STATE DEPARTMENT SAYS TRUMP RAISED TRANSNATIONAL CRIMINAL ORGANIZATIONS WITH XI AS GLOBAL CYBER SCAM NETWORKS EXPAND

WASHINGTON — A senior State Department official told the Senate Foreign Relations Committee that President Donald Trump raised transnational criminal organizations with Chinese President Xi Jinping as the United States intensifies its response to cyber scam compounds targeting Americans.

Michael DeSombre, assistant secretary of State for East Asian and Pacific Affairs, made the statement Thursday during a full committee hearing titled “Protecting Americans from Global Scam Operations: Assessing the U.S. Response.”

U.S. Sen. Jeanne Shaheen of New Hampshire asked DeSombre whether scam compounds had been discussed with senior Chinese government officials.

Trump “has raised transnational criminal organizations with President Xi,” DeSombre responded.

The answer confirmed that the broader threat posed by transnational criminal networks reached the presidential level. DeSombre did not identify when the discussion occurred, provide additional details about what Trump said or disclose how Xi responded.

Cyber scam compounds have developed into a large international industry built around fraud, human trafficking, cryptocurrency laundering and cyber-enabled theft. Many operate from guarded facilities where workers conduct romance scams, fraudulent investment schemes and other forms of deception against people located thousands of miles away.

Burma, Cambodia and Laos remain central locations for the compounds, although State Department officials warned that the criminal model is spreading into South Asia, the Middle East, Africa, the Pacific and the Western Hemisphere.

Chinese-origin transnational criminal organizations are the primary force driving the scam economy in Southeast Asia, according to DeSombre’s testimony. Leadership positions within many of the organizations are held by Chinese nationals, while the compounds use workers recruited from numerous countries.

Some workers knowingly participate in the fraud. Others are trafficking victims who were deceived by false employment offers, transported across borders and forced to commit scams under threats, confinement or violence.

The number of people subjected to forced criminality inside scam centers across Burma, Cambodia and Laos may reach hundreds of thousands each year. State Department testimony described an industry supported by its own leadership, labor force, technological infrastructure, financial channels and international supply chains.

The operations target Americans across every income level, age group and state. The State Department’s initial estimate placed reported American losses from Southeast Asia-based scams at approximately $12.5 billion during 2025, with officials expecting the final figure to be substantially higher.

DeSombre testified that cyber scam organizations may have caused up to $114 billion in losses across East Asia and Pacific countries during the same year. The financial damage inflicted upon Americans in 2025 was approximately three times the level recorded in 2023.

Chinese authorities have taken stronger action against some scam networks during the past six months. DeSombre told the committee that those efforts had reduced the number of scam compounds operating in parts of Cambodia and Myanmar.

“I think our understanding is much of that has been driven by Chinese desire, as those scam compounds had been targeting Chinese nationals,” DeSombre said.

The expansion of the victim pool has created a shared interest among countries whose citizens are being targeted. China and other governments now face domestic pressure to disrupt organizations that previously concentrated much of their activity against victims in foreign countries.

“So I think one of the benefits, shall we say, of the expansive or the expanding nature of the targeting out of the scam compounds is that they’ve been targeting many more countries, and those countries, including China, are now much more willing to work with us to try to go after these scam compounds,” DeSombre said.

Questions remain over whether Chinese enforcement actions will reach organizations targeting Americans with the same intensity applied to groups defrauding Chinese citizens. U.S. officials are also concerned about what happens when suspected scam leaders are returned to China before American investigators can interview them or collect intelligence about their organizations.

DeSombre said the United States and its partners are pressing Southeast Asian governments to provide investigators with access to suspected scam leaders rather than immediately returning them to China.

The objective is to identify senior leadership, financial networks, recruiters, technological systems, corrupt facilitators and other individuals responsible for sustaining the compounds.

“When they are sent back to China, we don’t have great transparency as to what happens to them,” DeSombre told senators. “Some of them may be incarcerated, and others may not. We don’t have that transparency.”

He said the issue remains part of the continuing diplomatic relationship between Washington and Beijing.

“It is a topic that we discuss with China and will continue discussing with China,” DeSombre said. He added that the FBI has made efforts to work with China’s Ministry of Public Security and presumed the organizations were discussing scam-compound activity.

DeSombre testified that the United States is pressing Cambodia, Burma and Laos to pursue the bosses and financiers behind the criminal networks rather than limiting enforcement to low-level workers or individual buildings.

Raiding a compound can temporarily disrupt its operations without dismantling the organization controlling it. State Department officials warned that some groups closed in one location have reappeared elsewhere or divided their operations among hotels, residences and smaller facilities that are more difficult for law enforcement to detect.

