Shwe Kokko: The Making of a Transnational Scam City

Shwe Kokko, sometimes called Shwe Kokko New City, is a small border town in Myanmar’s Karen State that has become “one of the largest and most notorious cyber scam hubs in Southeast Asia.” Beginning in 2017, Chinese investors, notably She Zhijiang, aka Tang Kriang Kai, head of Yatai International Holdings, were granted permission to build a sprawling “new city” development on this farmland island along the Thai border. Under the protection of the Tatmadaw-aligned Karen National Army (KNA) led by Colonel Saw Chit Thu, Shwe Kokko quickly filled with high-rise hotels, casinos, and call centers instead of the promised housing.

Within a few years, the entire area transformed into a gated scam city, complete with watchtowers, generators, and guarded compounds, where mostly Chinese criminals run online fraud syndicates. In Treasury Department briefings, Shwe Kokko is described as a notorious investment-scam hub under KNA protection and the KNA’s headquarters. By 2025, the U.S. Treasury Department and other sources reported that She Zhijiang and Saw Chit Thu “transformed a small village on the Moei River into a resort city custom-built for scams targeting people around the world, particularly Americans”.

Geographically, Shwe Kokko lies in Myawaddy Township, right on the Moei River bordering Thailand. Control of Shwe Kokko has long been conceded to the Karen militia, formerly the “Border Guard Force.” In practice, the junta’s reach had been very thin at the location. Until 2025, the compound operated with near-total autonomy under KNA authority, until junta-allied forces, under U.S. pressure, staged raids. Journalists and analysts describe Shwe Kokko as “scam city,” where the de facto operators are Chinese crime syndicates supported by the Karen militia, a cooperative venture that has enriched both parties.

How Shwe Kokko Became Notorious

Shwe Kokko’s fall from sleepy village to “scam city” has been dramatic. In 2018, Myanmar’s civilian government under Aung San Suu Kyi approved the first phase of the Yatai New City development in Shwe Kokko. The MIC’s approval in July 2018 was limited to a small first phase involving about 25.5 acres and a relatively modest investment for high-end villas, not the entire Yatai New City development concept. A Chinese consortium, led by She Zhijiang’s Yatai International, began clearing forest and building urban infrastructure.

Initially, it was billed as a Chinese investment zone with hotels, casinos, and industry. By 2019, however, journalists and locals were raising alarms: thousands of Chinese were entering the area and building beyond permits, and reports linked the project to Chinese crime networks and money laundering. The Myanmar government formed a tribunal that found the developers had vastly overstepped their concessions; the promised $15 billion special zone was far larger than approved. In late 2020, the NLD administration formally suspended the Shwe Kokko project. Thai authorities even cut electricity and internet to the area.

These early interventions stalled but did not stop the compound’s growth. The 2020 crackdown in Cambodia, when Cambodia banned online gambling, sent many Chinese operators fleeing to Myanmar. By early 2021, even before the coup, some sources say scam sites were already active in Shwe Kokko, with buildings lit at night for crypto scam operations. Then came the February 2021 military coup. Overnight, the tenuous civilian control vanished. The junta, fighting rebellions on multiple fronts, was eager to court the support of border militias like Saw Chit Thu’s Karen BGF. Under the new regime, Yatai’s Shwe Kokko project was quietly reactivated. Within months, electricity and services were restored, and by late 2021 the first big fraud compounds were reported operating inside Shwe Kokko. Observers noted that Myanmar’s conflict economy had embraced these cybercrime hubs as a revenue source.

From 2022 onward, Shwe Kokko thrived as a phantom city: multi-story casino-hotels were built at breakneck pace; casinos and call centers opened even as COVID lockdowns raged elsewhere. Chinese flights continued to Mae Sot to ferry in workers. By 2023, international media and analysts documented Shwe Kokko’s reality as a crime zone. The U.S. Treasury and UN agencies repeatedly singled it out as a major scam center. For example, a Treasury press release in 2025 explicitly names Yatai New City in Shwe Kokko, crediting She Zhijiang and Saw Chit Thu for turning the village “into a resort city custom-built for gambling, drug trafficking, prostitution, and scams.” At that point, Shwe Kokko had become a global household name in scam reporting, alongside KK Park in Myawaddy.

