Dive Brief:
- AI-driven fraud skyrocketed last year, fraud detection company Pindrop found in a recent study, with overall attacks against its major U.S. customers rising 1,210% and combined losses reaching an estimated $1 billion.
- Generative AI and deepfake tools are enabling fraudsters to scale their attacks and carry them out more effectively, according to a report on the findings released this month. Pindrop analyzed internal fraud data pertaining to over 50 of its major U.S. customers, a spokesperson said.
- Last year “was the watershed moment when fraud stopped being manual and became an automated supply chain,” Pindrop CEO Vijay Balasubramaniyan said in an email response to questions. “AI scams are faster, cheaper, and harder to spot, and they’re hitting where decisions get made in real time: contact centers, urgent payment requests, and executive impersonation. Attackers can now run thousands of attempts across voice, video, chat, and email using synthetic identities that look and sound legitimate.”
Dive Insight:
AI fraud has now outpaced traditional fraud, signaling a major shift in the threat landscape, according to Atlanta-based Pindrop, which provides tools for detecting when fraudsters use deepfake technology to pose as job candidates, among other scams.
“AI-generated videos and voices impersonate job candidates to gain system access or high-level executives to execute social engineering scams,” the report said. “The tactics differ, but the foundation is the same: convincing, sophisticated AI-backed schemes.”
The research comes on the heels of similar findings from Paris-headquartered Trustpair, a software vendor focused on payment fraud prevention.
Nearly three-quarters (71%) of U.S. companies have experienced an increase in AI-powered fraud attempts in the past year, and roughly half of finance leaders (47%) say AI-generated fraud is now one of their biggest challenges in fraud prevention, the Trustpair study found. One in four companies surveyed by Trustpair reported six-figure losses due to fraud.
“AI has raised the baseline of fraud,” Trustpair CEO Baptiste Collot said in a statement. “The risk keeps increasing, but internal processes haven’t moved fast enough.”
The retail sector was among industries that were hit the hardest by AI fraud last year, