Sri Lanka becoming new base for Asia's scam networks

Sri Lanka is becoming a new base for Asia's scam networks as criminal gangs reportedly relocate from Cambodia, seeking new operational grounds. Investigators point to a combination of factors, including visa-free travel, available building space, robust telecommunications, and an established informal money transfer system, as making the South Asian island nation an attractive destination for scammers.

Authorities in Sri Lanka have responded by establishing a new cybercrimes unit. They report arresting over 1,000 individuals in 2026 alone, primarily in western beach areas popular with tourists and in the capital, Colombo. Assistant Police Superintendent Fredrick Wootler stated that police, immigration, and the central bank are collaborating to control the situation. However, observers note that the country faces a narrow window to manage these fast-moving and increasingly sophisticated criminal operations.

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Police, along with the immigration department and the central bank, are working as a collective effort to see that this is being controlled.

"In Sri Lanka there are issues with implementing our laws, the fact that we don’t necessarily crack down on these companies – they simply use tourist visas," said Dilrukshi Handunnetti, director at the Center for Investigative Reporting Sri Lanka. Police raids have uncovered large-scale operations, with one raid on the west coast finding over 150 foreign nationals allegedly running a cyberscam, and another near Colombo arresting 120 foreign nationals in a multi-storey building.

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In Sri Lanka there are issues with implementing our laws, the fact that we don’t necessarily crack down on these companies – they simply use tourist visas.

As pressure mounts, some operators are shifting from large compounds to hotels and apartment buildings, which can be rented and abandoned quickly. Erin West, founder of anti-scam non-profit Operation Shamrock, noted this shift makes monitoring more difficult. "I think we’ve created such skilled workers, whether they wanted to be or not, that they can operate really in any kind of environment," she said. A US congressional report from July 2025 warned that fraud networks are relocating to areas with "regulatory stress", jurisdictions with weak enforcement but strong digital infrastructure.

This trend reflects a broader pattern of scam operations expanding beyond traditional strongholds in places like the UAE, Timor-Leste, Fiji, and parts of Africa. China has expressed concern, partly influencing Cambodia's crackdown earlier in 2026. The Chinese Embassy in Sri Lanka has stated it is "closely following" the situation, indicating growing international attention on Sri Lanka's role in transnational crime.

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This is happening in ways that are unfortunately even more difficult for us to keep our eyes on.