Press Releases

Today, the House Financial Services Subcommittee on Capital Markets, led by Chairman Ann Wagner (MO-02), examined measures to strengthen protections for Americans against financial fraud and scams.

On the Rising Threat of Financial Fraud:

Full Committee Chairman French Hill (AR-02) said, “Between 2020 and 2024, so since the pandemic, securities and investment fraud offenses have increased 25%. In 2024 alone, investors lost almost $6 billion to scams. Those are just the cases that we know about through reporting. Financial scams are becoming increasingly sophisticated, ranging from market manipulation, like pump and dump, to digital age Ponzi schemes and account takeovers. Unfortunately, seniors and retail investors are bearing the heaviest burden.”

Subcommittee on Digital Assets, Financial Technology, and Artificial Intelligence Chairman Bryan Steil (WI-01) said, “U.S. capital markets are the envy of the world. There's really no second when it comes to U.S. capital markets. They provide families with low-cost ways to save, to build wealth, and they give companies the opportunity to raise capital and create jobs here in the United States of America. Increasingly a lot of our capital markets are under threats from fraudsters and criminals, and a majority of Americans are encountering scams. The dollar amounts are staggering, in particular with our seniors. The FTC reported it was $16 billion. But if we assume that there's underreporting, which I think we all agree with, it's significantly higher than that. It's not a partisan issue. It's something we need to be working with broadly to prevent this from occurring.”

On Strengthening Efforts to Combat Fraud:

Subcommittee Chairman Ann Wagner said, "This is a global problem that calls for a multi-level, intergovernmental approach. That’s why I’m glad regulators and industry stakeholders have made this a top priority, including the SEC under Chairman Atkins, which has targeted malicious foreign actors through the Commission’s Cross-Border Task Force. Fighting fraud and exploitation is not a partisan issue, it’s about protecting the Main Street investors who put their trust in our capital markets.”

Homeland Security Committee Chairman Andrew Garbarino (NY-02) said, “The U.S. securities regulatory framework relies in part on self-regulatory organizations like FINRA, which operate under the oversight of the SEC. Unlike purely external regulators, FINRA has continuous access to firm level data, conducts routine examinations, and enforces compliance standards within broker dealers. That proximity allows for earlier detection of suspicious activity, faster intervention, and more practical insight into how fraud develops in real world marketing settings. It also positions FINRA as a first line of defense in identifying emerging risks before they escalate.”

On Emerging Risks in the Digital Asset Ecosystem:

Rep. Mike Lawler (NY-11) said, “Ramp-and-dump stock schemes frequently involve small Chinese companies listing on U.S. exchanges. Most use the variable interest entity structure, which gives shareholders interest in an offshore shell company rather than actual equity and rights.”

Witnesses Echoed the Work of the Committee:

Mr. Bryan Smith, Senior Vice President of Complex Investigations and Intelligence, FINRA said, “Investors, firms and markets are facing financial fraud threats that are unprecedented in scale and sophistication. Most U.S. adults report receiving scam messages on a daily or weekly basis, and over 40% of adults report that a scam email, text or call led them to give away personal information. The Federal Trade Commission (FTC) recently reported that customers suffered a staggering $15.9 billion in losses in fraud in 2025, a 35.5% increase from 2024.”

Ms. Jilenne Gunther, National Director of BankSafe Initiative, AARP said, “Scams are now a routine part of daily life for many Americans and an escalating concern for both consumer protection and national security. A majority of U.S. adults report encountering scam attempts on a regular basis, whether by phone (68%), email (63%), or text (61%), with about one in three also seeing them on social media. The impact is significant. Nearly half of adults say they have already taken some form of action in response to a scam, such as sharing personal information, sending money, or engaging with a fraudulent investment opportunity.”

Mr. Matthew Michel, Founder and Managing Partner, InvestorLink Capital Markets, LLC said, “Our current regulatory and compliance framework is fundamentally reactive; optimized to investigate fraud after the fact. It is not structured to enable proactive intervention, nor is it flexible enough to allow firms to safely adapt new tools and methodologies at the pace of evolving fraud. As a result, firms that seek to act on forward-looking intelligence face uncertainty about when and how they can do so without exposure to second-guessing.”

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