By:
• Teng Yalirozy

• September 14, 2024 , 3:00 PM

PHNOM PENH – The Cambodian government has slammed the United States sanction report on the Cambodian tycoon Ly Yong Phat, his conglomerate L.Y.P. Group Co., O-Smach Resort, and the three hotels he owns or controls.

On Sept. 12, the U.S. imposed sanctions on Ly Yong Phat for human rights abuses involving forced labor in online investment scams resulting in victims suffering horrifying working and living conditions.

“Today’s action underscores our commitment to hold accountable those involved in human trafficking and other abuses, while also disrupting their ability to operate investment fraud schemes that target countless unsuspecting individuals, including Americans,” said Acting Under Secretary of the Treasury for Terrorism and Financial Intelligence Bradley T. Smith.

"Treasury will continue to shine a light on the criminal networks operating these illicit schemes and those who seek to perpetrate these abuses."

A day later, Cambodia’s Ministry of Foreign Affairs and International Relations shut down the report, saying it was “politically motivated” and contradicted the spirit of strengthening bilateral cooperation and mutual trust as expressed by U.S. Secretary of Defense Lloyd J. Austin III during his visit to Cambodia in June 2024.

“The U.S. Government's reliance on its Trafficking in Persons Report as the basis for these actions is both regrettable and misleading,” the ministry said. “The report fails to provide a balanced and accurate representation of Cambodia's steadfast commitment to human rights, law enforcement, and its determined efforts to combat human trafficking and forced labor.”

According to the U.S. Embassy Phnom Penh Spokesperson Wesley Holzer, the measures of the U.S. Department of the Treasury’s Office of Foreign Assets Control aim to increase accountability for human trafficking and other abuses while disrupting the exploitation of scam targets, including Americans.

“The United States continues to engage with the Cambodian government on regional and global issues of concern, including online scam operations, human trafficking, and rule of law that may impact Cambodia’s desired economic development and business climate,” he said.

Cambodia’s Ministry of Foreign Affairs said that the country has made significant progress in addressing transnational challenges, cooperating with international partners such as the United States, demonstrating a commitment to human dignity and the rule of law, and demonstrating proactive measures.

“Cambodia remains open to cooperation and committed to working with all international partners, including the United States, to tackle global challenges, but we insist that such efforts be grounded in dialogue, mutual interest, respect for sovereignty, and a genuine spirit of partnership,” the ministry said.

The ruling Cambodian People’s Party (CPP) also condemned the U.S. Treasury Department’s report on Ly Yong Phat who is a permanent member of the party’s central committee.

“The sanctions imposed on Ly Yong Phat violates Cambodia’s sovereignty, as Cambodia is an independent country and is not under U.S. law,” the CPP party stated in a press release on Sept. 13.

“The party strongly condemns the U.S. Department of the Treasury for its violation of Cambodia,” the CPP press release read. “The party demands the department to review the case and withdraw the sanctions on Ly Yong Phat.”

The Cambodia Oknha Association whose president is Ly Yong Phat also condemned the sanctions, stating that Ly Yong Phat and his L.Y.P Group have an important role in the country's economic society development.

“The association strongly believes that Ly Yong Phat did not commit human trafficking as accused by the U.S.,” its spokesperson said in a press release. “We demand the U.S. Department of the Treasury’s Office of Foreign Assets Control to review this injustice accusation and remove the sanctions.”

The Ministry of Foreign Affairs stated that these unilateral sanctions on Ly Yong Phat violate international law and fundamental interstate relations norms, particularly the principles of sovereign equality and non-interference.