Logo of Phnom Penh Post newspaper Phnom Penh Post - Chinese leave Sihanoukville en masse following bust

Chinese leave Sihanoukville en masse following bust

A Chinese national is escorted to a plane by a Chinese immigration official earlier this month after he was detained for his alleged involvement in an online extortion ring in Cambodia.
A Chinese national is escorted to a plane by a Chinese immigration official earlier this month after he was detained for his alleged involvement in an online extortion ring in Cambodia. General Department of Immigration

Chinese leave Sihanoukville en masse following bust

Hotel and casino owners in Sihanoukville claim they have suffered immense losses and risk bankruptcy after Chinese investors, workers and tourists left the coastal city en masse following last month’s police arrest and extradition of 168 Chinese nationals accused of operating a transnational telecom extortion ring from the coastal city.

On October 31, Cambodian immigration police working with Chinese Interpol agents raided a villa and a guesthouse in Sihanoukville, arresting 168 Chinese nationals accused of using an internet-based telephone system to extort money from victims back in China.

The suspects were swiftly extradited on charter flights to China as part of a wider crackdown in Cambodia and Indonesia that netted 254 suspects involved in over 4,000 cases of telephone fraud.

Many of those arrested in the Cambodian raids were working in casinos in Sihanoukville, which has fuelled rumours that the arrests were aimed at shutting down the overseas gaming halls and online casinos that mainland Chinese nationals frequent to circumvent Mainland China’s ban on gambling.

Ly Koung, owner of the Majestic Hotel, a newly opened hotel and casino on Victory Hill, said his casino’s Chinese staff and customers abruptly fled the coastal city after the raids fearing they would be arbitrarily targeted in the next inter-agency police sweep.

“We have no more customers, and our workers have quit,” said Koung, adding that he had to suspend casino operations after racking up $20,000 in losses.

“Arresting Chinese nationals who work in casinos without any clear evidence made our Chinese staff fearful and many resigned, which forced us to close the casino,” he explained.

“If those arrested are found guilty, we support this police action, but if they are in fact innocent then these arrests have [irresponsibly] incited fear.”

Sihanoukville hotel and casino operators met with the provincial governor and local authorities on Friday to press for more clarity about the police crackdown, and to demand evidence to support the allegation that the deported Chinese nationals were part of a Chinese online crime syndicate.

Rattanak Sambath, owner of the Royal Union Hotel and Casino, which employs Chinese nationals and caters primarily to Chinese tourists, said the police action was a death knell to his business.

While he did not specify his losses, his assistant Mean Vannak confirmed to the Post that the hotel and casino lost about $100,000 following the October 31 police crackdown and had ceased operations.

Sambath said the hotel’s casino employed 79 of the Chinese nationals arrested in the crackdown, but denied they had conducted any illicit activities while working in the casino. He said police, who confiscated VoIP equipment when they arrested the suspects at a villa and guesthouse, had not provided any evidence of wrongdoing.

“We don’t know what they are being accused of,” he said. “But [as a result,] the Chinese are leaving Sihanoukville.”

According to Sambath, there were between 4,000 and 5,000 Chinese living in Sihanoukville before the arrests. Now less than 400 remain.

Sihanoukville’s Chinese expat community had grown in recent years on the back of a growing gaming sector, with casinos – and particularly live-dealer online casinos – requiring Chinese workers to interact with Mainland Chinese gamblers. Sambath said the departure of the Chinese would have a broad economic fallout on the coastal city’s economy.

“They [Chinese residents] are the bridge to bring investors to Cambodia in the hotel, restaurant and property sectors”, he said. “They also spend a lot of money in Sihanoukville every day.”

Aharon Gini, general manager of the Queenco Hotel and Casino, expressed similar sentiment, arguing that much of Sihanoukville’s long-term investments and development is backed by Chinese investors and dependent on Chinese customers.

“All of Sihanoukville’s economy is built off of around 5,000 Chinese people living here,” he said.

“If the Chinese cut off their contracts, the hotels are left with big projects and no option to get income.”

Gini said Queenco lost a potential $1 million contract when the Chinese online gambling company it had planned to rent its hotel to got spooked by last month’s crackdown and failed to show up for the contract signing.

He said the hotel’s Israeli parent company, Queenco Leisure International, had invested $60 million in Cambodia since 2007 and stood little chance of seeing a return on its investment if the situation in Sihanoukville was not rectified.

“The basic income we need is gone,” Gini said.

“I think that [authorities] will solve the problem and give support to the companies, but the surprise over how they acted made things a little bit uncertain for the Chinese.”

During Friday’s meeting, Sihanoukville police chief Brigadier General Choun Narin said he could not provide any details on the October 31 raids as they were conducted by Interior Ministry and immigration department officials, and local police had not been consulted beforehand.

“I cannot elaborate on what kind of crimes the suspects are accused of or how many are guilty,” he said.

“We did not lead the operation and we did not know about it until it was already underway.”

Gini said following a closed-door session that government officials offered to create an ad hoc committee to monitor all aspects of online gaming and develop more rigid laws concerning online activities.

A previous version of this article incorrectly named Rattanak Sambath as the owner of the Golden Royal Hotel and Casino. The Post apologises for any inconvenience this has caused.

MOST VIEWED

  • Would you like fries with that? US burger chain makes Phnom Penh debut

    California-based The Habit Burger Grill restaurant chain is all set to serve up a delicious array of charbroiled burgers and sides at its newest international location in the centre of Phnom Penh. The Habit is “renowned for its award-winning Charburgers grilled over an open flame,

  • Banteay Meanchey flood victims receive aid

    Prime Minister Hun Sen on Wednesday provided aid to more than 10,000 families affected by flooding in Banteay Meanchey province’s Mongkol Borei district and offered his condolences to the 18 victims who drowned in the province over the past week. He said flooding had occured in

  • Angkor provides ‘valuable’ water storage

    The Apsara National Authority (ANA) has stored millions of cubic metres of water at reservoirs in the Angkor area after Cambodia experienced a series of rainstorms over the last few days. The storing of the water, besides serving temple conservation, will also be used to

  • PM urges caution as Polish man tests positive for Covid

    The Ministry of Health on Wednesday reported that a 47-year-old Polish man tested positive for Covid-19 after arriving in Cambodia on Monday. There are a total of six Covid-19 patients currently in the country, all of whom are being treated at the Khmer-Soviet Friendship Hospital

  • Banteay Meanchey floods kill one more as death toll reaches 15

    As floodwaters start to recede in Pursat, Battambang and Pailin provinces and Phnom Penh, Banteay Meanchey continues to bear the brunt as one more person was killed on Monday, bringing the total number of flood-related deaths to 15 in the province this month. Banteay Meanchey provincial

  • Serving coffee with a side of robots

    The eye-catching glass building surrounded by greenery at the intersection of Streets 371 and 2002 in Phnom Penh’s Sen Sok district is more than just another coffee shop where you can while away a few hours. UrHobby House cafe is filled with robots and characters from