it could 13 00:00:52,920 --> 00:00:59,200 Speaker 1: leave us vulnerable if it doesn't work out. Australia's corporate 14 00:00:59,240 --> 00:01:03,560 Speaker 1: regulator to notify thirty four thousand scam victims of their predicament. 15 00:01:04,200 --> 00:01:07,560 Speaker 1: That's despite a heads up from international law enforcement agencies 16 00:01:07,640 --> 00:01:11,120 Speaker 1: almost a year ago. It follows an investigation by The 17 00:01:11,160 --> 00:01:15,039 Speaker 1: Australian which revealed weaknesses in our banking and government regulations 18 00:01:15,400 --> 00:01:19,640 Speaker 1: make Australians easy targets for Southeast Asian scam factories. That's 19 00:01:19,680 --> 00:01:31,920 Speaker 1: today's episode. A warning before we start. This episode contains 20 00:01:31,959 --> 00:01:40,600 Speaker 1: mention of torture, physical violence and sexual exploitation. Not too 21 00:01:40,640 --> 00:01:43,279 Speaker 1: long ago, the marriage of a South Australian public servant 22 00:01:43,360 --> 00:01:46,920 Speaker 1: where calling John hit a rough patch. It was during 23 00:01:46,959 --> 00:01:49,960 Speaker 1: that time that he received a Facebook friend request from 24 00:01:49,960 --> 00:01:54,720 Speaker 1: an attractive Ukrainian woman named Vira. She told him she 25 00:01:54,840 --> 00:01:57,720 Speaker 1: was recently single and living on the Sunshine Coast where 26 00:01:57,720 --> 00:02:01,640 Speaker 1: she ran a business importing kid's clothing. After a couple 27 00:02:01,680 --> 00:02:05,280 Speaker 1: of days, the conversation moved to WhatsApp. It's an encrypted 28 00:02:05,320 --> 00:02:09,160 Speaker 1: messaging platform, meaning sensitive information can be exchanged more freely. 29 00:02:10,360 --> 00:02:13,399 Speaker 1: Vera asked John if he had any interest in cryptocurrency. 30 00:02:13,800 --> 00:02:16,680 Speaker 1: As it happened he did. He'd recently invested a bit 31 00:02:16,680 --> 00:02:20,040 Speaker 1: of money on a legitimate crypto trading site called coinspot. 32 00:02:21,200 --> 00:02:24,880 Speaker 1: With Vera's encouragement, John opened a new crypto trading account 33 00:02:24,960 --> 00:02:28,400 Speaker 1: on a different website, and this time he went big. 34 00:02:29,200 --> 00:02:32,400 Speaker 1: Within twenty days, he'd poured more than two hundred thousand 35 00:02:32,440 --> 00:02:35,400 Speaker 1: dollars into the scheme. All of the cash he and 36 00:02:35,480 --> 00:02:38,239 Speaker 1: his wife had saved up over several years to buy 37 00:02:38,240 --> 00:02:41,720 Speaker 1: a house. It was only when he tried to withdraw 38 00:02:41,800 --> 00:02:49,560 Speaker 1: his money that John realized he'd been duped. We've all 39 00:02:49,600 --> 00:02:53,000 Speaker 1: heard enough scam horror stories to know where this story ends. 40 00:02:53,680 --> 00:02:56,960 Speaker 1: There was no Verra. She was concocted by a team 41 00:02:57,000 --> 00:03:00,600 Speaker 1: of scammers running countless similar scams somewhere in Asia. 42 00:03:01,440 --> 00:03:04,680 Speaker 2: That is still an active profile, and I can see 43 00:03:04,720 --> 00:03:08,600 Speaker 2: from that profile it is still drawing new people in. 44 00:03:09,360 --> 00:03:12,560 Speaker 1: Amanda Hodge is The Australian's Southeast Asia correspondent. 45 00:03:13,520 --> 00:03:17,520 Speaker 3: So anyone out there, if you're in contact with Vera Pittskaya, 46 00:03:17,600 --> 00:03:23,080 Speaker 3: I suggest you block her now because it's a real worry. 