Even when Myanmar’s elections were briefly held in 2020, the generals had already shown a willingness to exploit Shwe Kokko. The civilian probe in 2020 only restrained it, but after the coup, the junta looked the other way or even facilitated the site. Satellite imagery confirms that construction and security works in Shwe Kokko continued unabated post-2021. By early 2024, Shwe Kokko’s skyline was dotted with brand-new office blocks and hotels.

Functioning and Scale of the Scam

The scam centers in Shwe Kokko and nearby compounds operate as prison-like fraud factories, where workers are held captive and forced to carry out sophisticated online scams. According to the U.S. Treasury, individuals are “lured or trafficked into prison-like call centers” and coerced through threats, physical abuse, or violence to defraud strangers online. These workers typically target victims through social media and messaging platforms, posing as attractive or trustworthy strangers and manipulating emotions such as loneliness or greed.

Victims, often older Westerners or Chinese nationals, are drawn in through fake romantic relationships or investment opportunities, a scheme commonly known as “pig butchering.” Scammers gradually build trust, then persuade victims to transfer money into fraudulent cryptocurrency or trading platforms under the criminals’ control. Over weeks or months, victims are shown fabricated investment returns and encouraged to commit increasingly larger sums until the scammers abruptly vanish. Individual schemes have resulted in losses totaling hundreds of millions of dollars, leaving victims financially devastated.

Inside Shwe Kokko and similar Myanmar sites, workers are under constant guard. Reports describe them locked in rooms with armed guards, watchtowers, and checkpoints. Escaped victims describe brutal punishment for those who underperform: being beaten with stun guns, held in small cells, forced into sex work, or tortured if they fall short of quotas. Survivors say victims were held hostage for ransom, beaten for missed targets, and forced to work up to 18 hours a day answering calls and chats. In practice, the “scam center” is a labor camp: employees must message and dupe hundreds of potential targets daily; failing quotas can bring severe reprisal.

ASPI satellite analysis found the number of Myanmar scam compounds on the Thai border growing from about 11 before 2021 to around 27 by late 2025. The U.S. AP noted that KK Park, a major site in Myawaddy, was “one of around 30 scam compounds” on the border. Shwe Kokko itself is often described as one of those compounds, sometimes labeled “Yatai New City,” with multiple call centers under one fence. In Shwe Kokko alone, there are multiple “centers” inside the one development, though independent counts are hard. The 2025 Treasury sanctions listed nine companies tied to Shwe Kokko fraud.

In short, there are dozens of these facilities. Along with Shwe Kokko, notable scam hubs on Myanmar’s borders include KK Park, Tai Chang, Hengsheng Park, Jinxin, Huanya, Dongfanghui, and others around Myawaddy. Each compound may host hundreds or thousands of scammers. Reuters reports Thai police estimate about 100,000 people are held in Myanmar scam centers bordering Thailand, and the industry extracts “tens of billions of dollars” annually from worldwide victims. Over the whole region, the UN has warned of 120,000+ workers in Myanmar and 100,000 in Cambodia as of 2023.

Money in the scam industry

In 2022, Americans lost about $2.0 billion to online scams, and in 2023, about $3.5 billion. By 2024, this surged further; the U.S. Treasury reported that Americans lost “over $10 billion” in 2024 to Southeast Asia-based scams. This reflects not just Shwe Kokko but also operations in Cambodia, Laos, and elsewhere. The UN and NGOs emphasize how trafficking at these centers yields massive profits: the UN Office on Drugs and Crime warns that border scam hubs worldwide, including Shwe Kokko, have stolen “tens of billions of dollars each year” from victims. Shwe Kokko constitutes one element of a transnational scam network; U.S. loss estimates are global in scope and not specific to Myanmar.

Regionally, the sums are huge. A November 2025 report cited the United Nations as saying scammers have “earned billions of dollars from the trafficking of hundreds of thousands of people forced to work in these compounds”. Through trafficking alone, the UN estimates billions extracted from global victims. Survivors freed tell of being ordered to scam Americans out of life savings and hefty cryptocurrency investments.

