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By Mike Kuiken and Randy Schriver
U.S. China Economic and Security Review Commission
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The American people are under attack. The frontlines don't look like battlefields, but rather a computer screen, a phone call, or a social media message. The bipartisan U.S.-China Economic and Security Review Commission recently completed a report that details how massive scam centers across Southeast Asia—many operated by Chinese criminal networks—are systematically robbing Americans of billions of dollars a year.
These are not one-off criminal operations. They are industrial-scale fraud factories that have turned digital deception into one of the world's most lucrative criminal enterprises—rivaling, and in some estimates surpassing, the global drug trade. According to our recent Commission findings, Americans lost over $5 billion to scams tied to these networks in 2024 alone.
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The victims aren't faceless statistics. One Oklahoma couple lost more than $5 million—depleting life savings meant for retirement—while in Maryland, a single victim was bilked of over $3 million in just a few months, shattered by "pig-butchering" schemes involving false romance and crypto investments.
But these scam centers are not just about theft. They represent something more troubling: criminal enterprises operating with what the Commission found to be "implicit backing from elements of the Chinese government." Beijing tolerates these operations when they target Americans but cracks down when they harm Chinese citizens. Even more disturbing, the Commission concluded that China is "exploiting the problem" of these scam compounds to advance its own interests.
This selective enforcement fits a larger pattern. These operations thrive not just because of local corruption and weak enforcement, but because Beijing deliberately chooses permissive environments—embedding its proxies in handpicked, loosely governed enclaves often tied to Belt and Road investments. Whether it's the flow of fentanyl precursors, cyber operations, or now these scam networks, China consistently exploits grey zones—where harm to Americans carries little risk, but harm to Chinese citizens brings swift reprisal.
Behind these scams, according to the Commission's findings, Chinese crime syndicates have aligned themselves with Beijing's geopolitical agenda. These groups promote pro-Beijing propaganda, support Belt and Road Initiative projects, and echo Chinese patriotic rhetoric. In return, they often operate with little interference and sometimes even strategic utility to the state. The Commission's analysis suggests this represents a form of indirect statecraft—one that helps China expand its influence, corrupt its neighbors, and undermine U.S. interests, all while denying responsibility.
The Commission's findings place these scam operations within a broader pattern of Chinese state behavior. This isn't about cataloging unrelated grievances—it's about recognizing a consistent strategy. Just as Beijing has tolerated the flow of fentanyl precursors that poison American communities while cracking down on domestic drug problems, it has allowed criminal networks to target American victims while protecting Chinese citizens. The pattern is consistent: activities that harm the United States operate with minimal interference, while those affecting China face swift action. Whether through cyber operations, intellectual property theft, or now these scam centers, China exploits grey zones that provide strategic advantage while maintaining deniability.
This isn't about politics—it's about national resilience. Americans deserve to know how foreign adversaries are targeting them, not just through traditional means, but through criminal networks and digital manipulation. Law enforcement, financial institutions, and the tech sector all have roles to play in tightening the screws on these scam centers, but we also need a clear-eyed understanding of the state-level strategy behind them.
At the same time, recent efforts by the Trump administration to streamline the State Department and USAID—including sharp staff cuts and program consolidations—raise important questions about institutional focus. These changes may be driven by efficiency, but they also risk sidelining long-term threats like this one. Protecting Americans from transnational cyber-enabled fraud should remain a diplomatic, development, and law enforcement priority—not a casualty of reorganization.
The Commission's report makes one thing clear: The United States is not just dealing with criminals. We are dealing with a system of exploitation that serves the interests of an authoritarian state that sees chaos abroad as leverage at home.
The American people are not passive victims. But we do need to wake up to the nature of the threat. Scam centers may look like low-level crime, but they are something far more serious: a quiet front in a much broader conflict.
We can't afford to navel-gaze while innocent Americans watch their retirement savings, college funds, and life savings hoovered up out of their bank accounts by criminal syndicates that the Commission's report documents as operating with geopolitical backing. As the Trump administration continues to negotiate trade deals and engage with China, shutting down these scam centers must be part of the conversation.
Mike Kuiken is a commissioner on the bipartisan U.S.-China Economic and Security Review Commission and a distinguished visiting fellow at the Hoover Institution at Stanford University.
Randy Schriver is the vice chair of the U.S.-China Economic and Security Review Commission and chief executive officer of the Institute for Indo-Pacific Security (IIPS).
The views expressed in this article are the writers' own.
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