Cyber "Privateers" Get Constitutional Nod to Hunt Global Scam Syndicates

Representative David Schweikert (AZ-01) has introduced the Cybercrime Marque and Reprisal Authorization Act of 2025 (H.R. 4988), which seeks to modernize the use of letters of marque and reprisal under Article I, Section 8 of the U.S. Constitution. The proposed legislation would empower the executive branch to license cyber operators to combat foreign cybercriminal enterprises that threaten U.S. citizens and infrastructure. These operators would be tasked with recovering stolen assets, preventing future attacks, and defending critical systems, all under federal oversight [1].

The bill reflects a growing concern over the rise in cybercrime. According to the FBI’s 2024 Internet Crime Report, U.S. victims reported over 859,000 complaints, amounting to $16 billion in losses, with a 33 percent increase in losses since 2023. Older Americans have been particularly vulnerable, with nearly $5 billion in reported financial damages. Many of these attacks stem from sophisticated "scam farms" in countries such as Myanmar and North Korea, where operations are often state-linked and designed to infiltrate U.S. digital systems [1].

The concept of letters of marque and reprisal dates back to the early days of the United States and played a key role in maritime defense during conflicts such as the American Revolution and the War of 1812. This constitutional authority was last used during World War II when a Goodyear blimp was commissioned for anti-submarine patrols off the California coast. Schweikert argues that this historical mechanism can now be adapted to address the modern threat of cybercrime by leveraging private innovation and constitutional authority [1].

The proposal also aligns with ongoing legislative and policy discussions about combating financial crime. In the U.S. Senate, four anti-money laundering (AML) bills are expected to be considered following the summer recess. Among these, H.R. 2384, the Financial Technology Protection Act, would establish an independent working group to assess how terrorist financiers and money launderers use cryptocurrency and recommend regulatory updates. Meanwhile, the Combating Money Laundering in Cyber Crime Act, reintroduced by Senators Catherine Cortez Masto and Chuck Grassley, aims to strengthen the Secret Service’s ability to detect and deter digital asset-related criminal activity [2].

The U.S. Department of Justice (DOJ) has also signaled a shift in its approach to cryptocurrency enforcement. Acting Assistant Attorney General Matthew Galeotti stated that the DOJ will move away from prosecuting software developers for failure to register as money transmitters, provided they create code without criminal intent. This marks a significant departure from earlier enforcement strategies and suggests a broader regulatory easing toward the crypto sector. However, recent high-profile cases, such as the Tornado Cash co-founder trial, illustrate the ongoing debate over the role of decentralized technologies in enabling illicit financial activity [3].

Globally, the financial architecture behind cyber scams is complex and multi-layered. A report from the Global Initiative on Transnational Organized Crime highlights how cyber scam operations in Southeast Asia rely on trafficking, financial fraud, and professional money laundering networks. Funds are moved through gateway companies, mule accounts, DeFi applications, and crypto exchanges, making illicit proceeds difficult to trace. While cryptocurrencies are widely used, traditional payment mechanisms such as cash, bank transfers, and fintech apps also play a role, often facilitated by regulatory loopholes and political influence [4].

Scam centers are proliferating across regions, particularly in Southeast Asia and West Africa, where organized crime groups traffic victims to operate cybercriminal enterprises. According to Interpol, scam centres have been observed in 66 countries as of March 2025, with Nigeria emerging as a potential hotspot. These operations often target victims outside the countries in which they are based, exploiting weak governance and porous borders to avoid detection. The United States appears to be a primary target, with one scam centre leader stating that the country is prioritized due to its wealth [5].

Source:

[1] Schweikert Introduces Cybercrime Marque and Reprisal Authorization Act to Combat Foreign Scam Syndicates (https://schweikert.house.gov/2025/08/20/schweikert-introduces-cybercrime-marque-and-reprisal-authorization-act-to-combat-foreign-scam-syndicates/)

[2] AML Bills on Deck in Senate After Summer Recess (https://www.moneylaundering.com/news/aml-bills-on-deck-in-senate-after-summer-recess/)

[3] US DOJ to Back Off Money Transmitter Cases in Shift Backed by Crypto (https://www.reuters.com/sustainability/boards-policy-regulation/us-doj-back-off-money-transmitter-cases-shift-backed-by-crypto-2025-08-21/)

[4] The Economics of Cyber Scam Operations in Southeast Asia (https://globalinitiative.net/analysis/cyber-scam-operations-southeast-asia/)

[5] Global | Scam Centres Driving Cybercrime Globally (https://dragonflyintelligence.com/news/global-scam-centres-driving-cybercrime-globally/)