Attempts to defraud service members, veterans and their families are so rampant that advocates are pushing for an entirely new approach to cracking down on predators and root causes, according to a recent congressional roundtable.
In an increasingly digital world in which it is easy to mask identity, lawmakers should ensure federal agencies “don’t have a monopoly on enforcement,” Rohit Chopra, director of the Consumer Financial Protection Bureau from 2021 to 2025, said during the Jan. 21 House Veterans’ Affairs Committee Democrats discussion.
“We should be rethinking our enforcement strategy and policy approach,” added Chopra.
That might mean amending laws to give state attorneys general more enforcement authority in protecting troops and veterans, he said, and in many cases give private citizens the ability to pursue legal action.
The staff at CFPB has been “obliterated” over the last year with the change in administrations, said Rep. Mark Takano (D-Calif.), the ranking member of the House Veterans’ Affairs Committee.
“We went through this whole thing with [the Department of Government Efficiency] to root out waste, fraud and abuse,” Takano said. “But there’s tremendous fraud being perpetrated, and we’re not equipping our government to protect American citizens.”
A federal judge in December blocked the Trump administration’s attempt to defund the CFPB. Since its opening in 2011, it has returned $21 billion to consumers, according to Chopra.
In 2024, meanwhile, the Federal Trade Commission received about 210,000 consumer fraud complaints from troops and their families, with losses totaling nearly $600 million.
Chopra said the CFPB and the FTC haven’t brought a single enforcement action over the past year related to violations of the Military Lending Act, or abuses in the Veterans Affairs mortgage program or G.I. Bill.
Among other things, the Military Lending Act puts a 36% cap on many consumer loan interest rates for active duty troops and their families.
“CFPB and the FTC have to be fully funded and staffed and doing their job,” said Jeremy Villanueva, associate legislative director of Paralyzed Veterans of America. “By the time a law comes out, people have already been victimized. CFPB is supposed to be out there ahead of that.”
Professional scammers are reactionary, Villanueva added, and will quickly find a way around new laws and regulations.
Officials at the CFPB and FTC did not respond to a request for comment as of publication.
The VA Office of Inspector General investigates fraud schemes that damage VA programs and diminish services provided to veterans, caregivers and survivors, David Case, VA deputy inspector general, said during the roundtable.
In fiscal 2025, their investigators pursued 150 criminal fraud cases, he added.
While job scams target anyone, military spouses may be especially vulnerable because of frequent moves, said Ally Armeson, executive director of Cybercrime Support Network.
“You become desperate, you’re looking for any job. … You fall into a job scam.”
Suddenly, there’s no job, and the spouse has paid money or lost information to a scammer, added Amerson, a veteran and military spouse.
“It’s incredibly challenging … to build a career as a military spouse and to find a profession that’s compatible with the military lifestyle,” said Eileen Huck, director of government relations for the National Military Family Association.
Huck added that some spouses are reeled in to multi-level marketing jobs, which may operate as illegal pyramid schemes. She also cited some used car dealers as entities that prey on young troops.
“They’re paying thousands on a credit card they’re not prepared for,” she said. “They don’t always have the financial expertise or knowledge before taking on obligations.”
Identity theft, romance scams, education scams, crypto scams and disability claims scams are among the many schemes that target the military community, advocates told lawmakers.
Armeson said her organization has a recovery group that attempts to help victims who have lost money, but restitution — if any — can take years, and victims only get back a fraction of what they lost.
The median amount victims have lost in crypto scams is $230,000, she said, citing organizational data. For romance scams, that number is $130,000.
In the veteran community, meanwhile, select schools often make false promises to secure troops’ guaranteed GI Bill money, said Will Hubbard, vice president for veterans and military policy at Veterans Education Success.
Seven of the top 10 schools with the highest GI Bill money accrual have experienced high volumes of student complaints, he said, and even faced state law enforcement actions.
“This is a systemic issue. We need to hit the root cause,” Hubbard said.
Tech companies should also be regulated, held accountable and forced to warn people about scams, said Gretchen Peters, founder and executive director of Alliance to Counter Crime Online.
Some social media platforms are able to detect individual scammers within about two weeks of setting up a new account, she added.
Chopra said it has become easy to extract personal information about troops with social media and other platforms. Data brokers also sell information about the military community to scammers, he added.
This enables them to figure out “who is really looking for romance, who is looking for a car, who is actually in financial distress,” he said.
Karen has covered military families, quality of life and consumer issues for Military Times for more than 30 years, and is co-author of a chapter on media coverage of military families in the book “A Battle Plan for Supporting Military Families.” She previously worked for newspapers in Guam, Norfolk, Jacksonville, Fla., and Athens, Ga.
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