U.S. Sanctions Myanmar’s Karen National Army Over Crypto Scams and Fraud

The U.S. Treasury Department has imposed economic sanctions on the Karen National Army (KNA), a militia group based in Myanmar, for its involvement in large-scale online fraud, including cryptocurrency scams. The sanctions specifically target KNA leader Saw Chit Thu and his two sons, Saw Htoo Eh Moo and Saw Chit Chit, due to their key roles in running illegal activities.

According to U.S. officials, the KNA is responsible for operating online romance scams known as “pig butchering.” These scams involve fraudsters building emotional relationships with victims online and eventually convincing them to invest in fake cryptocurrency schemes. The U.S. Department of Justice stated on May 5 that these scams have led to American victims losing billions of dollars.

The KNA controls a region that stretches across parts of Myanmar and Thailand, which it uses as a base for criminal operations. The group is believed to have military alliances within Myanmar, helping it expand its illegal activities. Though it has changed its name in the past, its operations and military ties have remained active.

Deputy Treasury Secretary Michael Faulkender said the cyber scams run by the KNA have stolen billions of dollars from victims, with U.S. citizens among those most affected. The sanctions are part of ongoing U.S. efforts to dismantle international scam networks and hold responsible parties accountable.

This move follows earlier actions by the U.S. government to target scam networks in Southeast Asia. The U.S. Financial Crimes Enforcement Network (FinCEN) recently identified the Huione Group, based in Cambodia, as a key player in processing money from cyber fraud. Sanctions were also placed in 2023 and 2024 on Cambodian businessman Ly Yong Phat and his companies for their involvement in scam-related human rights violations.

Southeast Asian cyber scams have become a growing threat. Many scam centers operate out of casinos, hotels, and protected compounds, often using forced labor and violence to control victims. In 2022, Americans lost around $2 billion to such scams. That number rose to $3.5 billion in 2023.

The KNA is believed to earn money by leasing land to criminal groups, offering security services, and supporting human trafficking. Survivors from one major scam compound said they witnessed KNA soldiers guarding the facility.

Under the new sanctions, all assets linked to the KNA and its leaders that are under U.S. jurisdiction will be frozen. American individuals and businesses are banned from doing business with them. Any company that is 50% or more owned by sanctioned individuals is also subject to these restrictions.

The U.S. Treasury warned that working with the KNA or helping its members could lead to serious penalties. The sanctions aim to punish criminals and protect victims while preventing future financial crimes.