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

  • Virus tops 84 with new cases in S’ville

    The Ministry of Health on Sunday night confirmed another 31 cases of coronavirus infections, bringing the Kingdom’s total to 84 and it highest daily tally. There have been no fatalities thus far. The latest cases were found in 29 French tourists and their two Cambodian tour guides

  • Kingdom’s virus toll tops 84, Cambodians in Thailand rush home

    The Ministry of Health on Sunday night confirmed another 31 cases of coronavirus infections, bringing the Kingdom’s total to 84 and its highest daily tally. There have been no fatalities thus far. The latest cases were found in 29 French tourists and their two Cambodian tour guides

  • NBC calls for cashless payments

    The National Bank of Cambodia (NBC) has urged government ministries, financial institutions and the public to conduct cashless payments via electronic systems where possible to combat the spread of Covid-19. “To contribute to the prevention of Covid-19, the National Bank of Cambodia encourages financial institutions

  • Mysterious century-old structure found at bottom of Angkor pond

    The Apsara National Authority (ANA) has discovered a mysterious 1,000-year-old structure of a wooden building at the bottom of a pond after the Angkor Wat temple’s conservation team completed restoring its northern cave. The deputy director at ANA’s Angkor International Research and Documentation

  • CEO held for fraud in Siem Reap

    Over 200 individuals gathered in front of the Siem Reap Provincial Court last week to ask that Dim Suonnath, the CEO of a real estate company being held for fraud, take responsibility for compensating some 2,000 residents who invested with him. The request was denied. Suonnath responded

  • Ministry calls for home schooling

    Minister of Education, Youth and Sport, Hang Chuon Naron appealed to parents of students to provide home education in a proper environment and help them obtain more learning materials. The ministry also allowed schools to take a premature vacation after several people tested positive for