Paris, 5 November 2026 — The Financial Action Task Force (FATF) has called for a coordinated global crackdown on scam compounds, warning that the criminal networks behind them are among the fastest-growing forms of organised crime in the world and cost victims tens of billions of dollars every year.
In a landmark report published on Wednesday, Combating End-to-End Illicit Financial Flows Linked to Scam Compounds, the Paris-based watchdog follows the money through the integrated criminal business models that sustain the compounds — and sets out how governments, banks, technology companies and telecoms providers should work together to dismantle them.
The report is the first output of the FATF's broader anti-fraud roadmap, agreed under the UK presidency of the task force, and draws on almost 120 case studies from more than 60 jurisdictions. Its message is blunt: chasing individual scam payments after the money has moved is no longer enough. Countries must also attack the infrastructure — the recruiters, the payment channels, the technology and the criminal leadership — that keeps the compounds running.
The scale of the problem
Scam compounds, or related activity, have been documented in jurisdictions across Africa, Europe, the Americas and Asia, according to the report. The most extensively documented model remains the large physical compound in Southeast Asia, where people are trafficked into guarded sites and forced to run online fraud — romance scams, fake investment schemes and cryptocurrency fraud — against victims on the other side of the world.
The human cost on both sides is stark. People from at least 80 jurisdictions have been identified in scam compounds in Southeast Asia, with an estimated 120,000 forced to carry out online scams in Myanmar alone. Those trafficked into the operations may be recruited through fraudulent job offers, transported across borders and subjected to debt bondage, confinement, violence, sexual exploitation, torture and threats. On the other end, people from more than 100 jurisdictions have been targeted — and once funds are cashed out, moved offshore or converted into virtual assets, victims' losses are usually irrecoverable.
The two sides of one crime. A scam compound is simultaneously a fraud operation and a human-trafficking operation. The same networks that defraud victims abroad also recruit, transport and coerce the workers who run the scams — which is why the FATF's principles insist that investigations protect both scam victims and the people trafficked into the compounds.
How the money moves
The report maps the financial and non-financial infrastructure on which the criminal networks depend. Operators move and launder proceeds through cash, money mule accounts, informal transfer services and virtual assets — and the FATF identifies virtual assets as a central money-laundering channel. In one case, blockchain analysis mapped more than USD 100 million in victim inflows to a single wallet cluster attributed to a scam compound, and dedicated over-the-counter exchange desks have been found operating inside compounds.
Speed is the networks' greatest advantage. Instant payment platforms are exploited to move scam-generated funds from a victim's account in as little as two minutes, the report says. Mobile devices, social media and messaging apps have widened the networks' reach, while AI-enabled content, deepfakes and automation are cutting the cost of running scams and making them harder for victims to spot.
Enforcement is also changing the shape of the problem: crackdowns on large compounds have prompted operators to shift towards smaller and more mobile operations, repurposing casinos, rented rooms, coffee shops and even moving vehicles to conduct online fraud.
"With criminals weaponising AI and other technologies to intensify their scam operations, we need to urgently modernise and accelerate our response. This means focusing on dismantling the criminal networks behind scam compounds, working proactively with technology, social media and communications sectors to prevent and disrupt more scams before they happen, and quicker intervention to freeze and seize the proceeds of scams once they've happened."
— Giles Thomson, President of the FATF
What the FATF wants countries to do
The report finds that countries are currently more effective at the downstream end of the problem — targeting victim payments, proceeds and asset tracing — than at stopping scams upstream. It calls on them to combine downstream action with upstream disruption of the wider criminal infrastructure, catching fraud before a payment is ever made by spotting early signals such as fraudulent advertising, recruitment activity, malicious domains and suspicious phone numbers.
To step up disruption worldwide, the FATF has launched a set of principles on combating illicit financial flows linked to scam compounds:
| Principle | What it means in practice |
|---|---|
| Target the wider criminal ecosystem | Focus on criminal leadership, recruitment and trafficking networks — not just the physical compound. |
| Disrupt illicit financial flows end-to-end | Attack the infrastructure that enables scams, while stopping, tracing, freezing and recovering victim payments. |
| Connect the networks | Share information across financial institutions, technology companies, telecoms providers and authorities. |
| Act at speed across borders | The first 24–72 hours after a scam is detected or reported are critical for freezing funds. |
| Put victims at the centre | Protect both scam victims and people trafficked into compounds, with safeguards, support and reporting mechanisms. |
| Adapt and focus on lasting impact | Keep updating approaches as scam operations decentralise, relocate and rebrand. |
The cases that show disruption can work
The report's case studies are proof that coordinated action gets results. Three examples stand out:
- United States: the interagency Scam Centre Strike Force's Disruption Week disrupted approximately 1.4 million social media and email accounts and malicious network infrastructure, supported arrests in Thailand and led to the freezing of more than USD 3.8 million in virtual assets.
- Indonesia: the Indonesia Anti-Scam Centre blocked more than 515,000 accounts and returned approximately USD 10.9 million to victims between November 2024 and May 2026.
- United Kingdom: the Scam Signals partnership, covering 85% of the UK's mobile users, gives banks real-time mobile-network risk indicators as a customer authorises a payment. Its use has been associated with a 41% reduction in people scammed and a 44% decrease in fraud losses — an association the FATF reports carefully, rather than a proven causal link.
Frequently asked questions
What is a scam compound?
A site — often a guarded compound, but increasingly a smaller or mobile location — where workers, many of them trafficked and coerced, run large-scale online fraud against victims in other countries. The FATF calls them integrated criminal enterprises that generate illicit funds and launder them in-house.
How big is the problem?
Scam compounds cause tens of billions of dollars of losses every year, the FATF estimates. People from more than 100 jurisdictions have been targeted, and people from at least 80 jurisdictions have been identified working in compounds in Southeast Asia.
Why are virtual assets so central to the report?
They are the main channel through which scam proceeds are moved and laundered. In one case, investigators traced more than USD 100 million in victim funds to a single wallet cluster linked to one compound, and some compounds run their own over-the-counter crypto exchange desks.
Key takeaways
- The FATF calls scam compounds one of the most rapidly expanding forms of organised crime, costing victims tens of billions of dollars a year.
- An estimated 120,000 people are forced to run online scams in Myanmar alone, while victims span more than 100 jurisdictions.
- Virtual assets are the central money-laundering channel; in one case, over USD 100 million in victim funds was traced to a single wallet cluster.
- Countries must combine action on payments with upstream disruption of the criminal infrastructure — and act within 24–72 hours of a scam being reported.
- Case studies from the US, Indonesia and the UK show coordinated disruption works; the FATF will develop scalable solutions with the private sector through February 2027.
The test of the report will be whether its principles turn into action. The FATF's case studies show that when banks, telecoms firms, technology companies and law enforcement move together — and move fast — scam networks can be disrupted and victims' money recovered. The next phase of the roadmap, running to February 2027, will show whether that cooperation can be scaled into a sustained global response.