Some U.S. courts have noted that these are not “small-time” grifts; one gambit led to 12.63 billion baht in cryptocurrency circulation across 239 bogus gambling websites, networks tied to Shwe Kokko associates. A United States Institute of Peace report estimated the Shwe Kokko project yields roughly $384 million per year, of which KNA leader Saw Chit Thu’s group remits about 50%, or about $192 million, to the junta. Combined with numerous compounds in Myawaddy, the scam “economy” funds much of the border militia networks and fills their pockets.

Finally, besides direct fraud, there is ancillary money: gangs traffic drugs and counterfeit goods through these areas, laundered via hotels and casinos. Official U.S. statements describe Shwe Kokko as tailored for “gambling, drug trafficking, prostitution, and scams” targeting international victims. All told, analysts describe the scam center industry around Shwe Kokko as a multibillion-dollar machine. Every dollar lost by victims is profit for the networks, funneling into more development of compounds and fueling the Burmese conflict economy.

Other scam cities in Myanmar and China

Shwe Kokko is not unique in Myanmar’s criminal underworld. The town of Myawaddy, just across the river from Mae Sot, Thailand, is the epicenter of much of this activity. For years, it has hosted sites like KK Park, Jinxin Park, Blue Diamond, Dongmei, etc., all notorious scam centers. These Myawaddy compounds are often Chinese-run and Karen-controlled. Other Myanmar border towns have also seen scams, though on a smaller scale: for example, Tachileik, Shan State, on the Thai border, and some areas of Kokang/Kachin have had smaller crypto/call center sites. Chinese nationals in Myanmar’s Shan hills were detained by China in 2023. But by far the densest clusters are in Karen State, Shwe Kokko, and Myawaddy, and contiguous areas controlled by Tatmadaw –allied Karen militias.

Are there scam centers in China? Not in the sense of legally operating compounds: these fraud rings strictly operate outside China, partly because mainland China bans gambling and harshly prosecutes fraud. However, Chinese nationals run many of the Myanmar and regional scam sites, and Chinese authorities have become deeply involved in countering them. In recent years, China has carried out high-profile crackdowns. In January 2024, 11 members connected to the Ming crime family, a Kokang-based gang, were sentenced to death for their role in a Myanmar scam network by late 2025. China reported executing the 11 defendants tied to Myanmar scams. China also works with Laos, Thailand, and Myanmar to repatriate suspects and rescued workers. Over 45,000 Chinese nationals were repatriated in late-2023 Shan crackdowns, and in early 2025, China flew home 1,000-plus scam workers rescued from Myanmar.

Domestically in China, these crimes are harshly punished. Many coastal cities, Guangdong, Zhejiang, etc., have seen anti-fraud campaigns after viral cases of Chinese citizens kidnapped into Myanmar scams. But unlike Southeast Asia, there are no openly famous “scam cities” in China; the activity there is underground and dealt with by police. In China’s border regions (Yunnan, Guangxi), authorities also shut down illicit casinos and small scam rings, and thousands of alleged Chinese organizers have been arrested or sentenced. An Al Jazeera report noted Thailand repatriated 260 people of various nationalities after Thai-Myanmar raids, reflecting Chinese vigilance.

In summary, Shwe Kokko and Myawaddy are Myanmar’s best-known scam hubs. Similar illicit compounds have popped up in Cambodia’s Sihanoukville, the Prince Group scheme, and Laos, Bokeo Golden Triangle, and were briefly active in the Philippine Cagayan Freeport, but the China-driven mafia network has largely concentrated on Myanmar since 2020. Within China itself, the government aggressively shuts down any such operations and even executes key criminals, but it does not tolerate anything akin to Shwe Kokko on Chinese soil.

