The morning before she spoke with PYMNTS CEO Karen Webster, Erin West took a call from a man in Arizona who had lost $4.5 million to an investment scam. He’d done everything a victim is told to do. He reported it to local police, to the FBI’s internet portal and to the Secret Service. What he got back was a case number. What he didn’t get was an investigation with any chance of finding his money.
The amount wasn’t the point. West, who is founder and president of Operation Shamrock, said the scammers took what he had because that’s what they always do.
“Whether it’s $4.5 million or $450,000 or $45,000, the scammer is going to take every penny that you have,” she said.
The Arizona man is far from alone. In July 2026, 21% of U.S. consumers, about 57 million people, said they had been the victim of a scam in the past five years. That’s according to “Fraud’s Loyalty Tax: How Scams Cost Banks Their Customers,” the first installment of the PYMNTS Intelligence Fraud Economy series. The report is based on a survey of 9,524 U.S. consumers.
Most losses are small. Half of victims lost $404 or less in their costliest scam. But the tail is long. The average loss was $9,734, and 1.1% of victims, still hundreds of thousands of people, lost $250,000 or more.
His case also fits a pattern in the data. Many scams move fast, and 43% of victims paid within an hour of first contact. Investment scams run on a slower clock. Only 37% of those victims paid within a day, because the scammers spend weeks building trust before they ask for money. Romance scams, which move slower still, are now the fastest-growing source of victims’ heaviest losses, up 22% since September 2025.
The problem, as West sees it, is that the system he reported to is built around him. His loss, his account, his case file. The people who robbed him aren’t organized that way at all.
Scam Compounds Are Companies With a Corporate Structure
West spent 26 years as a prosecutor and the last three of them working only on pig-butchering cases. She’s been inside scam compounds in Southeast Asia. What she found looks less like a gang and more like an industrial park.
An organized crime syndicate controls the building. Inside it, dozens of separate operations rent space and run their own books. Some specialize in Brazilians, some in Indian Americans, some in other populations. They operate across Myanmar, Laos and Cambodia, so when one country’s police shut down a location, another branch keeps working.
“What we know about what’s happening inside those compounds is the ‘corporateness’ of this,” West told Webster. “The organized crime syndicate is running the compound, but inside there are dozens and dozens of ‘companies.’”
Those companies have had years to refine their product. West described scammers as prepared, practiced and working from scripts that have already proven out.
“What we’re facing is a theft from the United States of a generation’s worth of wealth,” she said. “We’re talking about hundreds of billions of dollars.”
AI is entering the operation where it’s useful. Cloning voices, smoothing accents, generating deepfakes. West was cautious about claims that it has remade the compounds themselves. She did say it could change where the work happens. Big compounds can be found on a map. Work done from apartments and smaller sites can’t, which would make the business harder to see and harder to hit.
The Fraud Economy Has Suppliers, and They Aren’t All Criminals
The compounds also have an economy around them. Local residents clean, cook and run the convenience stores that serve them. The bosses spend at restaurants, shops and entertainment venues.
“When you have a massive scam center in a location, there is definitely an economy that develops outside that scam center to support the big bosses,” West said. “When you shut down a scam compound, that is very disruptive to local economy.”
That’s the local supply chain. The global one is bigger and mostly legitimate. A scam operation needs phone numbers, social media accounts, messaging apps, bank accounts, crypto rails and a way to move stolen money across borders. Every one of those is a service someone provides.
Webster framed the question that follows from that.
“How do we actually shrink the GDP of the fraud economy?”
Nobody’s Job Is to Shrink It, so West Made It Hers
The honest answer is that no one is assigned to it. A bank sees a suspicious wire. A platform sees a fake profile. A local detective sees a resident who lost his savings. Each one handles its piece, and the enterprise that connects the pieces goes untouched.
Operation Shamrock exists to fill that gap.
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“The mission of Operation Shamrock is to educate about, mobilize against and disrupt transnational organized crime,” West said.
Disruption, in her framing, means going after dependencies. Banks, technology companies and telecom providers each control something the operators can’t run without.
“How do we shut down their telco?” she said. “How do we make it more difficult for them to get on these social media platforms?”
That work starts with data, and West said that the data is bad. Fraud is badly underreported, West said, so authorities don’t have a baseline to measure the problem against or a way to tell whether anything they do is working. She wants a shared capability where public agencies and private companies pool what they know. Payment data shows where the money goes. Platform data connects accounts that look unrelated one victim at a time. International pressure closes the exits.
The PYMNTS Intelligence data on fraud reporting shows how wide the reporting gap has become. The share of victims who didn’t report their scam at all grew 26% in the past year, to 11%. The most common reason, cited by 28% of non-reporters, was not knowing that reporting was an option. Another 18% said they got no clear guidance on how to file, the fastest-growing barrier in the survey. Romance scam victims were the most likely to stay silent. Forty percent told no one at all.
That silence has a cost for victims, too. Only 8.1% of those who didn’t report got all their money back.
One Victim’s Case Is a Thread, Not a Dead End
West rejected the idea that the cases themselves are hopeless because the criminals are overseas.
Go back to Arizona. The scam started with a contact. An Instagram profile, a LinkedIn account, a WhatsApp number. Each one produces records. Those records lead to another person, a shell company or a cloud account full of photographs and identifying details.
“If you keep pulling those threads, you can identify people,” West said.
What’s missing is the capacity to pull them at scale. A local agency can’t build deep expertise across thousands of complex international cases. Federal analysts could aggregate those cases and go after the shared infrastructure, the same actors and the same money routes that show up again and again. That’s how you investigate a business instead of a burglary.
“We need to be thinking three or four steps ahead,” she said.
Banks are part of that equation whether they want to be or not. Victims who reported a scam to their financial institution were the most likely to recover their money, according to the PYMNTS Intelligence report. Forty-two percent got all of it back, compared with 20% of those who reported through channels outside the bank, like the police and federal portals the Arizona man turned to. And 79% of fraud victims who recovered any money got it back through their bank.
How a bank handles a scam also shapes whether the customer stays. Seventeen percent of victims said they had already switched financial providers because of a scam. Another 28% said they were likely to switch their primary account in the next 12 months, rising to 41% among those who lost more than $5,000. Among likely switchers, 31% cited concerns about how well their institution protects them from fraud, and 30% pointed to how it handled or would handle a fraud or scam issue.
Watch the full interview with Erin West to learn more about:
- What West saw inside Southeast Asian scam compounds, including how workers are recruited, controlled and financially penalized.
- Why one victim’s social media, messaging and transaction records can lead investigators into a much larger organization.
- How incomplete fraud reporting leaves banks and law enforcement unable to connect victims, money flows and networks.
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