TL;DR
- Crypto-enabled fraud cost victims at least $14 billion globally in 2025, with sophisticated scams like pig butchering and AI-powered social engineering reshaping the threat landscape.
- The UK is investing over £150 million to transform Action Fraud into a new National Fraud and Cyber Crime Reporting service.
- Project WINTERPROOF, led by the National Economic Crime Centre (NECC), focuses on fighting fraudsters with an overseas nexus who target the UK. With data showing 75% of all fraud against UK individuals and businesses is either instigated or facilitated from abroad, the project emphasises international collaboration with law enforcement agencies in high-risk jurisdictions to disrupt criminal groups engaged in high-harm frauds.
- New regulations place unprecedented responsibility on financial institutions and crypto businesses to prevent fraud, creating opportunities for AI-powered prevention tools to transform the industry approach from reactive to proactive.
Fraud isn’t what it used to be. In 2025 alone, Chainalysis identified that at least $14 billion in cryptocurrency was transferred to addresses associated with scams and fraud. Today’s fraud landscape is dominated by industrial-scale syndicates spanning Southeast Asian scam compounds, West African cybercrime hubs, Eastern European fraud rings, and more. These sophisticated operations are staffed by trafficked workers, leverage AI-generated content, and exploit crypto assets to move illicit funds globally within seconds.
We now face a breed of criminal enterprise that’s well-connected, cyber-enabled, and evolving faster than our defences, transforming into one of the most pressing global security threats. Most acknowledge that the response to fraud needs to use different levers — legislation, education, enforcement — but in every effective solution, innovation is front and centre.
While traditional awareness campaigns continue to be important, the criminals aren’t the only ones with new tools. AI-powered prevention technology that can identify and stop fraud at the point of transaction, blockchain analytics that can trace criminal proceeds across borders in real-time, and predictive intelligence that disrupts operations before they reach victims are now essential. But technology alone is not enough without strategic leadership and international coordination.
The UK government has made tackling fraud a core policy priority, recognising it as a growing and fundamentally transnational threat. This was underscored in 2024, when the UK hosted the first Global Fraud Summit, which convened G7 governments, law enforcement, and industry to define a shared international response. As attention turns to the second summit, hosted by UNODC in Vienna with continued UK support, the UK’s approach offers a timely case study in how domestic reform and global collaboration can reinforce one another.
From Whitehall to the world: Tackling fraud at source
Although fraud accounts for over 40% of all crime in the UK, with estimates of annual losses at £219 billion in 2023, it has historically received less than 1% of policing resources. The UK has acknowledged that fraud cannot only be fought domestically, with official estimates suggesting that 75% of UK fraud has hallmarks of overseas involvement.
Cryptocurrency has become central to this threat: City of London Police reported that crypto plays a role in two-thirds of all reported investment fraud. In the last iteration of their approach to fraud, The 2023 Fraud Strategy, the UK government reconceptualised fraud as a global threat requiring a global response.
The National Crime Agency (NCA) has recently taken direct action to address this growing threat, launching its first-ever campaign specifically targeting crypto investment fraud. The initiative focuses particularly on men under 45, who data shows are the most frequent victims, with over 17,000 reports submitted to Action Fraud by UK victims in 2024 alone.
The UK has already demonstrated what sophisticated, technology-enabled disruption looks like on a domestic level. Operation Elaborate, which dismantled the iSpoof platform, showed how blockchain analysis can be instrumental in taking down fraud infrastructure at scale. The platform had enabled criminals to make more than 10 million fraudulent calls to UK victims. More recently, the Metropolitan Police’s seizure of over £5 billion worth of cryptocurrency in a massive fraud investigation represents one of the largest asset recoveries in law enforcement history, demonstrating the importance of using blockchain analytics to track the proceeds of crime.
Looking overseas, Project WINTERPROOF, led by the National Crime Agency (NCA) and supported by the Home Office and Foreign, Commonwealth & Development Office, is focused on disrupting fraud by building capacity for crypto analysis within law enforcement and other government agencies inside the countries where scam operations are based.
Within this capacity-building programme, there is a real opportunity to develop expertise with tools that are at the forefront of the fight against fraud. Crypto asset tracing, for example, provides insight that traditional fraud investigation rarely has: visibility into the money trail across borders. When UK victims send cryptocurrency to a scam operation overseas, Chainalysis can follow that money as it moves through mixers and across blockchains to exchanges and other cash-out points. That intelligence can then be used to inform sanctions designations, focus mutual legal assistance requests, and target coordinated enforcement actions between partner countries.
The joint UK-US sanctions actions in October 2024 against scam syndicates operating in Southeast Asia, and the more recent joint action against the Prince Group and Huione Group for their roles in scam infrastructure and the laundering of proceeds, demonstrated this approach. By combining financial intelligence, crypto tracing, and diplomatic pressure, the UK showed that geography is no longer the shield it once was for fraudsters.
Transforming the response to fraud
The UK is undergoing a significant transformation in its approach to fraud policing. The creation of the National Fraud Squad with approximately 400 dedicated officers addresses the resource imbalance head-on. But more important than the number of officers is how they’re working.
The replacement of Action Fraud with Report Fraud, a new National Fraud and Cyber Crime Reporting run service, represents a shift toward intelligence-led, data-driven investigation. This system is designed to rapidly triage reports, identify patterns, and generate actionable intelligence for law enforcement.
Under this new system, where fraud reports include cryptocurrency addresses, blockchain data can instantly connect seemingly isolated cases to map out illicit networks, identify the infrastructure behind scam operations, and generate leads for asset seizure and disruption. A single cryptocurrency address might appear in dozens or hundreds of victim reports; connecting those dots manually would take months. With the right tools, it will take only minutes.
The power of blockchain intelligence extends far beyond just tracking victim flows—a single cryptocurrency address can often serve as an entry point for mapping entire criminal ecosystems. Investigators and compliance teams can simultaneously trace funds to reveal perpetrator networks, identify broader money laundering infrastructure, and discover additional victims who may not have reported their losses. This multi-layered intelligence picture enables targeted disruption at various levels of criminal operations, from sanctioning kingpins to freezing assets at exchanges.
Law enforcement agencies could leverage these same capabilities alongside the new powers provided by the Online Safety Act. By using blockchain analytics to identify scam-linked domains and infrastructure, authorities can transition from reactive takedowns to the systematic disruption of scam operations’ financial infrastructure.
Elevating fraud to a national security threat reflects a recognition that organised fraud at this scale undermines economic stability, public confidence in institutions, and international security. Treating it as such means dedicating serious resources, sophisticated technology, and strategic thinking to the problem.
Private sector accountability: Prevention over reaction
Among the developments in the UK’s approach has been a shift of responsibility to private-sector firms to prevent fraud, rather than just report it after the fact.
The APP Fraud Mandatory Reimbursement Model, which requires payment providers to reimburse victims of authorised push payment fraud (with costs split 50:50 between sending and receiving institutions), has created powerful incentives for prevention. In its first three months, the scheme returned approximately £27 million to victims across 60 payment firms.
The Online Fraud Charter established voluntary commitments from major tech platforms around ad verification, takedown procedures, and user reporting mechanisms. The Online Safety Act provides statutory backing for these measures and creates live data-sharing frameworks between banks, tech companies, and telecommunications providers to identify and stop scams before they reach victims.
For cryptocurrency, fintech, and TradFi businesses, the implications are significant. Financial and potentially criminal liability for failing to prevent fraud creates both risk and opportunity. The risk is obvious: firms that don’t invest in robust fraud prevention may face regulatory action, reimbursement costs, and reputational damage. The opportunity is in being part of the solution.
This is where Chainalysis Alterya, AI-powered fraud prevention technology, becomes essential for private sector firms. Traditional approaches to fraud detection are reactive: identify suspicious activity after it occurs, investigate, and potentially recover funds. But by the time cryptocurrency leaves a victim’s wallet, recovery is often impossible. Alterya takes a different approach: prevention at the point of transaction. By analysing transaction patterns, counterparty risk, and network connections in real-time, it can identify likely scams before funds leave the victim’s control. This is the future of fraud prevention, where tools like Alterya can enable private sector firms to map the entire lifecycle of fraudulent operations across fiat or cryptoassets, from initial online scam campaigns and money muling to monetisation within financial services and subsequent money laundering and cash-out processes. This data could then be integrated with customers’ transaction-monitoring platforms, providing real-time analysis of scam exposure and enabling them to identify and track interactions with scam addresses, assess risk, and take preventive measures.
Setting the global standard: The UK’s data-driven blueprint
The UK’s approach to preventing fraud is a sophisticated national response to tackling industrial-scale fraud. What makes it particularly promising is its recognition that cryptocurrency isn’t just part of the problem; it’s also part of the solution. While cryptocurrency enables seamless cross-border transactions, its transparency also provides investigators with visibility that traditional financial systems can’t match. By investing in cutting-edge technology, building international partnerships, and creating regulatory frameworks that incentivise prevention, the UK is showing what’s possible when government, law enforcement, and private sector work together against a common threat.
Central to this will be a shift toward precision policing that is driven by intelligence and data. Rather than spreading resources thinly across thousands of individual cases, the UK is using blockchain analytics to identify high-impact targets — the criminal syndicates responsible for disproportionate shares of victim harm. Tools like Chainalysis Data Solutions enable this strategic approach by providing comprehensive blockchain intelligence that connects individual fraud and cyber reports to larger criminal networks, revealing patterns invisible to traditional investigation methods.
The trillion-dollar fraud problem won’t be solved overnight. But the foundation is being laid for systems that can match the scale and sophistication of the threat. And the UK is leading the way.
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