Cebu becomes a scam hub targeting U.S. authors
CEBU, PHILIPPINES — Cebu has gained notoriety as a hub for scam operations targeting self-published authors in the United States following the arrest of two Cebu-based business process outsourcing (BPO) executives and their U.S. associate.
The fraudulent scheme, which ran from 2017 to 2024, defrauded over 800 authors of more than $44 million (₱2.5 billion), according to U.S. authorities.
Michael Cris Traya Sordilla, CEO of Innocentrix Philippines, and Bryan Navales Tarosa, vice president of operations, were arrested in San Diego, California, on December 9, 2024. Their U.S.-based partner, Gemma Traya Austin, was apprehended three days later in Chula Vista. The trio faces charges of conspiracy to commit mail and wire fraud, as well as money laundering—each carrying a potential 20-year prison sentence.
How the scam targeted vulnerable authors
In an interview with Rappler, several insiders confirmed that the scam targeted aspiring authors—many elderly—through unsolicited calls and emails.
In Innocentrix’s case, employees posed as representatives of PageTurner Press and Media LLC, claiming connections with publishers and Hollywood studios. Victims were promised lucrative book-to-film deals but were required to pay upfront fees for services such as screenplay development, taxes, book marketing, or publicity campaigns. Once payments were made, communication ceased, leaving victims without the promised services.
“This is a whole shadow industry in the Philippines,” said Victoria Strauss of Writer Beware, a website that exposes scams in the publishing industry. Strauss noted that Cebu has become a hotspot for these fraudulent activities.
The scam’s modus operandi mirrors a “pig-butchering” scheme—a long-term fraud where victims are manipulated into paying increasing amounts of money under false pretenses. Insiders revealed that similar operations are widespread in Cebu City’s Capitol area, Cebu IT Park, Mandaue City, and Lapu-Lapu City.
Industry leaders raise concerns over reputation damage
Many scammers reportedly have backgrounds in legitimate self-publishing companies in Cebu but later branched out to start their own fraudulent operations. These schemes have raised concerns among local BPO leaders about their potential impact on the industry’s reputation.
Mike Cubos, CEO of Performance360 Global Services Inc., expressed alarm at the scale of the fraud: “The Philippines ranks first globally in publishing fraud cases,” he said, citing data from Writer Beware.
Cubos warned that such scams could lead to stricter U.S. regulations on outbound campaigns, potentially harming small and medium-sized BPO firms reliant on these programs.
Suspiciously high commissions offered by companies like Innocentrix also raised red flags within the local BPO community. Cubos questioned how such firms could afford multimillion-peso incentives for agents while maintaining profitability.
“When I did the calculations, there was definitely something wrong,” he added.
Calls for government crackdown intensify
While some industry leaders dismiss these scams as isolated cases, others emphasize the urgent need for government intervention to protect Cebu’s BPO sector from further reputational harm. Authorities have shut down several fraudulent firms operating without permits but stress that sustained efforts are required to address this growing issue.
The Federal Bureau of Investigation (FBI) has urged victims to report their experiences via AuthorFraud@fbi.gov as investigations continue into this multi-million-dollar scam network.
Cebu’s rise as a hub for publishing scams has sparked fears that it could tarnish its image as a reliable outsourcing destination. With competition from emerging markets like South America and South Africa already threatening the Philippines’ dominance in the BPO industry, stakeholders warn that unchecked fraud could accelerate this decline.
