WASHINGTON, DC – On Wednesday, March 25, the Joint Economic Committee held a hearing entitled The Rising Global Scam Economy: Modernizing Federal Approaches to Protect Americans from Foreign Fraudsters. Led by Committee Chairman David Schweikert (R-AZ) and Ranking Member Maggie Hassan (D-NH), the hearing focused on the threat posed by overseas scam compounds, coordination among federal agencies to fight scams, and the economic impacts of scams on Americans.  

“Criminal syndicates backed by foreign governments are preying on American seniors, often conning them out of their life savings, while also targeting our economy by stealing intellectual property, and undermining national security,” said Chairman Schweikert. “From AI-driven scams targeting vulnerable Americans to organized fraud operations in Southeast Asia, the money stolen from our citizens is fueling criminal networks and propping up foreign organizations. Our current tools simply aren’t keeping pace. We must modernize our approach, strengthen enforcement, and protect all Americans from these evolving threats.”

The hearing built on Chairman Schweikert and Ranking Member Hassan’s efforts to combat scams. Previously, Chairman Schweikert introduced legislation in the house to combat cybercrime scams, the two issued requests to federal agencies about their efforts to crack down on overseas scam networks and issued a scam alert to Americans ahead of the holidays.

The first panel featured current officials at the Department of Justice, Federal Bureau of Investigation, U.S. Attorney’s Office for the District of Columbia, Federal Trade Commission, and the U.S.-China Economic and Security Review Commission. It is the first hearing on scams during this session of Congress to include current Administration officials.

Panel 1:

Mr. Richard Goldberg, Associate Counsel, Fraud Section, Criminal Division, U.S. Department of Justice

Mr. Gregory Heeb, Deputy Assistant Director, Federal Bureau of Investigation

Ms. Karen Siefert, Director, Scam Center Strike Force, U.S. Attorney’s Office for the District of Columbia

Ms. Lois C. Greisman, Associate Director, Division of Marketing Practices, Federal Trade Commission

Ms. Reva Price, Commissioner, U.S.-China Economic and Security Review Commission

The second panel featured leading scams experts from the Government Accountability Office, the Aspen Institute, AARP, and the private sector.

Panel 2:

The Honorable Stewart Baker, Principal, Stewart Baker Consulting PLLC, former Assistant Secretary of DHS for Policy

Mr. Seto J. Bagdoyan, Director, Forensic Audits & Investigative Service, U.S. Government Accountability Office

Ms. Kate Griffin, Director of Inclusive Financial System, Aspen Institute Financial Security Program, Aspen Institute

Ms. Kathy Stokes, Director, Fraud Prevention Programs, AARP

Chairman Schweikert (AZ-01)

Chairman Schweikert began by asking how to move away from a “pay and chase” model of fraud prevention, where money is lost and then recovered, to a system where fraudulent transactions are stopped before the money ever leaves an individual’s account. He emphasized the growing sophistication of scams and the significant impact on even highly educated and affluent individuals.

Ms. Siefert responded that addressing scams requires a multi-pronged approach. She highlighted the importance of education but acknowledged it is not sufficient on its own. She stressed the need for broader cultural awareness about verifying online interactions and emphasized that private industry must play a larger role. This includes implementing warning systems, detecting suspicious behavior, and developing tools, such as apps or alerts, to help users identify scams in real time.

Chairman Schweikert expressed skepticism about relying heavily on education, given how advanced and manipulative modern scams have become. He pushed for stronger technological and policy-based solutions that could prevent fraudulent contact or transactions altogether.

Mr. Goldberg explained that solutions must focus on two key areas: the communication pathway and the payment pathway. On the communication side, technology companies must improve their ability to block or detect scam attempts before victims are contacted. On the payment side, financial institutions and payment platforms must have safeguards in place to stop suspicious transactions before funds are transferred. He emphasized that law enforcement is largely reactive and that prevention depends on private-sector innovation and coordination.

Mr. Heeb added that current efforts, such as the “financial fraud kill chain,” can sometimes stop or recover funds, but they still rely on fraud being reported after it begins. He reinforced the Chairman’s concern that more proactive, technology-driven prevention is needed.

Ms. Greisman defended the role of consumer education but agreed it must be paired with innovation. She pointed to efforts to develop technologies like scam call labeling, voice-clone detection, and improved information sharing across industries.

Chairman Schweikert reiterated his interest in more aggressive technological solutions, such as systems that block scam communications entirely before they reach users.

