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11 Feb 2025 17:33
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  •   Home > News > International

    Trafficking and crime will rise after US foreign aid freeze, experts say

    The US foreign aid freeze could lead to more people being trafficked into online fraud compounds in Asia and more Americans and Australians being scammed, experts say.


    Abdus Salam was enticed to move to Cambodia by the promise of a $US1,000 ($1,592) monthly salary as a computer operator. 

    But after the textiles engineer from Bangladesh arrived in the capital Phnom Penh he was driven by a broker to Dara Sakor, a remote area 270 kilometres away, and trafficked into a cyber scam compound.

    "I thought it would be the golden ticket to support my family," he recalled. 

    "When I arrived, I realised I had no way out."

    Confined within a heavily guarded compound, Mr Salam was forced to establish relationships with victims on social media and convince them to invest in fraudulent cryptocurrency investments. 

    Mr Salam was sold three times to different compound owners. 

    "They beat people with baseball bats, gave electric shocks — there was no escape and they had my passport," he said.

    Eventually with the assistance of the Global Anti-Scam Organisation he was rescued and returned to Bangladesh.

    He now works with Humanity Research Consultancy as a survivor empowerment and communication officer assisting others to escape human trafficking.

    "Through my lived experience, I contribute intelligence to law enforcement and support other survivors," he said.

    "I know what's at stake."

    According to the UN Human Rights Office hundreds of thousands of people are trafficked every year into online criminality each year in South-East Asia — from romance-investment scams to crypto fraud.

    However, Mr Salam's projects with USAID-funded partners across the region have been put on hold following US President Donald Trump's executive order to freeze all foreign assistance funding for 90 days to assess whether it aligns with an "America first" policy. 

    Survivor-led workshops he has been involved in are now in jeopardy, as well as research projects focused on targeting trafficking brokers and gathering evidence for legal cases.

    Myanmar, Cambodia, and Laos are major hotspots for online scam operations, where victims are often trafficked through Thailand via false recruitment schemes.

    "The crime rate will go up," Mr Salam said. 

    "It will increase because if these stakeholders stop their work combating this human trafficking and forced labour into slavery, a massive void will be left."

    Trafficking networks expanding

    "This is a win for traffickers," said Michael Brosowski, founder of Blue Dragon, a Vietnam-based NGO that assists in rescuing human trafficking victims.

    "We were mid-cycle in our funding grant, and now we can't access it ... We're scrambling to figure out which parts of our work we'll have to cut — and which staff we may have to let go," he told the ABC.

    Mr Brosowski said criminal groups had evolved beyond traditional smuggling routes out of Vietnam. 

    Instead of trafficking women into forced marriages or labour in Chinese factories, victims are now lured through social media into scam operations in Thailand and Myanmar.

    "These traffickers don't have to lure victims one-by-one anymore," Mr Brosowski said. 

    "They can do their business at a scale like never before, working on 20 people at once online, making their operations on various social channels harder to detect."

    To counter this problem, Blue Dragon developed a new approach in recent years, training and building grassroots systems to stop trafficking before it starts. 

    One key initiative is the anti-trafficking boards, local groups of teachers, police officers, and community leaders who identify and protect at-risk individuals. 

    But now these efforts face uncertainty.

    The snowball effect of an aid freeze

    Freedom Collective is a network of NGOs that work to combat human trafficking and slavery.

    The organisation's CEO, Julia Macher, said 85 per cent of her budget had disappeared due to the USAID funding freeze.

    "The biggest impact is on our ability to respond to trafficking linked to scam centres," she said. 

    "We've been coordinating [rescue] groups, but since the crisis started, raising funds has been nearly impossible."

    While awareness of the issue has grown, Ms Macher emphasised that attention alone doesn't fund operations. 

    "In Cambodia, where fundraising is dangerous, USAID support was critical — not just for rescues, but for financial investigations and private-sector collaborations aimed at dismantling these criminal networks.

    "If there's no money for survivors, no funds for support, not even flights [for survivors] — who's going to do the detection?

    "Without resources, the entire anti-trafficking system risks collapse. These scams are running at an industrial scale. If we don't act, we won't even understand the problem as it evolves, let alone stop it," she added.

    She also underscored the dangers of working in authoritarian environments, where misinformation runs rampant. 

    "In places like Cambodia, where you can't trust what the government is saying, independent verification is crucial," Ms Macher said.

    "Without funding, we lose our ability to check what's actually true."

    In Myanmar, the Chin Human Rights Organisation's director Salai Za Uk Ling said 30 per cent of their funding was affected by the freeze, leading to staff lay-offs and reduced activities inside Myanmar.

    "Our ability to document human rights violations such as abuses of displaced people will be reduced, and therefore perpetrators get away with more impunity," he said.

    He warned that dynamics continue to change in Myanmar's conflict and their on the ground investigations would be impacted.

    "More people displaced by aerial attacks, try to search for safety and may take the risk to go to another country, entrusting their lives to traffickers."

    A 'security threat' beyond Asia, targeting the US and Australia

    Many of the victims targeted by scammers in these compounds are in Australia and the US.

    Australians lost $2.7 billion to scams in 2023 according to the Australian Competition and Consumer Commission. Figures for 2024 are not yet available. 

    Asian transnational crime expert Jacob Sims said that trafficking into scamming compounds was "the fastest-growing form of organised crime globally".

    "It isn't merely a regional crisis … it is a growing US national security crisis," he said.

    Billionaire Elon Musk, the head of Mr Trump's new Department of Government Efficiency, or DOGE, said on X that USAID "has been run by a bunch of radical lunatics".

    "We're getting them out, and then we'll make a decision [about its future]," Mr Musk said.

    Conspiracy theories about US foreign aid spread from the White House puts US nationals and international aid workers in harm's way, experts warned.

    "When you see the relationship between DC and the embassy start to visibly erode, you're going to start to see hostile and outright criminal regimes start to test the waters,"  Mr Sims said.

    Ms Macher dismissed the notion that NGOs can simply "diversify" their funding sources.

    "I'm tired of hearing that advice," she said.

    "It's clearly impossible to diversify when there is no support available and you are in a place where publicly sharing what you do puts you at risk."


    ABC




    © 2025 ABC Australian Broadcasting Corporation. All rights reserved

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