New Bill Targets $13.7 Billion Cyber Fraud Loss by Sanctioning International Scam Compound Enablers

The newly introduced Scam Compound Accountability and Mobilization Act is a direct response to the massive international cyber fraud operations that cost Americans an estimated $13.7 billion in 2024. The bill’s main purpose is to create a coordinated, global strategy to dismantle international scam compounds—physical locations run by transnational criminal organizations that use victims of human trafficking and forced criminality to execute large-scale cyber-enabled fraud. It is essentially giving the U.S. government a new set of tools to go after the people and groups enabling these massive, high-tech criminal enterprises, many of which are explicitly linked to the PRC in the bill’s findings.

The Strategy: From Fraud to Foreign Policy

This isn't just a law enforcement effort; it's a foreign policy play. Within 180 days of enactment, the Secretary of State, working with the Attorney General and the Treasury Secretary, must craft a comprehensive global Strategy to counter these scam compounds. This strategy needs to identify both enabling countries (where governments allow the compounds to operate) and impacted countries (targets or sources of victims). Critically, the strategy must also detail how the U.S. will use sanctions and visa restrictions against the organizations and the third-party facilitators who keep these compounds running (Sec. 4).

To keep the ball rolling, the bill establishes an interagency Task Force 90 days after the Strategy is submitted. This Task Force is responsible for coordinating the implementation, monitoring the global scam compound landscape, and tracking performance indicators. Think of it as the project management team for fighting international cybercrime. The Task Force has a lifespan of seven years before the program sunsets (Sec. 5, Sec. 7).

Hitting Them Where It Hurts: Financial Sanctions

For most people, the most impactful part of this bill is the new power it grants the President to impose sanctions. Starting 180 days after the bill becomes law, the President can use the full force of the International Emergency Economic Powers Act (IEEPA) to block the property and financial transactions of any foreign person determined to have materially assisted or provided significant financial or technological support to these scam compounds or related services like recruitment fraud, human trafficking, or money laundering (Sec. 6). This is the government’s way of saying, “If you profit from enabling these criminal enterprises, we can freeze your assets in the U.S. financial system.”

However, it’s worth noting the fine print here. The terms “materially assisted” and “significant support” are not tightly defined in the bill, which gives the Executive Branch a lot of discretion in deciding who gets sanctioned. Furthermore, the President has the authority to waive these sanctions if it is determined to be in the “national interest,” requiring only a 15-day notice to Congress (Sec. 6(e)). While this flexibility is often necessary in foreign policy, it means the enforcement of these sanctions could be subject to political considerations.

What About the Victims?

One important element often overlooked in these bills is the human cost. The bill’s findings acknowledge that these compounds lure hundreds of thousands of human trafficking victims into forced criminality—meaning they are forced to commit the cyber fraud. The bill explicitly mandates that the Strategy must include objectives for supporting survivors of human trafficking and forced criminality, ensuring they are not penalized for crimes committed while under duress (Sec. 2, Sec. 4(b)(5)). For victims trying to escape these compounds, this provision is crucial, aiming to provide them with necessary support rather than treating them as criminals.

Ultimately, this bill aims to upgrade the U.S. response to a sophisticated global threat. If you’re a regular person worried about online scams, this legislation is good news because it seeks to dismantle the criminal infrastructure at the source. If you’re a business owner, it means the government is trying to reduce the risk of cyber-enabled fraud that can drain company resources. The success of this Act will ultimately depend on how aggressively the State and Treasury Departments use the new strategy and sanction powers it provides.