The Unintended Global Cost of Selective Anti-Scam Enforcement
Governments across the globe have long grappled with the rapid expansion of industrial-sized scam operations rooted in Southeast Asian nations including Laos, Myanmar, and Cambodia. Over the past several years, these criminal networks have drained billions of dollars from victims worldwide. The schemes are frequently linked to Chinese organized crime groups, rely on trafficked forced labor to run day-to-day scamming activities, and depend on sprawling global money laundering infrastructure to pocket illicit gains. They have grown so pervasive and deeply embedded across the region that even large-scale joint international law enforcement operations targeting individual scam hubs or top criminal leaders have failed to reverse their growth.
This week, the FBI announced that reported losses from cyber-enabled scams by American victims topped $17.7 billion in 2023 — a figure widely recognized as a major undercount of the true total, since large shares of scam victims never come forward to report their experiences. Many senior U.S. officials argue that one of the biggest barriers to fully tackling the crisis is insufficient collaboration with Chinese authorities. They contend that China’s current efforts to crack down on large-scale industrial scamming are geared almost entirely toward reducing harm to Chinese citizens, rather than rooting out the activity entirely to protect victims across the world.
“To China’s credit, it has cracked down on these operations, but its actions have been selective. It has largely turned a blind eye to scam centers that target foreign victims,” Reva Price, a member of the U.S.-China Economic and Security Review Commission, told a Senate hearing last month. “As a result, Chinese criminal syndicates have been given an incentive to shift their focus to targeting American people.”
Research published by the commission in March found that Beijing’s selective enforcement approach has emboldened scammers — even those operating within China’s borders — to keep running their schemes, as long as they exclusively target people outside of China. Other U.S.-based researchers have reached the same conclusion.
In congressional testimony last year, Jason Tower, then the Myanmar country director for the U.S. Institute of Peace’s Transnational Crime and Security in Southeast Asia program, noted that between 2023 and 2024, China recorded a 30% drop in scam losses suffered by its citizens, while the U.S. saw losses jump more than 40%. Tower explained that in response to how China enforces anti-scam rules, “scam syndicates are increasingly shifting their focus to target the rest of the world, and especially Americans.”
The United Nations Office on Drugs and Crime (UNODC) pointed out last year that scam hubs have been diversifying their workforce: they no longer primarily traffic Chinese nationals and other Chinese speakers, and now lure and trap workers from a much wider range of countries and linguistic backgrounds. UN researchers partially attribute this shift to scammers expanding their target pools to reach more populations globally, but add that the change is also a direct response to China’s anti-scam enforcement and Beijing’s efforts to shield its own citizens from harm.
“China is doing more to fight fraud — orders of magnitude more — than any other country,” says Gary Warner, a veteran digital scam researcher and director of intelligence at cybersecurity firm DarkTower. “But I would agree that China’s crackdown on scammers who target Chinese people has squeezed the balloon, so to speak, and led to more targeting of international and American victims.”
For years, the Chinese government has invested heavily in national public safety campaigns that warn Chinese citizens about scam risks and teach them how to avoid being victimized. Much of this public messaging leans into a sense of national solidarity. A widely shared viral meme in China, 中国人不骗中国人 (literally “Chinese people do not cheat Chinese people”), is often used to signal trust when sharing restaurant recommendations or job leads. But in the context of online scams, the phrase has taken on a darker, literal meaning.
As DarkTower’s Warner puts it, “Isn't stopping fraud against your own citizens the core goal of every country?” Even if China’s selective anti-scam enforcement across Southeast Asia is not a deliberate attempt to allow scamming of foreign victims, that does not change the outcome we see today: these transnational criminal networks continue to grow and flourish.
This pattern mirrors a longstanding dynamic in another major domain of cybercrime: ransomware. Some of the world’s most active and destructive ransomware gangs are based in Slavic countries, most notably Russia, and this has consistently blocked global law enforcement progress. Russia has long offered safe harbor to these cybercriminal groups, as long as they avoid targeting Russian citizens or entities that cooperate with the Russian government. The Kremlin has occasionally carried out selective enforcement against ransomware actors, but it has never launched the full, comprehensive crackdown that would be required to meaningfully mitigate ransomware as a global threat.
This is an edition of Made in China, the newsletter by Zeyi Yang and Louise Matsakis. Read previous issues here.
