Regulating the Crypto-Laundering Chain: A Comparative Study of Scam Compounds and Money Mule Mechanisms Within Criminal Networks

This paper examines how scam compounds, money mules and crypto-assets operate as interdependent elements of contemporary money-laundering chains. It assesses whether existing anti-money laundering (AML) and crypto-asset regulatory frameworks are capable of disrupting these chains holistically, rather than addressing individual components in isolation, with particular reference to scam-compound activity in Southeast Asia. The study adopts a qualitative comparative case-study methodology grounded in legal and regulatory analysis. Four empirically grounded cases are examined: two Southeast Asian scam-compound enforcement cases (Cambodia and Myanmar) and two European crypto-asset seizure cases (Ireland and Italy). Judicial decisions, enforcement actions and regulatory instruments are analysed through a chain-based analytical framework aligned with Financial Action Task Force (FATF) standards, the EU Markets in Crypto-Assets Regulation (MiCA) and the Anti-Money Laundering Authority (AMLA) framework. The analysis reveals a structural divergence in enforcement strategies: Southeast Asian responses increasingly prioritise network- and infrastructure-level disruption of scam compounds, whereas European approaches remain largely centred on post-offence crypto-asset seizure through traditional proceeds-of-crime mechanisms. Across all jurisdictions, money mules emerge as a critical yet systematically under-regulated intermediary layer enabling the resilience of crypto-laundering operations. The paper advances existing AML typologies by conceptualising scam compounds, money mules and crypto-assets as interconnected components of a single crypto-laundering chain. This chain-based perspective offers a novel analytical and regulatory lens for understanding organised crypto-enabled fraud. The study is based on a qualitative, case-based design and does not aim for statistical generalisation. However, the analytical framework developed is transferable to other jurisdictions experiencing similar scam-compound and crypto-laundering dynamics. The findings suggest that effective AML enforcement requires coordinated intervention across multiple nodes of the laundering chain, including scam compound infrastructure and money mule networks, alongside traditional asset-seizure mechanisms and CASP supervision. By highlighting the structural links between scam compounds, coercive labour and crypto-laundering mechanisms, the paper underscores the broader social harms of crypto-enabled fraud and the need for integrated regulatory responses that address both financial crime and human exploitation.