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How gray industry technology promotes fraud in Southeast Asia

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The fraud industry in Southeast Asia has developed into a sophisticated operation that uses modern technology to defraud victims on a large scale. A significant part of this success is the use of grey market technology – tools and equipment sourced through unofficial or illegal channels that present legal and regulatory loopholes. Third-party advertising services provided by contractors, particularly from China and Malaysia. These enablers provide fraudsters with the tools, platforms and strategies to defraud victims in unprecedented ways, creating a shadow economy that is difficult to dismantle and lucrative. These technologies provide fraudsters with the means to operate effectively, making them more difficult to track and investigate. Criminal networks have adopted advanced technologies such as malware, artificial intelligence (AI) and deep fakes to increase the sophistication and reach of their fraud.

A well-known example is the “pig killing” scam, where victims are deceived into investing in fake cryptocurrency schemes. Platforms such as Cambodia-based Huiwang Guarantee have been identified as being at the heart of this ecosystem, facilitating services for scammers, including target acquisition, money laundering, and human trafficking channels . The financial impact of these scams is staggering. Online fraudsters in Southeast Asia are expected to steal up to $ 37 billion in 2023 , with AI-driven crime playing a major role in this surge. The integration of advanced technologies is making these scams more convincing and harder to detect, posing a huge challenge for law enforcement agencies.

Efforts to combat these illegal activities are ongoing. For example, Laos has begun to crack down on online fraud within its borders, specifically targeting the Golden Triangle Special Economic Zone, which is notorious for being home to many fraud centers. Authorities have ordered the closure of these so-called parks in response to international pressure and adverse impacts on regional security.

What is the gray industry (technology)?


Grey market technology refers to hardware, software, and digital tools obtained outside of authorized distribution channels. Unlike black market goods, these items are often manufactured legally but sold or repurposed in a way that circumvents regulations, licensing, or official oversight. In the fraud industry, grey market technology includes counterfeit devices, unauthorized software, and untraceable communications tools. While this technology is not inherently illegal, it is often exploited by criminal enterprises due to its low price and lack of regulation. In Southeast Asia, grey market technology is the cornerstone of everything from phishing schemes to crypto scams .

How do fraud groups use the gray industry chain to commit fraud?


Untraceable communication tools


  • Internet Phone 'System': Voice over IP technology allows scammers to mimic phone numbers from different regions or countries, making the victim's operations appear legitimate.

  • SIM 'cloning': Fraudsters use grey market SIM cards or cloning devices to manipulate phone numbers for fraudulent activities.

  • Encrypted messaging 'apps': Grey market versions of popular apps offer enhanced anonymity, making it harder for authorities to intercept communications.


  • Scam and Phishing Tools


  • Caller ID 'spoofers': Scammers use these devices to impersonate trusted organizations, such as banks or government agencies.

  • Phishing 'kits': Prepackaged software from the gray market that allows scammers to create fake websites or emails to steal sensitive information.

  • Fake domain name 'registration': Grey market platforms can create domain names that closely mimic legitimate websites, tricking victims into revealing personal details.


  • Digital Payment and Money Laundering Solutions


  • Cryptocurrency 'wallets': No KYC (real name authentication) required Gray market wallets are used to launder stolen funds.

  • Payment 'Gateways': Unauthorized or compromised payment systems facilitate the movement of illicit funds across borders.

  • Hardware exploit 'devices': Gray market smartphones and laptops with pre-installed malware used to collect data.

  • ATM 'skimmers': Devices purchased through the gray industry can help fraudsters steal card information from ATMs .

  • Spy 'gadgets': Tools such as hidden cameras and keyloggers are widely used to collect sensitive information.

  • Artificial Intelligence and Automation

  • 'Chatbots': Artificial intelligence-driven robots that mimic human behavior and automate scams such as customer service scams or investment schemes.

  • Deepfake 'technology': Grey industry AI tools create realistic audio or video imitations to convince victims to transfer funds or reveal private details.


  • Why grey industry technology is booming in Southeast Asia


  • 'Affordability': Many of these tools are much cheaper than legitimate ones, which makes them accessible to scammers.

  • Regulatory 'gaps': Weak enforcement of technology import and export regulations allows grey market goods to flow freely into the region.

  • High 'Demand': The increasing sophistication of fraud operations is fueling demand for advanced tools that are easily available on the grey market.

  • 'Anonymity': Grey market platforms prioritize user privacy, allowing buyers to purchase tools without revealing their identity.

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    The above screenshots were found on Instagram , where advertising companies openly use the platform to promote scams related to services such as human resources, gambling, investments, loans, e-commerce scams, etc.

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    Another screenshot advertises a service that directs customers to a scam center, directing them to a fake investment group chat platform. The screenshot on the far right features the term " grey industry contractor . "

    While legitimate advertising agencies and contractors work within ethical and legal boundaries, there exists a murky area known as the "grey market" that operates in a legally murky space. One of the most concerning trends in this grey market is the emergence of advertising contractors who promote scammy or deceptive services, often leading clients into scams or unethical business practices .

    Strategies used by grey industry advertising contractors


    Gray market advertising contractors rely on a variety of strategies to promote their services and reach their target 'audience':
  • 1. Manipulative social media 'campaigns': Platforms such as Instagram , Facebook and TikTok are often used to promote scams. These contractors create fake accounts or use influencers to promote fraudulent services such as "too good to be True" investment schemes, job opportunities or promises of getting rich quick. The goal is to attract attention and increase traffic to the scam website or group chat.

  • 2. Fake investment 'groups': A common scam is to promote fake investment group chats. Contractors lure individuals into these chat groups by promising insider trading tips, exclusive investment opportunities, or high returns. Once inside, the scammers either ask for funds for " consulting " or proceed to manipulate the individual into handing over more cash for non-existent services.

  • 3. Gray market contractors for unlicensed 'services': Some gray market contractors promote services such as unlicensed loans, gambling platforms, and other illegal or heavily regulated activities. By advertising these services as legitimate opportunities, these contractors can trick users into participating.

  • 4. Deceptive 'Advertising': Gray market advertising often relies on "bait and switch" advertising. Contractors will create ads that appear to promote legitimate products or services, but actually just redirect users to completely different or harmful websites. These ads may promise lucrative job opportunities or opportunities to get rich quick, but ultimately result in scams.

  • 5. Gray market contractors for unlicensed 'services': Some gray market contractors promote services such as unlicensed loans, gambling platforms, and other illegal or heavily regulated activities. By advertising these services as legitimate opportunities, these contractors can trick users into participating.


  • Gray market advertising contractors are a significant problem in the digital landscape, especially as online scams continue to proliferate. While these contractors appear to be operating within the legal realm, their activities often cause real harm to consumers and businesses. As the world of digital advertising continues to evolve, platform providers, regulators, and consumers must remain vigilant and proactive in identifying and combating gray market advertising contractors. Only by working together can we create a safer, more trustworthy online environment for everyone.