US warns companies of engaging in Cambodia’s casino, finance and construction sectors

(De)constructing Sihanoukville – a photoblog
Casino construction in Sihanoukville © Arno Maierbrugger

US state authorities have warned US companies either operating in Cambodia or considering doing so against interactions with “certain entities and sectors of concern,” including the casino industry, Macau-based special interest magazine Inside Asia Gaming wrote in a report published on November 11.

The US Department of State, the US Department of the Treasury and the US Department of Commerce have issued a joint statement highlighting risk exposure for US companies when dealing with Cambodian entities not only active in the casino industry, but also in the financial, real estate and infrastructure sectors which it classifies as “industries of concern” in terms of Illicit finance activities and trafficking of people, wildlife and narcotics, as well as child labour.

In a section dedicated to casinos – particularly those located in Sihanoukville –, the statement points to a 263-per cent increase in casino licenses issued in Cambodia between 2014 and 2019 as having “outpaced regulators’ capacity to monitor and police these establishments, attracting organised crime elements that invest in casinos and use them to launder money.”

Lax regulations by Cambodia’s government

The statement further notes that while the Cambodian government has set up an inter-ministerial task force to investigate alleged money laundering and human trafficking in Sihanoukville, the body has not yet issued a report on its findings as of October 2021.

Other red flags for US companies are “limited financial regulations and oversight of financial transactions,” as well as “endemic and widespread corruption,” the note said.

Rampant development of new casinos in Sihanoukville has further raised concerns of child labour and trafficking, the statement goes on, adding that while Cambodia’s 2020 ban on online gambling and the subsequent closure of many casinos and other entertainment establishments have temporarily reduced such trafficking, the problem would persist and likely grow as the Cambodian economy recovers from the Covid-19 pandemic, bringing with it an increase in the number of child labourers at construction sites and venues including casinos, hotels and karaoke bars.

“The [Cambodian] government lacks the capacity to deal with child labour and is overwhelmed by the scale of the issue,” the statement said.

Triad leaders and North Korean arms traders

Among specific companies of concerns, the statement singled out those related to former Macau triad leader Wan Kuok Koi and North Korean official Kim Chol Sok, the country’s former ambassador to Myanmar where he was alleged by the US of arms trading.



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[caption id="attachment_31787" align="alignleft" width="300"] Casino construction in Sihanoukville © Arno Maierbrugger[/caption] US state authorities have warned US companies either operating in Cambodia or considering doing so against interactions with “certain entities and sectors of concern,” including the casino industry, Macau-based special interest magazine Inside Asia Gaming wrote in a report published on November 11. The US Department of State, the US Department of the Treasury and the US Department of Commerce have issued a joint statement highlighting risk exposure for US companies when dealing with Cambodian entities not only active in the casino industry, but also in the financial, real...

(De)constructing Sihanoukville – a photoblog
Casino construction in Sihanoukville © Arno Maierbrugger

US state authorities have warned US companies either operating in Cambodia or considering doing so against interactions with “certain entities and sectors of concern,” including the casino industry, Macau-based special interest magazine Inside Asia Gaming wrote in a report published on November 11.

The US Department of State, the US Department of the Treasury and the US Department of Commerce have issued a joint statement highlighting risk exposure for US companies when dealing with Cambodian entities not only active in the casino industry, but also in the financial, real estate and infrastructure sectors which it classifies as “industries of concern” in terms of Illicit finance activities and trafficking of people, wildlife and narcotics, as well as child labour.

In a section dedicated to casinos – particularly those located in Sihanoukville –, the statement points to a 263-per cent increase in casino licenses issued in Cambodia between 2014 and 2019 as having “outpaced regulators’ capacity to monitor and police these establishments, attracting organised crime elements that invest in casinos and use them to launder money.”

Lax regulations by Cambodia’s government

The statement further notes that while the Cambodian government has set up an inter-ministerial task force to investigate alleged money laundering and human trafficking in Sihanoukville, the body has not yet issued a report on its findings as of October 2021.

Other red flags for US companies are “limited financial regulations and oversight of financial transactions,” as well as “endemic and widespread corruption,” the note said.

Rampant development of new casinos in Sihanoukville has further raised concerns of child labour and trafficking, the statement goes on, adding that while Cambodia’s 2020 ban on online gambling and the subsequent closure of many casinos and other entertainment establishments have temporarily reduced such trafficking, the problem would persist and likely grow as the Cambodian economy recovers from the Covid-19 pandemic, bringing with it an increase in the number of child labourers at construction sites and venues including casinos, hotels and karaoke bars.

“The [Cambodian] government lacks the capacity to deal with child labour and is overwhelmed by the scale of the issue,” the statement said.

Triad leaders and North Korean arms traders

Among specific companies of concerns, the statement singled out those related to former Macau triad leader Wan Kuok Koi and North Korean official Kim Chol Sok, the country’s former ambassador to Myanmar where he was alleged by the US of arms trading.



Support ASEAN news

Investvine has been a consistent voice in ASEAN news for more than a decade. From breaking news to exclusive interviews with key ASEAN leaders, we have brought you factual and engaging reports – the stories that matter, free of charge.

Like many news organisations, we are striving to survive in an age of reduced advertising and biased journalism. Our mission is to rise above today’s challenges and chart tomorrow’s world with clear, dependable reporting.

Support us now with a donation of your choosing. Your contribution will help us shine a light on important ASEAN stories, reach more people and lift the manifold voices of this dynamic, influential region.

 

 

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