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Scams, Trust and the Cost of Digital Growth
Online scams are no longer a side effect of digital growth. With more than half of adults worldwide reporting scam encounters and losses exceeding USD1 trillion a year, fraud has become a systemic economic risk.
A phone number. A spoofed sender ID. A perfectly “legitimate” bank transfer authorized by the victim themselves. By the time anyone realizes it was a scam, the money has usually moved across borders and out of reach.
This is the new geometry of fraud. As APEC ministers, officials and industry leaders gather in Chengdu for the APEC Digital Weeks, including the Digital and AI Ministerial Meeting, the challenge has become increasingly difficult to ignore.
Earlier this year, those questions were already taking center stage at the APEC Combatting Online Fraud and Scams Workshop in Guangzhou, where regulators and private-sector leaders examined how trust itself can be engineered, packaged and monetized at scale.
The scale of the problem has made that shift unavoidable. According to the Global Anti-Scam Alliance, more than half of adults worldwide encountered a scam in the past year, and nearly one in four lost money. Taken together with the alliance’s estimate that , the figures point beyond financial loss to a steady erosion of confidence in everyday digital exchange.
From nuisance crime to organised industry
In opening remarks, Alex Parle, Executive Vice President of the National Center for APEC, set the tone. Scammers, he said, should be understood as “an organised transnational criminal industry, not a collection of isolated bad actors.”
What distinguishes today’s scam economy is not just volume, but structure. Operations are segmented and scalable, using scripts, data analytics and increasingly artificial intelligence to refine deception. They exploit infrastructure built for digital activity, such as telecommunications networks, online platforms and payment rails, while leaving consumers to shoulder much of the detection burden.
That shift matters for economic policy. When consumers hesitate over whether a message, e-commerce listing or payment request is genuine, participation drops. Small and medium-sized enterprises are often the first to pull back. Without dedicated fraud teams or financial buffers, a single incident can derail online expansion altogether.
Why scams slip through the system
The first panel, on finance, explored why modern scams are so difficult to stop once they are in motion. Wanjing Ji, Visa’s Asia Pacific Head of Ecosystem Risk, drew a clear distinction between traditional fraud and scams, two terms often blurred in public debate.
Fraud typically involves unauthorised transactions, where credentials are stolen and victims are unaware. Scams work differently. Victims are manipulated into approving the payment themselves, often under pressure or fear. From the system’s perspective, the scam hides inside what often looks like a perfectly legitimate payment.
That distinction has profound implications. Ji described a scam ecosystem that now resembles a supply chain: compromised personal data and social engineering at the front end, mule accounts and laundering routes at the back end, with constant testing and optimisation in between.
As cross-border threats in the form of fraud and scams continue to evolve faster than ever, becoming smarter, more global and increasingly complex, the approach to combat threats should be two-pronged; cross-border collaboration and leveraging technological innovation.
Firstly, a whole of ecosystem approach with collaboration across multiple parties and economies becomes critical to strengthen defences to outpace increasingly sophisticated criminal networks. Secondly, leveraging technological innovation such as (generative) AI to detect risk in real time and tokenisation to reduce the value of stolen data creates layered protection while improving the collective ability to stop criminals, and where possible, bring them to justice.
The same theme surfaced in discussion with Justin Liu, Head of PayPal Greater China Government Affairs and Public Policy, and Stanley Wu, Head of Financial Crime Compliance for Hong Kong at Standard Chartered Bank. Both stressed that responsibility for prevention has become widely distributed across platforms, telecom operators and financial institutions, while coordination has not kept pace.
Liu emphasized that action now needs to accelerate on three fronts: deeper public-private collaboration, stronger government-to-government interoperability and timely, privacy-preserving intelligence sharing across industries. Without those elements, he suggested, even the best safeguards remain fragmented.
Wu offered a practical example from Hong Kong, where recent legal changes have enabled banks to share information on suspected mule accounts, disrupting scams at the stage where money is moved and laundered.
The lesson for APEC economies was not about copying a single model, but about recognizing what makes prevention possible, including legal gateways for cooperation, clarity on when and how to act, and incentives that reward early intervention rather than post-loss accounting or blame.
Telecoms: the front line that consumers cannot see
If finance is where the money moves, telecoms is often where the scam begins. Panel two addressed this uncomfortable reality, as Daryl Teo, Economics Strategy Manager from Access Partnership noted, while voice calls and SMS have become legacy revenue channels for telcos, they remain primary vectors for criminal reach.
Singapore’s experience loomed large. Public reporting in Singapore found scam losses reached a record SGD1.1 billion in 2024. That kind of number has forced a rethink of what “consumer protection” means in an always-on communications environment.
Sunup Park, Deputy Director at Korea’s Personal Information Protection Commission (PIPC), tackled a different constraint: privacy law. Korea’s approach, he said, is built on the idea that privacy protection and innovation are not a zero-sum trade-off. He described how inter-agency cooperation, a regulatory sandbox, and advance compliance engagement have been used to support AI-based voice-phishing detection while addressing legal uncertainty around personal data use.
Evelyn Goh, Director of International Relations, Policy and Strategy of Singapore’s Infocomm Media Development Authority (IMDA) brought a regional lens to the discussion, pointing to the ASEAN Guide on Anti-Scam Policy and Best Practices which was endorsed at the 6th ASEAN Digital Ministers’ Meeting. The guide provides practical guidance for policymakers, regulators and telecommunications industry players to adopt recommended anti-scam measures to enhance the region’s capabilities to combat scam calls and SMSs.
This is also where evidence of “what works” starts to look tangible. IMDA’s materials describe Singapore’s SMS Sender ID Registry as one upstream measure to curb spoofing and protect users from fraudulent sender IDs.
Platforms, persuasion and the limits of vigilance
The final panel turned to digital platforms, which spoke to a range of businesses from social media to e-commerce platforms, where scams can scale rapidly through impersonation, fraudulent advertising and online marketplace abuse. What emerged was less a technology debate than a discussion about persuasion.
Andrei Skorobogatov, Director of Policy of the Global Anti-Scam Alliance described modern scams as crimes of communication rather than code. The initial contact often happens through paid advertising or social feeds. The grooming unfolds in private messages. By the time a victim is asked to move money, trust has already been carefully constructed.
That observation reframed the role of platforms. Moderation, identity checks and advertising controls were framed as part of consumer protection, alongside their role in content governance. Speakers noted that scams increasingly draw on emotional triggers such as fear, urgency and authority, with artificial intelligence enabling impersonation at scale.
Jennifer Chien, Economic Policy Manager of Meta Asia-Pacific described an “extremely adversarial” environment, where scam operators iterate rapidly and exploit regulatory gaps between jurisdictions. She emphasized the importance of
No silver bullet, but a clearer direction
The workshop did not offer the comfort of a single solution, and that absence was telling. What it did provide was a clearer sense of direction for APEC economies grappling with the same pressures.
Scams are increasingly understood as a cross-border systems risk rather than a failure of individual judgment, government jurisdiction, or business sector. Effective responses depend on cross-border legal and operational pathways that allow information to move quickly and in good faith across sectors. Safeguards work best when they are layered and outcome-focused, reducing scam reach without locking in specific technologies that may age quickly.
Public messaging also needs to evolve, moving beyond simple warnings to reflect how modern scams exploit fear, authority and artificial intelligence to bypass vigilance. Public and private sector collaboration is key, especially to create real world consequences for criminal organizations.
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This feature article can also be viewed on the APEC website:
https://www.apec.org/press/
