Philippines now haven for transnational cyber-crime groups—police

MANILA, Philippines—A top Philippine National Police official said the country has become a “haven” for transnational organized crime syndicates involved in cyber pornography, cyber sex dens, illegal online gambling, credit card fraud and identity theft due to weak laws against cyber crimes and the poor technical know-how of law enforcers.

Chief Superintendent Samuel Pagdilao Jr., director of the PNP Criminal Investigation and Detection Group (CIDG), said cyber-crime mafias, mostly foreigners, have established their base of operations in the Philippines.

Pagdilao said cyber-crime operators have taken advantage of the PNP’s “organizational and technical incapability” to fight cyber crimes.

While cyber-crime syndicates use sophisticated technology, he rued that “law enforcers in the country are lagging behind in terms of training and equipment.”

Pagdilao asked Congress to prioritize passing the proposed cyber-crime prevention law to address the country’s legal inadequacies.

He also asked the PNP to support the organizational and technical capability build-up of the CIDG’s cyber-crime unit.

Pagdilao said foreign mafias have been running cyber-sex dens and cyber-pornography operations in the country.

He said Korean mafias have been behind illegal online gambling and credit card fraud operations in the country.

Pagdilao said their recent arrest here of a Korean hacker wanted by Interpol revealed that “Korean cyber-crime syndicates are operating almost unhampered” in the country.

Shin Un-Sun, 38, was arrested by operatives of the CIDG’s Anti-Transnational and Cyber Crime Division last October 4 in his hideout in Barangay (village) San Juan in Sto. Tomas, Batangas.

He was caught hacking a corporate databank in his laptop at the time.

Pagdilao said the suspect was wanted in the Philippines and in South Korea for large-scale Internet fraud.

CIDG investigators have found that Shin Un-Sun’s group had hacked the servers of the country’s leading telecommunication companies and some private corporations.

Pagdilao withheld the names of the corporations due to pending investigation.

Shin was reportedly jailed in South Korea for three years for hacking the Korean Stock Exchange.

Shin was also accused of hacking the online databank of Hyundai Capital Corp., a Seoul-based financial service company specializing in auto financing, personal loans and home mortgage.

He allegedly blackmailed Hyundai Capital Corp. to pay a huge sum in exchange for his not leaking the account information of 420,000 clients as well as 13,000 passwords from customers’ loan accounts and credit rating information that he had hacked.

Pagdilao said Shin was also able to withdraw large amounts of money from the credit card accounts of hundreds of clients based on data he had stolen from the databank of international and local banks.

Pagdilao said that during their investigation, the suspect owned up to hacking bank and credit card records as well as the e-mails of several defense officials for the past 11 years and to being part of a Korean mafia of hackers.

Shin claimed that he was brought to the Philippines to develop illegal online casino programs that have been in use in the mafia’s illegal operations for years.

Pagdilao said the CIDG has already raided seven of these illegal online casinos operated by Shin Un-Sun’s group.

Pagdilao said the suspect also revealed that Korean mafias have been using Filipinos as “e-mules” for their transnational money laundering and credit card fraud operations.