Yatai City in Myawaddy, Myanmar, has ignored Thailand's power outage measures and organized its power generator to hold a Spring Festival party in 2025. A recent investigation by Wen Wei Po journalists found that the parent company of the main developer of this hotbed of fraudulent gangs is the Hong Kong-registered Yatai International Holdings Group (hereinafter referred to as Yatai). The notorious She Zhijiang, one of the leaders of the fraudulent KK Park, is the sole shareholder.
Reporters investigated and found that Yatai is suspected to be a shell corporation that has changed its secretary many times. Its last registered office in Hong Kong is an inconspicuous garage. Staff at the garage said they did not know Yatai or She but admitted that the boss had lent the garage's address to several companies for registration purposes. On the other hand, the issuer and parent company of Tether, a cryptocurrency commonly used in illegal activities around the world, is also registered in Hong Kong.
Root of all evil
She Zhijiang, also known as She Lunkai, alias Tang Kriang Kai, is a Chinese businessman born in Shaodong, Hunan province, who later acquired Cambodian nationality. He is not only the leader of several multinational criminal syndicates, but also involved in illegal gambling, telecommunication fraud, and human trafficking, and is one of the key controllers of the KK Park in Myanmar, which is involved in heinous crimes such as unlawful detention, live organ harvesting, and sexual assault. In May 2021, Interpol issued a Red Notice for him, and in August 2022, he was arrested in Thailand and is currently facing extradition to mainland China.
In 2017, She became involved with a Myanmar fraud group in the development of the Yatai City project in Myawaddy, which has been associated with various fraudulent activities. A report by Wen Wei Po, based on publicly available online information, reveals that Yatai City was developed by Chit Linn Myaing and Oriental Eternity Holdings Limited, with the latter's parent company, Yatai, registered in Hong Kong.
Records indicate that Yatai was registered in early 2017, and the initial shareholders and directors were not She but a man surnamed Wang, who claimed to reside in Hunan, suggesting a possible connection as a fellow townsman of She. Coincidentally, the development of Yatai City began in September 2017, and in October of the same year, She replaced Wang as the sole director of Yatai, holding this position until his arrest. The company was dissolved in September of the previous year.
Documents show that from its establishment to its dissolution, Yatai reported no substantial profits, raising suspicions that it operated as a shell company, potentially serving as a front for paving the way for the Yatai City project in Myawaddy.
Double-edged sword
Hong Kong's company registration system is quite lenient. The Yatai International Holdings Group, closely related to the Myanmar phone scam syndicate, is suspected of using addresses such as subdivided apartments and garages for registration, making it more difficult for law enforcement agencies to investigate.
Several experts in Hong Kong recently stated in an interview that there are indeed shortcomings in the current company registration system. However, the free and open business environment is the cornerstone of Hong Kong's success. The entire company registration system should not be tightened because of the illegal activities of a small number of companies; rather, there should be precise enhancements in the regulation of secretarial companies and the establishment of laws specifically targeting telecom fraud, similar to those in mainland China and Europe and the United States.
Why do illegal group leaders want to register companies in Hong Kong? In an interview with Wen Wei Po, Professor Terence Chong, Executive Director of the Lau Chor Tak Institute of Global Economics and Finance of CUHK, stated that telecom fraud exists worldwide and is not unique to Hong Kong, and criminals exploit Hong Kong's mature financial system and convenient business environment.
He further explained that if illegal activities collect money through personal accounts, they can easily be traced by law enforcement. Therefore, telecom fraud groups tend to use corporate accounts, especially since opening a company account in Hong Kong is convenient and allows for easy fund transfers. Compared to the less mature banking systems in Southeast Asia, establishing a company in Hong Kong makes it easier to remit money worldwide.
Moreover, Hong Kong's relaxed business environment, simple company registration process, and minimal documentation requirements enable criminals to quickly register new companies, collect money, and then immediately close the companies to evade investigation. What's worse is that the addresses left during Hong Kong company registration may not be real addresses and might even be false ones (such as garages or secretarial companies), increasing the difficulty for law enforcement to track them down.
Chong emphasized that there is no perfect system in the world. As an international financial center, Hong Kong's free and convenient business environment and mature financial system are the foundations of its development. However, while attracting legitimate businesses, it is inevitable that some will exploit these conveniences for illegal activities. Therefore, while balancing free economic development, the Special Administrative Region government must strengthen regulation and fill in the gaps.
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