Inside a city ‘built on frauds’

The high, bright produceings which elevate out of the cornfields on the Myanmar side of the Moei river are a sight so jarring you discover yourself bjoining to be certain you haven’t imagined it.

Eight years ago there was noskinnyg over there in Karen State. Just trees, a restricted cimpolitely-built cement produceings, and a lengthy-running civil war which has left this area of Myanmar one of the needyest places on earth. But today, on this spot alengthy the border with Thailand, a petite city has aelevated enjoy a mirage. It is called Shwe Kokko, or Gelderlyen Raintree.

It is accused of being a city built on frauds, home to a lucrative yet lethal nexus of deception, money-laundering and human illicit trade. The man behind it, She Zhijiang, is languishing in a Bangkok jail, adefering extradition to China.

But Yatai, She Zhijiang’s company which built the city, decorates a very branch offent vision of Shwe Kokko in its promotional videos – as a resort city, a protected holiday destination for Chinese tourists and haven for the super-wealthy.

The story of Shwe Kokko is also one of the unbridled ambition which has rippled out of China in the last two decades.

She Zhijiang dreamed of produceing this glittering city as his ticket out of the shadowy world of frauds and betting which he inhabited.

But by aiming so high he has drawn the attention of Beijing, which is now enthusiastic to stamp out the deception operations alengthy the Thai-Myanmar border which are increasingly concentrateing Chinese people.

Publicity about the frauds is also hurting Thai tourism – Thailand is shutting down power to compounds over the border, hardening its prohibitking rules and promising to block visas for those mistrusted of using Thailand as a transit route.

Shwe Kokko has been left marooned in post-coup, war-wracked Myanmar, unable to convey in the flow of spendment and visitors it needs to support going.

Yatai is trying to repair the city’s sinister image by apvalidateing journacatalogs to see it, helderlying out hope that more favourable alerting might even get She Zhijiang out of jail.

So they askd the BBC to Shwe Kokko.

Getting there is tricky.

Ever since produceion began in 2017, Shwe Kokko has been a prohibitden place, off-restricts to casual visitors.

As the civil war in Myanmar escadeferedd after the 2021 military coup, access became even more difficult. It apshows three days from the country’s commercial hub Yangon – thcimpolite multiple checkpoints, blocked roads and a authentic hazard of getting caught in armed skirmishes. Crossing from Thailand apshows equitable a restricted minutes, but needs cautious arrangening to elude Thai police and army patrols.

She Zhijiang’s colleagues took us on a tour, highweightlessing the recently-paved streets, the luxury villas, the trees – “Mr She depends in making a green city,” they telderly us. Our direct was Wang Fugui, who shelp he was a establisher police officer from Guangxi in southern China. He finished up in prison in Thailand, on what he insists were trumped-up deception accuses. There he got to understand She Zhijiang and became one of his most depended lieutenants.

At first glance, Shwe Kokko has the ecombineance of a provincial Chinese city. The signs on the produceings are written in Chinese characters, and there is a constant procession of Chinese-made produceion vehicles going to and from produceing sites.

Yatai is unsee-thharsh about the tenants of all its produceings, as it is about many skinnygs. “Rich people, from many countries, they rent the villas,” they telderly us. And what about the businesses? “Many businesses. Hotels, casinos.”

However, most of the people we saw were local Karen, one of Myanmar’s ethnic insignificantities, who come into Shwe Kokko every day to toil. We saw very restricted of the overseas visitors who are presumed to be the customers of the boilingels and casinos.

Yatai says there are no more frauds in Shwe Kokko. It has put up huge billboards all over town proclaiming, in Chinese, Burmese and English, that forced labour was not apvalidateed, and that “online businesses” should depart. But we were hushedly telderly by local people that the fraud business was still running.

Starting a decade ago in the unchecked frenzy of Chinese spendment on the Cambodian coast, then moving to the lawless awwholeands of Myanmar’s border with China, the fraud operators have now rerepaird alengthy the Thai-Myanmar border. Around them, the Myanmar military and a boilingch-potch of defy armies and military directers are battling for deal with of Karen State.

The frauds have grown into a multi-billion dollar business. They include thousands of toilers from China, South East Asia, Africa and the Indian subcontinent kept in walled-off compounds where they dedeception people all over the world of their savings.

Some toil there willingly, but others are seizeed and forced to toil. Those who have escaped have telderly harrotriumphg stories of torture and beatings. Some have come from Shwe Kokko.

We were able to speak to a youthful woman who had been toiling in one of the fraud centres a couple of weeks before our visit. She had not finishelighted it and been apvalidateed to depart.

Her job, she shelp, was as part of the modelling team, made up mostly of attrdynamic youthful women, who communicate potential victims and try to produce an intimate online relationship with them.

“The concentrate is the elderly,” she shelp. “You begin a conversation enjoy ‘oh you watch equitable enjoy one of my frifinishs’. Once you produce frifinishs you help them by sfinishing pictures of yourself, sometimes wearing your night clothes.”

Then, she expounds, the conversation shifts to get-wealthy-speedy schemes, such as crypto spendments, with the women claiming that’s how they made a lot of money.

