Cambodian Senator Sanctioned for Crypto Scams and Human Trafficking Linked to Global Criminal Network

YEREVAN (CoinChapter.com) — The U.S. Treasury has imposed sanctions on Cambodian Senator Ly Yong Phat and his businesses due to their involvement in crypto scams and human trafficking. Investigations revealed that the Senator’s companies, including L.Y.P Group and O-Smash Resort, played a key role in these illicit operations.

U.S. Treasury Sanctions Cambodian Senator for Crypto Scams and Human Trafficking

The Office of Foreign Assets Control (OFAC) of the U.S. Treasury issued sanctions against Ly Yong Phat for his involvement in coordinating crypto scams and human trafficking schemes. As the investigation unfolded, it became clear that Ly’s businesses lured victims with false job offers. Once they arrived, their phones and passports were confiscated, leaving them no choice but to participate in scam operations.

These victims were used in crypto scams, specifically through a fraudulent practice known as “pig butchering,” where they built fake relationships with unsuspecting targets. The goal was to convince these individuals to invest in fraudulent cryptocurrency schemes. Those who attempted to escape were tortured. Local authorities rescued victims from various countries, including China, India, and Indonesia, during missions conducted from October 2022 to March 2024.

OFAC Targets Cambodian Hotels Linked to Human Trafficking and Crypto Fraud

OFAC also sanctioned several Cambodian hotels for their connection to Ly Yong Phat. These hotels—Garden City Hotel, Koh Kong Resort, and Phnom Penh Hotel—played a role in human trafficking operations. Moreover, the U.S. Department of State’s 2024 Trafficking in Persons (TIP) Report highlighted widespread corruption and official complicity in Cambodia, which allowed these crimes to flourish.

The report highlighted how these trafficking networks operated with little interference from law enforcement. While some raids were conducted, the enforcement efforts were often selective and politically motivated. Still, multiple rescue missions managed to free victims trapped in these trafficking rings.

U.S. Treasury and Tether Act Against Crypto Fraud in Cambodia

In July, Tether froze $28 million USDT after discovering its connection to crypto fraud and human trafficking in Cambodia. Investigators quickly traced these funds back to the Huione Group, which has close ties to Cambodia’s ruling Hun family. Additionally, the Huione Group faces accusations of generating $11 billion through a range of illegal activities, including crypto scams and trafficking operations.

Moreover, the FBI’s Internet Crime Complaint Center (IC3) has consistently warned about the increasing number of crypto scams and fraud schemes emerging from Southeast Asia. In addition, criminal organizations in the region have been using cryptocurrencies to drive these illegal activities. In response, OFAC’s sanctions on Ly Yong Phat signal a significant step toward addressing these escalating threats.

Meanwhile, authorities continue to investigate Ly Yong Phat and the businesses tied to his criminal network. These efforts aim to uncover the full extent of their involvement in human trafficking and crypto fraud. As the investigation progresses, more details about the scope of these crimes will likely emerge.