Crackdowns and Junta’s Stance

Officially, Myanmar’s military regime has oscillated between tough talk and half-hearted action. Since the coup, junta leaders have publicly vowed “zero tolerance” toward cyber scams and staged periodic raids on scam compounds. Notably, in late 2023 and 2025, they pointed to high-profile operations: bombing and bulldozing parts of KK Park on the Thai border and announcing raids on Shwe Kokko itself. The junta has at times even said its forces found nothing illegal in these compounds, yet proceeded to arrest foreign workers. For example, in November 2025, a joint operation by junta police and the BGF announced a “final war” on Shwe Kokko; they detained a few hundred workers and destroyed some buildings. The army chief Min Aung Hlaing even toured Karen State, vowing to eliminate such zones, and Myanmar joined a Mekong summit pledge to crack down on telecom fraud.

Over three days from 18 to 20 November 2025, Myanmar’s military regime carried out raids on the notorious Shwe Kokko scam hub in Myawaddy Township, Karen State, detaining 1,016 foreign nationals from 22 countries, according to junta statements. Those detained included 216 Indonesians, 184 Chinese, and 85 Ethiopians, among others. The operation, conducted jointly by junta troops and the regime-aligned Karen Border Guard Force (BGF), targeted 22 buildings used for scam operations. Authorities said they seized 2,653 computers and 21,750 mobile phones, which were allegedly used in online fraud schemes. The detainees were moved to Shwe Kokko Myaing Village while officials began processing information for eventual repatriation. The raids followed a similar operation launched in October against KK Park, where the junta claims to have demolished 182 out of 638 scam-related buildings.

The raids took place amid mounting international pressure, particularly after the United States announced the creation of a Scam Center Strike Force on November 12. Anticipating the crackdown, many scam workers fled before troops arrived. The BGF itself acknowledged that workers had been tipped off in advance, and residents reported thousands of Chinese nationals fleeing Shwe Kokko, causing traffic jams as vehicles streamed out of the area. Videos circulating on social media showed hurried departures, reinforcing criticism that the raids were partly symbolic. The Karen Border Guard Force declared a “final war” on scam centers, while junta leader Min Aung Hlaing framed the crackdown as a “national duty,” following regional pledges made by the six Lancang–Mekong Cooperation countries: China, Cambodia, Laos, Myanmar, Thailand, and Vietnam at a ministerial-level meeting in Kunming to deepen cooperation against telecom and cyber fraud.

In summary, the junta publicly decries scams, but its real commitment is dubious. Official statements blame foreignness or conspiracies, but regime media and local informants admit the military’s allied militia (the BGF/KNA) was behind Shwe Kokko all along. Even the UN notes that these fraud hubs doubled in size after 2021, implying the military’s seizure of power actually allowed the scam industry to expand. Under international pressure, the regime occasionally sends in forces, but those operations often serve more as PR than genuine law enforcement. In practice the Syrian-like civil war means Yangon cannot crack down hard on scam hubs that finance its militia allies. Thus, while the junta claims to hate scams, it has rarely shut them down, unless forced by Chinese or Thai pressure, and has profited indirectly from the proceeds. In summary, for the Junta, it might as well be a necessary evil. 

The Key Figures Involved

Saw Chit Thu is a longtime Karen militia leader who rose through the ranks of Karen insurgent forces before allying with Myanmar’s military. A former officer of the Karen National Liberation Army (KNLA), he broke with the KNLA in 1994 and joined the military-aligned Democratic Karen Buddhist Army (DKBA). In 2010, he signed a ceasefire with the Tatmadaw and transformed his troops into a ten‑battalion Border Guard Force (BGF) under Yangon’s command, with Shwe Kokko as its headquarters. Under successive government watch, Saw Chit Thu became the BGF’s most powerful officer, eventually holding the rank of colonel and general secretary of the BGF. In early 2024, he formally rebranded the BGF as the Karen National Army (KNA). Although the renaming was officially described as an effort to “distance” the force from the junta, observers note that Saw Chit Thu and the KNA have continued to cooperate closely with the military regime, for example, fighting alongside junta troops in operations against Karen rebels as recently as 2026.

Saw Chit Thu is best known as a key facilitator of the region’s cyber‑scam economy. Under his leadership the BGF/KNA has allowed access to large tracts of land in Kayin State to Chinese crime syndicates and provided armed guards and utilities to “scam centers” targeting foreign, especially American, victims. A U.S. Treasury investigation described Shwe Kokko, jointly developed by Saw Chit Thu’s companies and Chinese partners, as an “industrial‐scale” fraud hub where trafficked laborers are forced to run investment scams. The Treasury and Western governments have since branded Saw Chit Thu as one of Myanmar’s top “scam kingpins.”