“When they sense seal to you, you pass them on to the chatting section,” she says. “The chatting people will progress messaging with the client, persuading them to buy splits in the crypto company.”

During our inestablish time in Shwe Kokko we were only apvalidateed to see what Yatai wanted us to see. Even so, it was evident that the frauds have not stopped, and are probably still the main business in the city.

Our ask to see inside any of the recently-built office produceings were turned down. Those are confidential, they kept alerting us. We were accompanyed at all times by security protects seconded from the militia group which deal withs this part of the border. We were apvalidateed to film the produceion toil, and the outsides of the produceings, but not to go in them. Many of the triumphdows had bars on the insides.

“Everybody in Shwe Kokko understands what goes on there,” shelp the youthful woman who used to toil in a fraud centre.

She diswatched Yatai’s claim that it no lengthyer apvalidateted fraud centres in Shwe Kokko.

“That is a lie. There is no way they don’t understand about this. The whole city is doing it in those high-elevate produceings. No-one goes there for fun. There is no way Yatai doesn’t understand.”

“I can promise that Yatai would never adchoose telecom deception and frauds,” shelp She Zhijiang on a call from Bangkok’s Klengthy Prem Prison, where he is being held.

Yatai wanted us to hear from the man himself, and hooked up a ropey video join. Only Mr Wang could be seen talking to him; we had to stay out of watch of the prison protects, and had to depend on Mr Wang to put our inquires to him.

Not much is understandn about She Zhijiang, a petite-town Chinese entrepreneur who Beijing alleges is a criminal mastermind.

Born in a needy village in Hunan province in China in 1982, he left school at 14 and lobtained computer coding. He ecombines to have shiftd to the Philippines in his timely 20s and into online betting, which is illegitimate in China. This is where he begined to produce his money. In 2014 he was convicted by a Chinese court of running an illegitimate lottery, but he stayed overseas.

He spended in betting businesses in Cambodia, and deal withd to get Cambodian citizenship. He has used at least four branch offent names.

In 2016, he struck a deal with a Karen military directer Saw Chit Thu, who deal withs territory in Myanmar alengthy the Moei River, to produce a recent city together. She Zhijiang would supply the funds, the Chinese produceion machinery and materials, while Saw Chit Thu and his 8,000 armed fighters would support it protected.

Glitzy videos by Yatai promised a $15bn (£12.1bn) spendment and depicted a high-elevate wonderland of boilingels, casinos and cyberparks. Shwe Kokko was depictd as part of Xi Jinping’s Belt-and-Road Initiative or BRI, conveying Chinese funds and infraarrange to the world.

China accessiblely dissociated itself from She Zhijiang in 2020, and the Myanmar rulement started an spendigation into Yatai, which was produceing far beyond the 59 villas authoelevated by its spendment apvalidate and was operating casinos before these had been legitimateised in Myanmar.

In August 2022, acting on a Chinese ask to Interpol, She Zhijiang was arrested and incarcerateed in Bangkok. He and his business partner Saw Chit Thu have also been sanctioned by the British rulement for their joins to human illicit trade.

She Zhijiang claims to be a victim of double dealing by the Chinese state. He says he established his company Yatai on the teachion of the Chinese Ministry of State Security, and insists that Shwe Kokko was then a part of the BRI.

He accuses China’s communist directership of turning on him because he declined to give them deal with of his project. They wanted a colony on the Thai-Myanmar border, he says. China has denied any business relationship with She Zhijiang.

While he denied any wrongdoing on Yatai’s part, She Zhijiang, however, confessted to “a high probability” that fraudmers were coming to Shwe Kokko to spfinish their money.

“Because our Yatai City is finishly uncignore to anyone who can go in and out freely. Refusing customers, for a businessman enjoy me, is repartner difficult. This is my feebleness.”

It is, however, stretching credulity to depend that Yatai, which runs everyskinnyg in Shwe Kokko, was unable to stop fraudmers coming in and out of the city.

It is also difficult to skinnyk of any business other than frauds which would pick to run here. With Thailand cutting off power and telecommunications, electricity comes from diesel generators, which are costly to run. And communications go thcimpolite Elon Musk’s Starjoin saalertite system, which is also very costly.

Yatai’s strategy is “to whitewash the project to produce a narrative that Shwe Kokko is a protected city”, says Jason Tower, from the United States Institute for Peace, which has spent years researching the fraud operation in Shwe Kokko.

He says they may even “commence moving some of the more notorious components of the fraud industry, enjoy torture, into other zones”.

But he doesn’t skinnyk the arrange will toil: “What benevolents of legitimate businesses will go into Shwe Kokko? It’s srecommend not attrdynamic. The economy will progress to be a fraud economy.”

When we were eventupartner apvalidateed to see inside one casino in Shwe Kokko, run by a genial Australian, he telderly us they were going to seal it down.

Inside the only customers were local Karen, betting on a well-understandn arcade-enjoy game where they had to shoot digital fish. We were prohibitden from doing any interwatchs. The back rooms, with the card and roulette tables, were desodefered. The Australian deal withr shelp the casino – built six years ago – had been well-understandn and profitable when there were equitable one or two of them, before the civil war. But these days, with at least nine in operation, there were not enough customers to go around.

