At the State of the Union, President Donald Trump displayed a commitment to weed out ongoing and multifaceted efforts to defraud the American people. He announced that Vice President JD Vance would lead a “war on fraud,” promising to end the looting of the American taxpayer. This action adds firepower to the administration’s ongoing effort to identify and prosecute fraudsters.
Last week, the U.S. Treasury Department sanctioned individuals and entities tied to a timeshare fraud network operating out of Mexico and linked to the violent Jalisco New Generation cartel.
In plain terms: drug cartel operatives were running sophisticated phone scams that tricked American retirees into paying bogus “fees” to sell their vacation properties — stealing millions in the process.
That action is a welcome step. But more is needed.
For years, large-scale fraud was treated as a consumer nuisance — a problem for agencies like the Federal Trade Commission but not a national security priority. That era is over.
The Federal Trade Commission says Americans reported $12.5 billion in fraud losses last year. That figure alone should command attention.
What we are facing now is organized and large-scale criminal activity run from overseas, aimed directly at American citizens. These operations are structured, coordinated, and highly profitable. They are not random, one-off scams targeting grandma. They are structured, coordinated criminal enterprises generating enormous profits.
Retirees are losing their life savings after receiving calls from criminals posing as law enforcement or bank officials. Parents wire money after hearing what sounds exactly like their child’s voice. What they are really hearing is AI-powered deepfakes. Small business owners are even routinely tricked into transferring funds to fake vendors after reading convincing-looking email exchanges.
These crimes are carefully engineered, and the money they “make” is quickly moved through crypto channels and international banking systems. In some regions overseas, entire facilities are devoted to these operations.
In many cases, the same criminal networks involved in narcotics trafficking and human smuggling have expanded into financial fraud because it is lucrative and, historically, less risky.
The U.S. calculus for addressing this problem must change.
With foreign-based criminal organizations now systematically targeting Americans and siphoning billions of dollars out of our economy, this is no longer just a consumer protection issue. It is now one of national security and sovereignty.
The revenue generated by these fraud rings strengthens transnational criminal groups, fuels corruption, and increases the cartels’ capacity to operate across borders.
Worst of all, it erodes trust in the financial and communications systems Americans rely on every day.
This is an America First national security concern if I’ve ever seen one.
Large, organized fraud networks should be treated the same way we treat other transnational criminal enterprises. Coordinated investigations, aggressive asset seizures, and, where appropriate, sanctions against facilitators and financial channels that move illicit proceeds should all be on the table.
With the power to cut bad actors and their facilitators’ access to the U.S. financial system, the Treasury Department can significantly mitigate this epidemic. In fact, Treasury penalties can often be more disruptive than individual prosecutions.
Congress also has a role to play here.
Federal law should reflect the reality that many of these schemes are not small-time scams, but structured criminal enterprises operating across borders. Prosecutors need unambiguous authority to pursue the organizers, financiers, and leaders of these networks — even when they operate from abroad.
When fraud rings operate like cartels, they should be prosecuted like cartels. It should be that simple.
Technology companies must also take seriously the ways their platforms are exploited. Recognizing that AI-powered impersonation scams are expanding rapidly, they should implement basic safeguards and authentication standards. Such protections should not be optional — not when Americans’ savings and America’s national security interests are at stake.
For too long, fraud networks have operated on the assumption that they can reach into American homes from abroad and face limited risk. That assumption is part of what made the industry so profitable — and it’s why restoring deterrence is essential.
When criminal enterprises decide to build business models around exploiting Americans, they should expect sustained pressure — financial, legal, and diplomatic.
Protecting American families from organized financial crime is part of the government’s core responsibility.
STATES GAVE AT LEAST $380 MILLION IN MEDICAID DOLLARS TO SCHEMING SERVICE PROVIDERS
An America First approach to national security makes that clear.
The Trump administration has already begun laying the groundwork for this type of approach. Now, it just needs to see it through.
Fred Fleitz is a former chief of staff to the Trump National Security Council and a former CIA analyst. He is currently Vice Chair of the America First Policy Institute Center for American Security.