On May 5, the U.S. Treasury Department’s Office of Foreign Assets Control (OFAC) imposed sanctions on Saw Chit Thu, his two sons—Htoo Eh Moo and Chit Chit—and the Karen National Army (KNA), accusing them of operating a transnational criminal network centered on the scam compounds at Shwe Kokko, just north of the border town of Myawaddy. The UK and EU had previously blacklisted him (and his subordinates) in 2023–24 for human rights abuses and facilitating scam compounds. These measures underscore his notoriety: journalists and analysts describe him as “one of the central figures in Burma’s scam economy,” who has profited from prostitution, gambling, and forced‐labor frauds in KNA-controlled territory.

She Zhijiang is a Chinese businessman, also reported to hold a Cambodian passport, who co‑founded and ran Myanmar Yatai International Holding Group (YIHG), the Hong Kong–registered company behind the Shwe Kokko “China Town” project. A fugitive from Chinese justice, he had long used aliases like Dylan She, Kailun She, Kriang Kai Tang, Kriang Tang, and Lunkai She and claimed ties to Chinese security services. In reality, he built an extensive gambling and online‑fraud empire on the Thai–Myanmar border. According to news reports, She Zhijiang’s Yatai Company launched the $15‑billion Shwe Kokko resort in 2017 by signing a deal with Saw Chit Thu’s BGF. Officially billed as a luxury development with villas, casinos, and industry, the site rapidly became a vast online “pig butchering” fraud center. YIHG also acquired casino projects in Cambodia and has ties to casinos in Laos. A 2023 investigation noted YIHG had partnered with Chinese state developers on Yatai projects and that She Zhijiang had a 2014 Chinese conviction for illegal gambling abroad.

She Zhijiang’s legal status was resolved in late 2025: he was arrested by Thai authorities in Bangkok in August 2022 on an Interpol warrant and, after a long legal battle, extradited to China on November 10, 2025. Chinese prosecutors accuse him of running large illegal gambling and telecommunications fraud networks that defrauded citizens. She himself has publicly denied wrongdoing, even claiming he was a Chinese spy and targeted for refusing orders by Chinese officials, but Chinese state media say the evidence against him is “conclusive.” In any case, with She detained, the foreign chairman of Yatai is out of the picture. The U.S. and U.K. have sanctioned YIHG and related companies, citing forced labor in its scam centers, and there is no indication that She Zhijiang will resume any active role.

DKBA (Democratic Karen Buddhist Army): Formed in 1994 by Karen rebels who split from the Christian‐led KNU/KNLA, the DKBA then aligned with Myanmar’s military. It later ceded many members to the BGF, now KNA, in 2009. Today, the DKBA remains pro-junta and even coordinates with military forces. DKBA units reinforced Junta troops in battles around Myawaddy in early 2026. Crucially, the DKBA has been implicated in the scam hubs on its home turf. In late 2025, KNLA forces overran a DKBA-run compound in Myawaddy and found it was a “cyber scam center” employing over 5,000 foreign victims. U.S. authorities note that DKBA leaders have been officially sanctioned for providing armed protection to Chinese-run fraud compounds. DKBA officers publicly vowed to eliminate scams from their areas only after international pressure mounted, suggesting they had sheltered those schemes.

KNA (Karen National Army): This is the new name for the former Karen Border Guard Force. The BGF was created in 2010 as a Tatmadaw proxy force under Saw Chit Thu’s command; it supplied border garrisons and collected taxes under military control. In March 2024 (reported), the BGF renamed itself the KNA, ostensibly to appear independent, but it has remained a steadfast ally of the junta. The KNA still dominates eastern Kayin State, which includes the Shwe Kokko area, under Saw Chit Thu. The KNA has been directly implicated in the scam economy: it leases land to fraud syndicates, contracts electricity for call centers, and provides armed security. U.S. Treasury documents explicitly describe Saw Chit Thu (as KNA leader) “entrusting” key tasks to subordinates like Col. Tin Win and Saw Min Min Oo, who run companies that sustain Yatai/Shwe Kokko’s scams. In short, the KNA effectively runs Shwe Kokko: it jointly owns the Yatai venture through Chit Linn Mying (CLM) Co., and KNA officials manage the city’s day-to-day operations. In international media, the KNA is widely described as a military-allied gang profiting from cross-border cybercrime.