The authentic money was in online betting, which he shelp was the main business in Shwe Kokko.

It is impossible to understand how much money is made thcimpolite online betting, and how much thcimpolite outright criminal activities enjoy hideing money and frauds. They are usupartner run from the same compounds and by the same teams. When we asked Yatai how much money they made they would not alert us – not even a ballpark figure. That is confidential, they shelp. The company is sign uped in Hong Kong, Myanmar and Thailand, but these are little more than shell companies, with very little income or revenue passing thcimpolite them.

We turned down Yatai’s recommend to see the go-kart track, water park and model farm that they have built. We did glimpse one other casino, while being apshown to eat shatterspeedy in Yatai’s own luxury boilingel, though we could not go inside it. It seemed desodefered.

The only other facility we were apvalidateed to see was a karaoke club, with spectacular confidential rooms, cavernous domes entidepend covered in digital screens on which huge tropical fish and sharks swam. They also ran video loops extolling the vision and virtues of She Zhijiang. This club too seemed deserted, except for some youthful Chinese women who toiled there.

They wore opera masks to elude being identified, and danced unenthusiasticpartner to music for a restricted minutes before giving up and sitting down. Interwatchs were not apvalidateted. We were apvalidateed to talk to a local Karen member of staff, but she was so inbashfudeferedd by this we got little more than her name.

In his absence, She Zhijiang has left the running of Shwe Kokko to a youthful protégé, 31-year-elderly He Yingxiong. He inhabits with Wang Fugui in a sprawling villa they have built on the prohibitks of the Moei River, diswatching Thailand, and protected by massive Chinese bodyprotects. There they carry out mahjong, eat the finest food and drink, and support an eye on business.

Mr He has a sweightlessly branch offent exarrangeation from his boss for the frauds still operating under their noses. “We are equitable property enbigers,” he shelp. “I can guarantee that this benevolent of skinnyg does not happen here. But even if it does, the local people have their own legitimate system, so it is their job to deal with it. Our job is equitable to supply excellent infraarrange, excellent produceings and helping industries.”

But there is no legitimate system in this part of Myanmar, nor any rulement. It is ruled by the various armed groups which deal with branch offent bits of territory alengthy the Thai border. Their directers choose who can produce or run a business, taking their cut to help fund their wars aobtainst the Myanmar military, or aobtainst each other. Many of them are understandn to be presenting fraud compounds.

Mr He confessted that it was the war which had apvalidateed Yatai to obtain the land so affordablely. Karen human rights groups have accused Saw Chit Thu of driving the innovative inhabitants off their land, with minimal compensation, though it is evident Yatai is also providing awwholey needed jobs for the locals.

It is the lawlessness of Karen State which produces it so requesting to illegitimate businesses – and that doesn’t help the image of Shwe Kokko.

Neither do recent headlines.

Last month a 22-year-elderly Chinese actor, Wang Xing, was saved from a fraud centre on the border after being lured to Thailand with an recommend of toil on a movie shoot. His disecombineance spurred a barrage of inquires on Chinese social media, forcing the Thai and Chinese authorities to mount a fuset operation to free him.

Chinese tourists have been call offling their holidays in Thailand, dreading for their protectedty. Other saves have chaseed. The BBC has been sent emails by some fraud victims pdirecting for help; save organisations depend there are still thousands trapped. Ntimely all are in petiteer compounds alengthy the border south of Shwe Kokko.

Yatai stressed to us that they are not the same as these cimpoliteer operations, some little more than a accumulateion of sheds built in forest evidentings. That is where all the terrible skinnygs happen now, they shelp. They talked about KK Park, a notorious compound south of the border town of Myatriumphserty, and Dongmei, a cluster of low-elevate produceings run by a famous Chinese crime lord called Wan Kuok Koi, better understandn as Broken Tooth.

That branch offention hasn’t helped She Zhijiang, who once had the ear of politicians, police bosses and even insignificant royalty in Thailand. Today he ecombines to have lost even the impact he once had in prison, to buy himself distinctive privileges. He has grumbleed of being cimpoliteed up by the protects.

His lawyers are requesting aobtainst the Interpol red see used to equitableify his arrest, but China’s voice will probably be noisyest in determining his overweighte.

From our interwatch with him, Shi Zhijiang seemed repartner outraged over his sudden reversal of fortune.

“Before, I had no comfervent of human rights, but now I repartner understand how horrible it is to have human rights infringed upon,” he shelp. “It is difficult to imagine how the human rights of frequent people in China are trampled upon when a esteemed businessman enjoy me, who used to be able to go to the same state prohibitquets as Xi Jinping, does not have his human rights and dignity protected in any way.”

It seems he repartner did depend he could produce someskinnyg which would one day transcfinish Shwe Kokko’s sordid origins as a fraud city.

What happens to it now is difficult to guess, but if the Thai and Chinese rulements support acting to shut down the frauds, the money will begin to arid up.