47 00:03:23,919 --> 00:03:27,320 Speaker 1: It's called pig butchering by those in the business. Just 48 00:03:27,440 --> 00:03:31,560 Speaker 1: like pigs being fattened for slaughter. Victims are slowly, expertly 49 00:03:31,840 --> 00:03:34,399 Speaker 1: lured into a false sense of confidence by their new 50 00:03:34,480 --> 00:03:37,760 Speaker 1: online love interest, then they go in for the kill. 51 00:03:39,400 --> 00:03:42,520 Speaker 1: Southeast Asia is quickly becoming the pig butchering capital of 52 00:03:42,560 --> 00:03:46,920 Speaker 1: the world, with countless scam factories targeting thousands of people 53 00:03:46,960 --> 00:03:50,920 Speaker 1: online every year. To say it's a big problem would 54 00:03:50,960 --> 00:03:54,840 Speaker 1: be an understatement. Experts estimate scamming is now the third 55 00:03:54,920 --> 00:03:58,840 Speaker 1: biggest economy in the world, behind the United States and China, 56 00:03:59,240 --> 00:04:03,000 Speaker 1: bringing in trillions of dollars every year, and Australians like 57 00:04:03,080 --> 00:04:06,320 Speaker 1: John are increasingly being targeted because our banking and government 58 00:04:06,400 --> 00:04:09,240 Speaker 1: regulations are easier to get around than those in place 59 00:04:09,280 --> 00:04:12,960 Speaker 1: in the US or Europe. One form of scammer Amanda 60 00:04:13,000 --> 00:04:15,360 Speaker 1: spoke to on a recent trip to King's Romans in 61 00:04:15,440 --> 00:04:19,760 Speaker 1: Northern Laos made it crystal clear this is by design. 62 00:04:20,400 --> 00:04:27,200 Speaker 4: Because the bearing system and the government they make us 63 00:04:27,320 --> 00:04:31,880 Speaker 4: too easier than Europe. At the office, they said, like 64 00:04:32,520 --> 00:04:38,560 Speaker 4: America is dumb and more change more expert to scam 65 00:04:38,640 --> 00:04:43,279 Speaker 4: Australian because they are more smarter than America. 66 00:04:44,240 --> 00:04:47,520 Speaker 1: If Australian authorities are aware of the extent of the problem, 67 00:04:47,839 --> 00:04:49,800 Speaker 1: it's not clear what they're doing about it. 68 00:04:50,600 --> 00:04:54,760 Speaker 2: My understanding is they haven't quite pivoted towards scamming it. 69 00:04:54,800 --> 00:04:59,360 Speaker 2: They're so heavily focused on transnational drug syndicates, which is 70 00:04:59,520 --> 00:05:01,640 Speaker 2: fair enough and has been the biggest issue in this 71 00:05:01,720 --> 00:05:03,960 Speaker 2: region for a long time. But this is now the 72 00:05:03,960 --> 00:05:06,960 Speaker 2: priority and I don't think they've been fast enough to pivot. 73 00:05:07,279 --> 00:05:09,640 Speaker 3: That's my understanding. I wanted to check with them. 74 00:05:09,839 --> 00:05:13,320 Speaker 2: Unfortunately, the interview with the Australian Federal Police was canceled 75 00:05:13,400 --> 00:05:16,160 Speaker 2: and they had a series of written questions they undertook 76 00:05:16,200 --> 00:05:20,200 Speaker 2: to provide answers before publication, and they didn't. I was, 77 00:05:20,640 --> 00:05:23,400 Speaker 2: to be honest, quite surprised and disappointed. 78 00:05:24,080 --> 00:05:27,679 Speaker 1: The Australian's National Crime correspondent, David Murray is reporting today 79 00:05:27,720 --> 00:05:31,279 Speaker 1: the Australian Securities and Investments Commission has been accused of 80 00:05:31,320 --> 00:05:34,120 Speaker 1: dropping the ball on an international scam syndicate that cost 81 00:05:34,160 --> 00:05:38,560 Speaker 1: Ossie's more than two hundred million dollars. A German police 82 00:05:38,600 --> 00:05:41,960 Speaker 1: representative told Dave they alerted the corporate regulator to the 83 00:05:41,960 --> 00:05:45,680 Speaker 1: scam in June of last year and they provided the name, 84 00:05:45,920 --> 00:05:50,160 Speaker 1: contact details and financial losses of thirty four thousand Australians 85 00:05:50,160 --> 00:05:53,200 Speaker 1: who fell victim to it, but ask has yet to 86 00:05:53,240 --> 00:06:00,839 Speaker 1: make contact with any of them. It all begins with 87 00:06:00,880 --> 00:06:03,440 Speaker 1: the handing back of Hong Kong and the famed gambling 88 00:06:03,520 --> 00:06:05,640 Speaker 1: enclave of Macau to China. 