Ms. Price concluded by outlining policy options, including stronger verification systems for communications (such as caller ID authentication frameworks), better detection of spoofed or foreign-origin calls, and increased coordination with financial institutions, especially in areas like cryptocurrency, to identify and stop fraudulent transactions earlier.

Overall, the discussion centered on shifting from reactive fraud response to proactive prevention, with a strong emphasis on leveraging technology, improving industry coordination, and supplementing education with systemic safeguards.

Rep. Victoria Spartz (IN-05)

Rep. Victoria Spartz began by sharing real-world examples from her constituents, highlighting the growing sophistication and severity of fraud. She described cases where individuals, both elderly and middle-aged, lost hundreds of thousands of dollars to scams, including kidnapping schemes and identity theft that wiped out entire life savings. She emphasized that these crimes are often international, leaving local law enforcement and even state attorneys general with little ability to respond.

She expressed frustration that when constituents report these cases, there is often no meaningful follow-up or resolution. While acknowledging the complexity of the issue, she argued that the current system is failing victims and called for a more coordinated and effective response. She suggested that Congress may need to establish more dedicated units and procedures within federal agencies to better handle fraud cases and support victims.

Rep. Spartz directed her question to Mr. Goldberg and Mr. Heeb, asking for concrete ideas on how to improve response and enforcement.

Mr. Goldberg explained that thousands of complaints are submitted daily to agencies like the FBI and FTC. He stressed that reporting fraud is critical, as it allows agencies to track trends, identify major schemes, and build cases against perpetrators. These reports also help inform industry and guide resource allocation. However, he acknowledged that not every complaint leads to an investigation, as agencies must prioritize larger or more systemic cases.

Rep. Spartz pushed back, noting that in many instances her office has helped constituents report fraud, but no visible action was taken, reinforcing her concern that the system is overwhelmed and insufficient for the scale of the problem.

Mr. Heeb responded that the FBI receives around 3,000 complaints per day and uses that data for analysis and operations. He highlighted initiatives like “Operation Level Up,” where information gathered from seized scam devices is used to identify and warn victims, sometimes alerting them for the first time that they are being defrauded. He reiterated that reporting is essential, even if it does not result in immediate action.

Rep. Spartz then asked Ms. Greisman from the FTC whether improvements are needed.

Ms. Greisman acknowledged the frustration but explained that with millions of reports annually, agencies do not have the capacity to respond individually to each case. Instead, the FTC focuses on providing educational resources and identifying broader trends. She noted that more personalized intervention models, like those used by the Better Business Bureau, operate on a much smaller and different scale.

Overall, the exchange highlighted a key tension that while reporting fraud is essential for tracking and enforcement, the sheer volume of cases limits the government’s ability to provide direct assistance, leaving many victims without immediate help and raising the need for more scalable, coordinated solutions.

Senator Ashley Moody (FL) 

Senator Ashley Moody began by emphasizing the scale and urgency of fraud across the country, noting that it shocks the public and erodes trust in government. She highlighted how technological advances have made it far easier for criminals to steal life savings instantly, while law enforcement struggles to keep pace. She stressed that fraud now affects all demographics, not just seniors, and has become pervasive across economic and geographic lines.

Drawing on her experience as Florida’s Attorney General, Sen. Moody described how her state responded by creating a specialized, statewide cyber fraud team. By training prosecutors and investigators and coordinating across agencies, Florida was able to identify patterns, turning what appeared to be isolated cases into large-scale fraud schemes involving many victims. She noted that this kind of coordination helped elevate cases to the federal level that might otherwise have gone unnoticed.

She raised concerns that current enforcement structures lack the resources, coordination, and legal tools, particularly for international cases, to effectively combat modern fraud. She also reiterated her call for stronger national leadership, referencing the recent appointment of a senior Justice Department official focused on fraud, but warning that more systemic action is needed.

Sen. Moody then asked Mr. Heeb how to replicate and scale successful models like Florida’s across other states and how federal agencies could better support and coordinate these efforts.

Mr. Heeb responded that the FBI is working to strengthen collaboration through its field offices and task force model, which brings together federal, state, and local partners. He pointed to financial crime squads in FBI field offices as a foundation for expanding these efforts and emphasized the importance of shared training and coordination to improve investigations.

Sen. Moody pushed back slightly, arguing that relying on a single task force officer or limited federal resources is insufficient given the scale of the problem. She stressed that states must take a more active role by building their own expertise and embracing new technologies to combat modern fraud.

Mr. Heeb agreed, adding that the FBI can help “train the trainers” by equipping state and local partners with the knowledge and tools needed to investigate these crimes more effectively.

