The United Nations Office on Drugs and Crime (UNODC) has urged Southeast Asian countries to make operating an unlicensed virtual asset service provider (VASP) a criminal offense.

The report highlights that some VASPs, especially those with ties to known criminals, are facilitating transactions for fraud schemes and high-risk gambling operations. An unnamed entity was involved in transactions amounting to "at least hundreds of millions of dollars" with criminal operations.

"It is more critical than ever for governments to recognize the severity, scale, and reach of this truly global threat, and to prioritize solutions that address the rapidly evolving criminal ecosystem in the region," Masood Karimipour, UNODC's regional representative, stated.

The agency calls for improved monitoring of organized crime related to casinos and cyber fraud activities and better training for authorities on online gambling and money laundering methods. While not all scams involve cryptocurrencies, they are often preferred by fraudsters due to the rapid and cross-border nature of transactions, coupled with a generally low understanding of how cryptocurrencies operate.

The report also detailed the increase in diverse scam tactics, including impersonation scams and the use of AI technologies to enhance illegal operations, asserting that online fraud has become a significant industry in the region.