Malaysia built a $100 billion city just 2 km from Singapore for 700,000 people; only 9,000 came, now scammers are moving into the ghost town

It was supposed to be a futuristic city rising from the sea, a $100 billion development of luxury homes, offices, schools and shopping centers just minutes from Singapore. Instead, Malaysia’s Forest City has become known for something far removed from the vision its developers once promised: empty apartments, deserted streets and a population far smaller than planned.

Now, the near-empty development has acquired another troubling role. Scammers are moving into the abandoned spaces.

A BBC report from August 2026 details how Malaysian police recently uncovered two alleged scam operations operating across 32 premises in Forest City, arresting 335 people and seizing assets worth about one million ringgit ($245,000), including hundreds of computers and more than 1,500 mobile phones.

From a $100 billion smart city dream to a “ghost city”

Forest City was announced in 2006 and officially launched in 2016 under then-Prime Minister Najib Razak. Built on reclaimed islands in southern Johor near Singapore, it was developed as a joint venture between Chinese property giant Country Garden and Esplanade Danga 88, owned by the Johor state government.

The project was envisioned as a green smart city, combining technology and environmental design with luxury residential towers, offices, schools, shopping centers and other amenities.

Its location was one of its biggest selling points. Forest City sits within the Iskandar Special Economic Zone, close to Singapore, and was expected to benefit from investments and infrastructure connecting the two countries.

The ambition was enormous. Forest City was projected to house 700,000 residents by 2035. But the population never came close to that figure. Only around 15% of the overall project has been completed, with just one of its four planned islands fully reclaimed. Only about 1% of the developed area is inhabited, with roughly 9,000 residents, as per the Bangkok-based International Institute for Trade and Development.

The city’s empty spaces became an opportunity for scammers

Those empty spaces are now proving useful for a very different kind of business. According to the BBC, Malaysian police raided two alleged scam operations in mid-July across 32 premises in Forest City. One operation occupied 27 apartments across five floors of a residential tower, while another spanned five bungalows. Police arrested 335 people.

Among those arrested were 309 Chinese nationals, 19 Indonesians, three Malaysians and four Myanmar nationals. Authorities seized 313 computers, 1,557 mobile phones, 17 laptops and 10 modems, along with other assets worth approximately one million ringgit. Police said the operations were allegedly being used by cryptocurrency syndicates running investment and romance scams against victims overseas.

Why a ghost city can be useful for fraud networks

Forest City's unusual circumstances may provide precisely the kind of environment that organized scam operations can exploit.

The development contains a large number of residential and commercial properties but has only a fraction of the originally expected population. Empty buildings and apartments can provide space for operations while attracting comparatively little attention.

The BBC reported that experts and residents believe the raids may represent only a small part of a much larger global scam industry.

That industry has become organized and professional. What once might have been small groups of fraudsters working from makeshift offices can now involve large teams, hundreds of phones and computers, cryptocurrency transactions and carefully structured schemes targeting victims in other countries.

How Forest City went from global investment dream to ghost town

Forest City's problems began long before scammers appeared. The project faced controversy over the environmental consequences of reclaiming land from the sea. Its marketing also attracted criticism for appearing to focus heavily on wealthy Chinese buyers rather than Malaysian residents.

That dependence left the project exposed when China tightened controls on overseas money transfers.

Political upheaval in Malaysia added another layer of uncertainty. After winning the 2018 election, then-Prime Minister Mahathir Mohamad announced restrictions on foreign property purchases in Forest City, damaging investor confidence.

The COVID-19 pandemic delivered another major blow. Meanwhile, Country Garden, once China's largest property developer, entered a severe financial crisis, creating further uncertainty around its massive overseas project.

Malaysia is trying to give Forest City a second life

The Malaysian government has not abandoned Forest City. Under Prime Minister Anwar Ibrahim, authorities have attempted to revive the development and attract investment from China and elsewhere.

Plans include improving transport links between Malaysia and Singapore, potentially with a stop at Forest City. The government has also considered a casino as part of efforts to stimulate economic activity.

In 2024, Malaysia's Lower House passed legislation declaring Forest City a duty-free island, another attempt to encourage visitors and investment. The government has also launched the Forest City Special Financial Zone, intended to transform the development into a financial and business hub.