Overall, the discussion focused on the need for a more coordinated, scalable approach, combining federal leadership with empowered state-level action, to address the rapidly evolving threat of fraud.

Chairman Schweikert (AZ-01)

For the second panel, Chairman Schweikert opened his line of questioning by expressing urgency and moral concern, asking how to stop Americans from being exploited and how to prevent money from flowing to overseas scam operations that often involve forced labor. He emphasized that beyond financial harm, these scams are funding human exploitation abroad and called for more aggressive solutions.

He directed his first question to Mr. Baker, raising the idea of using constitutional “letters of marque” to authorize private-sector actors, such as ethical hackers, to disrupt scam networks and recover funds.

Mr. Baker responded that the idea is worth considering under careful constraints, noting there is little downside to piloting such an approach. He also suggested considering more aggressive international actions, including working with foreign governments or regional partners to dismantle scam centers directly, similar to actions taken by other countries.

Chairman Schweikert then broadened the discussion to the full panel, asking for concrete technological, policy, and legal frameworks that could stop fraudulent transactions before money leaves victims’ accounts. He specifically raised questions about liability protections, identity verification systems, and safeguards around financial tools like crypto ATMs.

Ms. Griffin explained that there is no single solution, but the technology to combat scams already exists across multiple points in the system. She emphasized that criminals exploit gaps at every stage and that solutions must address each step. This requires empowering the private sector through policy changes and enabling collaboration with the government to deploy and scale these technologies effectively.

Ms. Stokes added that the problem has grown over decades due to complacency and misconceptions about who falls victim to scams. She stressed that there is no single fix and that a combination of solutions is necessary to catch up to the scale of the fraud being perpetrated.

Chairman Schweikert acknowledged that complex problems require multifaceted solutions rather than simple fixes.

Mr. Bagdoyan emphasized the need for a comprehensive, strategic approach. He argued that policymakers must clearly define the threat, assess risks, evaluate current efforts, identify gaps, and implement coordinated solutions across technology, regulation, and organizational structures. With the expansion of AI, he warned that scammers are advancing rapidly while government responses lag behind.

Chairman Schweikert concluded by highlighting the accelerating threat posed by artificial intelligence, warning that future scams may become fully automated and far more difficult to detect. He called for flexible, forward-looking policies that can adapt as technology evolves and stressed the need for bipartisan cooperation and global coordination. He reiterated interest in leveraging private-sector expertise as part of the solution. 

Rep. Victoria Spartz (IN-05)

Rep. Spartz emphasized her concern that the federal government lacks clear leadership and coordination in combating fraud, echoing findings from the Government Accountability Office. She pointed to the nation’s broader fiscal challenges to underscore the seriousness of the issue and the need for decisive action. She stressed that fraud is a material problem requiring accountability and asked whether the FBI is the appropriate agency to take the lead.

Mr. Bagdoyan responded that, based on GAO’s assessment, the FBI is currently best positioned to serve as the lead agency due to its capabilities, experience, and international reach. However, he noted that other agencies, such as the FTC and CFPB, also have important roles. He added that agency responses to GAO recommendations have been mixed and need to accelerate, given the immediate and growing risks posed by fraud.

Rep. Spartz questioned whether structural changes are needed within agencies to dedicate sufficient resources to fraud prevention and enforcement. Mr. Bagdoyan indicated that agencies have proposed steps like creating specialized working groups, but broader structural, legislative, and regulatory changes may be necessary. He also highlighted a key challenge, noting that without clearly defining the scope of fraud, it is difficult to develop an effective strategy.

Rep. Spartz expressed frustration with the lack of urgency in Congress and government, criticizing the tendency to produce reports without taking meaningful action. She called for a shift toward concrete solutions and innovation. Turning to Mr. Baker, she asked how government could better integrate with private sector innovation to combat increasingly sophisticated fraud schemes.

Mr. Baker responded that while the FBI has broad jurisdiction, relying solely on law enforcement may not be sufficient, especially since victims rarely recover stolen funds. He argued that prevention should be the priority, such as stopping fraudulent transactions before money leaves the system. For enforcement, he suggested creating financial incentives such as rewards for identifying and recovering stolen assets, to improve outcomes. He also cautioned that focusing on prosecuting perpetrators overseas may be less effective than disrupting fraud earlier in the process.

Overall, the exchange highlighted the need for clear leadership, faster action, structural reforms, and greater emphasis on prevention and innovation in combating fraud.

The full hearing is available on YouTube here.

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