89 00:06:06,040 --> 00:06:09,240 Speaker 2: So it cracked down very hard on money laundering around 90 00:06:09,240 --> 00:06:13,120 Speaker 2: twenty nineteen, and it also made an example of a 91 00:06:13,120 --> 00:06:16,440 Speaker 2: couple of very big Chinese casino kingpins who are now 92 00:06:16,440 --> 00:06:21,080 Speaker 2: in jail, so that those anti money laundering measures caused 93 00:06:21,080 --> 00:06:26,600 Speaker 2: a flight of casinos and casino kingpins and crime syndicates 94 00:06:26,640 --> 00:06:29,200 Speaker 2: out of Macau, and they were looking for more permissive 95 00:06:29,279 --> 00:06:33,200 Speaker 2: environments and they found more than they needed in Southeast 96 00:06:33,240 --> 00:06:37,680 Speaker 2: Asia exactly because of these underregulated special economic zones like 97 00:06:38,279 --> 00:06:42,240 Speaker 2: the Golden Triangle. These are all notorious enclaves that have 98 00:06:42,640 --> 00:06:46,960 Speaker 2: attracted huge amounts of Chinese money, a lot of it elicit, 99 00:06:47,320 --> 00:06:51,640 Speaker 2: and of course the criminal syndicates behind those money flows 100 00:06:51,760 --> 00:06:56,720 Speaker 2: are also now deeply embedded into those economies, into the 101 00:06:56,720 --> 00:06:58,479 Speaker 2: politics of those areas as well. 102 00:06:59,320 --> 00:07:00,640 Speaker 1: And then pandemic. 103 00:07:01,960 --> 00:07:05,360 Speaker 2: So the pandemic forced these casinos online, and they had 104 00:07:05,400 --> 00:07:08,760 Speaker 2: this fantastic new market, because so did everyone else. 105 00:07:08,839 --> 00:07:10,400 Speaker 3: When the pandemic. 106 00:07:10,280 --> 00:07:13,560 Speaker 2: Closed borders forced people to stay at home. 107 00:07:13,800 --> 00:07:14,880 Speaker 3: What else was there to do? 108 00:07:15,000 --> 00:07:17,360 Speaker 2: We all did the same thing, right, We had our 109 00:07:17,760 --> 00:07:20,920 Speaker 2: work meetings, our social gatherings on zoom. 110 00:07:21,680 --> 00:07:23,560 Speaker 3: These criminal syndicates. 111 00:07:23,080 --> 00:07:27,000 Speaker 2: Found that they could reach so many other people as well. 112 00:07:27,760 --> 00:07:28,600 Speaker 3: I think people were. 113 00:07:28,560 --> 00:07:32,720 Speaker 2: Vulnerable because they felt lonely and maybe more amenable to 114 00:07:32,960 --> 00:07:39,120 Speaker 2: those kind of strange, spontaneous approaches that most of us 115 00:07:39,120 --> 00:07:40,760 Speaker 2: would normally be suspicious about. 116 00:07:41,280 --> 00:07:43,800 Speaker 3: And so you know, here was this amazing new. 117 00:07:43,680 --> 00:07:46,720 Speaker 2: Market, and they already had the tools to reach them 118 00:07:46,800 --> 00:07:50,680 Speaker 2: through the online gambling networks, they had the money laundering networks. 119 00:07:50,920 --> 00:07:54,960 Speaker 2: They suddenly had the cryptocurrency platforms, and tens of millions 120 00:07:55,000 --> 00:07:58,720 Speaker 2: of fake cryptocurrency platforms have since been created just for 121 00:07:58,800 --> 00:08:02,960 Speaker 2: this purpose, to be funnel money, not only as a 122 00:08:03,000 --> 00:08:05,160 Speaker 2: sort of draw card for people who are interested in 123 00:08:05,200 --> 00:08:08,120 Speaker 2: making quick money out of cryptocurrency, but as a way 124 00:08:08,120 --> 00:08:11,280 Speaker 2: of laundering that money, you know, through the system, because 125 00:08:11,280 --> 00:08:15,280 Speaker 2: once it's in a cryptocurrency account, it's gone. 126 00:08:17,320 --> 00:08:20,240 Speaker 1: Many experts believe China is the only country with the 127 00:08:20,280 --> 00:08:23,600 Speaker 1: resources and a