KNLA (Karen National Liberation Army): The KNLA is the armed wing of the Karen National Union and has been the principal Karen rebel army since before Myanmar’s independence (founded 1949). It remains deeply opposed to the junta. In the current conflict, the KNLA, along with allied People’s Defense Forces, has clashed repeatedly with both the Myanmar army and junta-aligned militias. Notably, anti-junta Karen forces have attacked scam hubs. In November 2025 the KNLA captured a scam compound in Min Let Pan that was run by the DKBA. The KNLA has publicly positioned itself against cybercrime, assisting foreign victims when it seizes such sites. For example, after overrunning that DKBA compound, KNLA forces began identifying and preparing to repatriate the thousands of scammed workers found inside. Thus, while DKBA and KNA protect the scam centers, the KNLA actively opposes them.

Allies and Foes of the Junta in the Scam Belt: The Shifting Karen Power Map

The junta’s alliances have become fragile and transactional along the Thai–Myanmar border. At the center of this tension is the Tatmadaw’s determination to protect Infantry Battalion 275’s base, a strategically vital base that anchors junta control over the country’s most important trade gateway with Thailand. 

For years, the Tatmadaw relied heavily on the Karen Border Guard Force (BGF) to hold Myawaddy. The BGF, commanded by Saw Chit Thu, acted as the junta’s local enforcer, ensuring that resistance forces were kept at bay and that military supply lines and border trade remained open. In return, the junta largely turned a blind eye to the BGF’s criminal empire, most notably vast scam compounds, casinos, and cross-border illicit businesses that flourished under its protection.

This symbiosis was laid bare in April 2024, when resistance forces led by the Karen National Liberation Army (KNLA) and allied People’s Defense Forces briefly seized Battalion 275. The junta was only able to retake the base and surrounding strategic areas, including sections of the Asia Highway and Thingannyinaung, with decisive help from Saw Chit Thu’s BGF units. That intervention marked a turning point. Saw Chit Thu briefly distanced himself from the regime under the banner of the Karen National Army (KNA), only to realign with the junta later on.

The relationship began to unravel in late 2025, when the junta, under intense international pressure, moved against the scam compounds that had enriched the BGF leadership. The crackdown shattered the unwritten bargain that had sustained the alliance. In response, Saw Chit Thu and allied commanders again adopted the KNA label, signaling an aspiration for greater autonomy, and this served as a warning to Naypyidaw that loyalty was conditional. While some BGF battalions remained aligned with the regime, others drifted into a gray zone, neither openly hostile nor reliably obedient.

It is in this context that the junta has leaned more heavily on other Karen armed actors, notably the Democratic Karen Benevolent Army (DKBA) and the KNU/KNLA‑Peace Council (KNU/KNLA-PC). Both groups have historically cooperated with the military and are now being tasked with protecting junta installations in Myawaddy, including Battalion 275. The regime’s demand that these groups submit troop positions, personnel lists with photographs, and weapons inventories reflects deep mistrust. There is also a distinct fear that today’s allies could become tomorrow’s threats. Meanwhile, the Karen National Union (KNU) and its armed wing, the KNLA, remain firmly in the resistance camp. From the junta’s perspective, they are the principal external threat to its hold on Myawaddy. 

In Myawaddy, alliances are no longer ideological but transactional and unstable. The struggle over scam money, border trade, and military survival has turned former partners into reluctant enforcers and potential adversaries. The Tatmadaw’s warning to Karen armed groups is therefore more than a security measure.

Verification Note: The information in this report has been compiled from multiple credible sources and cross-checked for consistency. Data and reports have been used to corroborate events where possible. While every effort has been made to ensure accuracy, access limitations may prevent independent verification of all details.