President Trump signed Executive Order 14390 on March 6, 2026, directing a coordinated federal response to cybercrime, cyber-enabled fraud and financially motivated sextortion targeting Americans.

The order instructed the departments of State, Treasury, War and Homeland Security, along with the Justice Department, to develop a plan for identifying, disrupting and dismantling the organizations responsible.

The strategy targets more than physical compounds. Federal agencies are seeking to disrupt leadership structures, financial flows, communications networks, recruitment systems, digital infrastructure and the professional facilitators who allow stolen money to move between countries.

Those facilitators can include corrupt officials, accountants, attorneys, bankers and cryptocurrency converters. Their services allow criminal organizations to receive payments, hide ownership, move proceeds and continue operating across jurisdictional boundaries.

DeSombre said Secretary of State Marco Rubio announced a new visa-restriction policy on July 23 targeting individuals connected to cybercrime and cyber-enabled offenses, including scam centers and sextortion.

Rubio also raised the scam-center threat during a July meeting with Cambodian Deputy Prime Minister and Foreign Minister Prak Sokhonn. Cambodia remains a central focus because of the number of criminal compounds operating within the country and the need for stronger action against senior leaders.

The United States has also formed a 13-country Counter-Scams Contact Group with allies and partners affected by the threat. Participants include Australia, Canada, Indonesia, Japan, Malaysia, New Zealand, the Philippines, South Korea, Singapore, Thailand, the United Kingdom and Vietnam.

The group is intended to strengthen cooperation involving arrests, intelligence sharing, asset seizures, sanctions, financial disruption and diplomatic pressure against countries or individuals providing safe haven to scam networks.

David Bedard, deputy assistant secretary of State for the Bureau of International Narcotics and Law Enforcement Affairs, told the committee that American law enforcement has gained unprecedented access to evidence recovered from scam operations near the border between Thailand and Myanmar.

Beginning in October 2025, the bureau funded FBI deployments to Thailand following the evacuation of thousands of workers from compounds in Myanmar. American personnel worked with the Royal Thai Police and Thailand’s Anti-Cyber Scam Center to support cases connected to United States victims.

Investigators interviewed people emerging directly from the compounds and collected information about leadership, recruitment, coercion, financial operations and the techniques used to deceive victims.

FBI and Thai personnel examined more than 8,000 mobile phones and 1,500 computer hard drives recovered during the operations. The digital evidence allowed investigators to compare witness accounts against information taken directly from devices used within the compounds.

Bedard said that cooperation supported multiple federal indictments and arrests targeting scam leaders and facilitators. It also provided American authorities with a clearer understanding of how the compounds recruit workers, select victims, transfer money and maintain operations across several countries.

State Department officials warned that stronger enforcement in Southeast Asia could push parts of the industry into new regions rather than eliminate it. Criminal organizations can relocate workers, reuse scripts and transfer digital infrastructure without rebuilding the large compounds traditionally associated with the industry.

U.S. Sen. Tim Kaine of Virginia questioned whether pressure in Southeast Asia was contributing to the movement of scam operations into the Western Hemisphere. He cited cases uncovered since 2023 in Peru, the Dominican Republic and other countries.

Bedard said the threat already extends well beyond one region. Romance scams have operated from Nigeria and Côte d’Ivoire, call-center schemes from India, lottery scams from Jamaica and timeshare fraud from countries across South America. Officials have also identified concerns involving scam centers in Sri Lanka.

The growing danger is not limited to the relocation of individual criminals. The operational methods refined by Chinese transnational criminal organizations in Southeast Asia can be copied, sold or transferred to groups operating elsewhere.

Those methods include scripted psychological manipulation, false investment platforms, cryptocurrency laundering, fraudulent employment recruitment, digital surveillance of captive workers and the division of criminal tasks among specialized teams.

The global expansion makes jurisdiction one of the greatest obstacles confronting investigators. Scam operators can be located in one country, traffic workers from another, communicate with victims in the United States and move stolen funds through financial accounts or cryptocurrency services spread across several additional jurisdictions.

National law enforcement authority ends at borders, while the criminal organization can move across them. The State Department’s response is intended to narrow that advantage through diplomatic pressure, foreign police partnerships, intelligence sharing, extradition efforts, sanctions, visa restrictions and financial enforcement.

The testimony established that the scam-compound threat is now part of direct discussions between the United States and China, including engagement at the presidential level. It also showed that cooperation with Beijing remains limited by concerns over selective enforcement, access to suspects and the lack of transparency surrounding individuals returned to Chinese custody.

American officials are now seeking to dismantle the entire system supporting the compounds rather than measuring success solely by the number of buildings raided or workers removed. The central objective is to reach the bosses, financiers and international facilitators who can reopen operations elsewhere when a single compound is closed.

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