regional influence to really tackle the so 128 00:08:23,720 --> 00:08:28,200 Speaker 1: called scamdemic, and that puts Australian authorities in a tough spot. 129 00:08:28,880 --> 00:08:32,079 Speaker 1: See the unique geopolitics of our region makes clamping down 130 00:08:32,080 --> 00:08:35,960 Speaker 1: on cyber scams just that bit harder. Our relationship with 131 00:08:36,040 --> 00:08:38,360 Speaker 1: China is out of the freezer, but it's not yet 132 00:08:38,400 --> 00:08:42,080 Speaker 1: fully thawed, and tensions over China's rising influence in the 133 00:08:42,080 --> 00:08:46,000 Speaker 1: Pacific means progress is slow. So what do we do. 134 00:08:46,880 --> 00:08:50,200 Speaker 2: It's a really tricky question because the things I'm hearing 135 00:08:50,240 --> 00:08:53,920 Speaker 2: from regional experts point to the fact that the geopolitics 136 00:08:53,960 --> 00:08:56,120 Speaker 2: is really getting in the way of what needs to 137 00:08:56,160 --> 00:08:58,320 Speaker 2: be an international cooperative effort. 138 00:08:58,360 --> 00:09:00,920 Speaker 3: There's no other way to get around this, right. 139 00:09:01,200 --> 00:09:04,760 Speaker 2: Cooperation between China, the US and Australia has in the 140 00:09:04,840 --> 00:09:07,960 Speaker 2: past busted some of the biggest drug syndicates operating in 141 00:09:08,000 --> 00:09:11,640 Speaker 2: Southeast Asia, but those days of cooperation are. 142 00:09:11,600 --> 00:09:12,680 Speaker 3: Gone for the moment. 143 00:09:13,080 --> 00:09:16,120 Speaker 2: And the other complication is that for China, this is 144 00:09:16,200 --> 00:09:19,840 Speaker 2: a tricky one because it's embarrassing for China as well. 145 00:09:19,920 --> 00:09:24,760 Speaker 2: Right China is doing quite a bit to protect its 146 00:09:24,800 --> 00:09:29,160 Speaker 2: own citizens. It's deporting Chinese workers, whether they have been 147 00:09:29,440 --> 00:09:32,599 Speaker 2: compelled or not, because it is putting pressure on countries 148 00:09:32,760 --> 00:09:36,120 Speaker 2: like Me and Myra in particular, but it is not 149 00:09:36,559 --> 00:09:41,600 Speaker 2: really doing anything about scam compounds. Once they stop targeting 150 00:09:41,720 --> 00:09:46,080 Speaker 2: Chinese citizens and once they stop trafficking Chinese scam workers. 151 00:09:46,559 --> 00:09:49,440 Speaker 2: China is the economic giant in the region. If it 152 00:09:49,559 --> 00:09:53,200 Speaker 2: wanted to clamp down on this, it really could, but 153 00:09:53,880 --> 00:09:56,920 Speaker 2: it's really only interested in making sure it doesn't hurt 154 00:09:56,920 --> 00:10:01,160 Speaker 2: its own citizens right now. From China's perspective, Beijing's perspective, 155 00:10:01,400 --> 00:10:04,960 Speaker 2: it probably doesn't see a lot of upside in troubling 156 00:10:05,000 --> 00:10:08,679 Speaker 2: itself with trying to clap down for the benefit of 157 00:10:09,320 --> 00:10:11,920 Speaker 2: Western powers that aren't playing ball. 158 00:10:15,800 --> 00:10:18,080 Speaker 1: Coming up why the people on the other side of 159 00:10:18,120 --> 00:10:21,600 Speaker 1: the scam can be victims too. Our foreign correspondents do 160 00:10:21,679 --> 00:10:24,440 Speaker 1: this kind of in depth reporting and analysis every day, 161 00:10:24,840 --> 00:10:28,040 Speaker 1: and subscribers to The Australian get unlimited access to their 162 00:10:28,040 --> 00:10:31,400 Speaker 1: insights and expertise. Check us out at the Australian dot 163 00:10:31,400 --> 00:10:50,400 Speaker 1: com dot au. We'll be back after this break. Policing 164 00:10:50,440 --> 00:10:53,560 Speaker 1: international scams is a double edged sword because some of 165 00:10:53,600 --> 00:10:56,360 Speaker 1: the people running the cons aren't there of their own 166 