U.S. Imposes Sanctions on Cambodian Tycoon Linked to Human Trafficking and Crypto Fraud

The U.S. Department of the Treasury has imposed sanctions on Cambodian businessman Ly Yong Phat and his businesses, including his conglomerate L.Y.P. Group and the O-Smach Resort. This move, disclosed on Thursday, stands in response to their roles in human trafficking and forced labour as connected with cryptocurrency fraud.

The penalties have been imposed to prevent and curtail human rights abuses and other related offenses. OFAC of the Treasury said that Ly Yong Phat businesses engaged in scams, and investors were defrauded into investing in cryptocurrency and foreign exchange trading. These scams were operated from cyber cafes and other online facilities, where trafficked workers were employed.

FBI Reports Surge in Crypto Scam Losses; Treasury Imposes New Sanctions

The Treasury pointed out that such scams are usually used to lure individuals into participating in other scams involving virtual currency or forex. Most of these operations are conducted by organised crime syndicates from Southeast Asia. According to the FBI, losses from cryptocurrency investment scams have skyrocketed, with statistics showing $2.57 billion in 2022 and $3.96 billion in 2023.

The consequence of the sanctions is that all the property of Ly Yong Phat and the companies related to him in the United States are frozen. According to the guidelines, no U.S. person can engage in any transactions involving these assets. Similarly, any assets in which the sanctioned individuals have an interest are also frozen. These sanctions mean that US persons might be subjected to civil or criminal charges for these prohibited activities.

These OFAC sanctions penalise these abuses and ensure no further interaction with such individuals or companies. Both financial institutions and individuals must be careful since dealing with such designated parties may result in other sanctions or enforcement measures. The purpose of such measures is punitive and remedial regarding human rights abuses.

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