US Report Finds Fragmented Response to Multibillion-Dollar Cyber Scams

A recent investigation by Democrats on Congress’s Joint Economic Committee (JEC) has revealed a fragmented federal response to escalating cyberscams, which cost Americans nearly $18 billion in 2025. The report concludes that federal agencies lack a consolidated record of money lost to cyberfraud, funds seized from overseas scam operations, or amounts returned to victims, leaving individuals with limited options for recovery.

The investigation, led by Senator Maggie Hassan of New Hampshire and Representative Don Beyer of Virginia, also found that the government does not adequately incentivize private sector entities, such as financial institutions and social media companies, to proactively detect and address the abuse of their services while protecting user privacy.

The FBI reported that Americans lost approximately $18 billion in 2025 to cybercrime, with overall reported internet-crime losses reaching $20.9 billion—a 26% increase from the previous year and roughly triple the 2021 total. Despite the escalating nature of these crimes, the report indicates that the government's response has not kept pace, with only a fraction of lost funds being recovered.

Recovery Efforts and Data Gaps

While the FBI stated it returned $336 million to scam victims in 2025, and the Secret Service returned over $770 million in seized assets across fiscal years 2024 and 2025 (though these figures include various fraud schemes, not solely cyber threats), these amounts represent a small portion of the total losses. Suzanne Sando, a fraud analyst at Javelin Strategy & Research, noted that the fragmentation in reporting systems, including differing time periods and fraud categories, complicates the government's ability to assess the full scope of the problem.

"Many of the groups and entities that scam victims report their losses to operate on disparate systems," Sando explained. "The fragmented nature of these reporting entities means there’s a lack of true accounting of losses—which also means that our grasp of overall scam losses is likely less than the truth of the situation."

To address these issues, the Congressional report advocates for new legislation, including the bipartisan ReportScams.Gov Act. This bill aims to mandate a unified federal strategy to combat scams and establish a central resource for Americans seeking information and assistance.

A more coordinated reporting system could provide a clearer picture of the problem's scale, aid advocacy groups in developing preventive strategies, and help inform the public about potential schemes. According to the FBI’s 2025 Internet Crime Report, individuals aged 60 and older reported losses of about $7.7 billion, a 60% increase from the prior year, representing the highest total losses for any age group. Individuals under 18 reported nearly $13 million in losses across over 13,000 internet-crime complaints in 2025.

Contributing Factors and Obstacles

Experts point to the increasing sophistication of scams, partly driven by advancements in artificial intelligence and the prevalence of deepfakes, as a factor in their growing impact. Criminals are leveraging social media to build trust and using AI to create more convincing fraudulent messages, profiles, and media with less effort, enabling them to commit scams at scale.

Jake Braun, executive director of the Cyber Policy Initiative at the University of Chicago, highlighted that highly vulnerable populations, including seniors and minors, are increasingly exposed as they engage more with online platforms. He noted that many scams are operated by organized criminal networks in Southeast Asia, often using trafficked workers.

Recovering stolen funds is difficult due to the diffuse nature of the issue, spanning multiple countries, financial institutions, and criminal enterprises. Investigations are complicated by the sheer volume of victims across numerous countries and the cumulative effect of many relatively small individual losses, making it challenging for law enforcement to focus on smaller-scale thefts.

Braun indicated that with limited law enforcement resources dedicated to the issue, officials tend to prioritize dismantling large criminal rings rather than pursuing individual cases of smaller financial losses. This "siloed" approach to reporting and investigation also creates confusion for victims and hinders rapid coordination among government entities.

The State Department reported having 60 employees in the U.S. and Asia dedicated to combating overseas scam compounds, stating it possesses the necessary tools for international action.

Obstacles to providing better protections include a "lack of clear ownership and responsibility" within the private sector. Sando emphasized the need for coordinated efforts across industries like financial services, telecommunications, and social media. She suggests the government should facilitate information sharing, track scam trends and losses, report recovery rates, and implement measures to reduce scam effectiveness. Social media companies, in particular, face calls for greater accountability regarding fraudulent ads and impersonation accounts.

Braun suggested that holding these platforms accountable is a tangible way for governments to proactively address scams. He also advocated for incorporating educational components into cyber grants for state and local governments, focusing on protecting at-risk communities. Tailoring solutions to specific vulnerable groups, he believes, is crucial for a comprehensive approach to reducing cyberscam rates in the U.S.