00:10:56,440 --> 00:11:00,400 Speaker 1: free will. Many are trafficked into the so called scam 167 00:11:00,440 --> 00:11:04,240 Speaker 1: factories by recruiters. They know they're soul dreams of well 168 00:11:04,280 --> 00:11:07,880 Speaker 1: paid jobs at reputable companies, but the reality is more 169 00:11:07,920 --> 00:11:11,920 Speaker 1: like a nightmare. New recruits to the compounds operating inside 170 00:11:11,920 --> 00:11:16,199 Speaker 1: special economic zones dotted around Southeast Asia are indoctrinated through 171 00:11:16,280 --> 00:11:20,199 Speaker 1: so called scam universities. It's a training program in which 172 00:11:20,240 --> 00:11:22,480 Speaker 1: they're taught the ins and outs of the Australian banking 173 00:11:22,520 --> 00:11:28,800 Speaker 1: system and culture. Things go downhill from there. What you're 174 00:11:28,840 --> 00:11:31,680 Speaker 1: hearing is a scammer being viciously attacked for their on 175 00:11:31,800 --> 00:11:36,559 Speaker 1: the job performance. Many scammers just like them are physically 176 00:11:36,559 --> 00:11:39,600 Speaker 1: and financially trapped by their employers, who force them to 177 00:11:39,640 --> 00:11:42,160 Speaker 1: work seven days a week and demand they pay debts 178 00:11:42,200 --> 00:11:44,440 Speaker 1: in the thousands of dollars if they want to leave. 179 00:11:45,559 --> 00:11:48,800 Speaker 1: Those who refuse to work are beaten, tortured, and raped. 180 00:11:49,600 --> 00:11:53,920 Speaker 1: Some are electrocuted and others are sexually exploited. They're routinely 181 00:11:53,960 --> 00:11:58,359 Speaker 1: deprived of food and sleep, sometimes both, and they're increasingly 182 00:11:58,440 --> 00:12:00,839 Speaker 1: lured to the scam factories from as far away as 183 00:12:00,840 --> 00:12:05,120 Speaker 1: South America, East Africa, and even Western Europe. More often 184 00:12:05,120 --> 00:12:09,760 Speaker 1: than not, their passports are confiscated, making leaving virtually impossible. 185 00:12:10,800 --> 00:12:14,760 Speaker 3: It's completely altered their lives. In many cases, it's ruined 186 00:12:14,800 --> 00:12:15,440 Speaker 3: their lives. 187 00:12:16,040 --> 00:12:19,480 Speaker 2: Young people in particular, who have finished their education, often 188 00:12:19,720 --> 00:12:24,520 Speaker 2: university educations, quite fluent in English, computer literate, very smart 189 00:12:25,080 --> 00:12:29,720 Speaker 2: young people, but facing unemployment rates within their age groups 190 00:12:29,720 --> 00:12:33,520 Speaker 2: of twenty twenty five percent, no chance of getting a job, 191 00:12:33,800 --> 00:12:37,199 Speaker 2: looking for a way out of what looks very much 192 00:12:37,280 --> 00:12:41,199 Speaker 2: like a dead end, and so they too were incredibly vulnerable, 193 00:12:41,320 --> 00:12:45,320 Speaker 2: particularly because these jobs sounded so great, they were paying 194 00:12:45,360 --> 00:12:49,520 Speaker 2: so much more, and in sadly actually so many cases, 195 00:12:50,160 --> 00:12:53,800 Speaker 2: the job prospects were being reinforced by people they knew 196 00:12:53,840 --> 00:12:57,280 Speaker 2: who were recruiting them because they were getting a bonus 197 00:12:57,679 --> 00:13:01,600 Speaker 2: and maybe that was their ticket out too, so it's 198 00:13:01,760 --> 00:13:04,720 Speaker 2: just this terrible, vicious cycle. 199 00:13:08,360 --> 00:13:14,160 Speaker 1: Amanda Hodge is The Australian's Southeast Asia correspondent. You can 200 00:13:14,200 --> 00:13:17,559 Speaker 1: read her full investigation into the region's scam factories, as 201 00:13:17,559 --> 00:13:20,760 Speaker 1: well as additional reporting by National Crime correspondent David Murray, 202 00:13:20,880 --> 00:13:23,280 Speaker 1: right now at the Australian dot com dot au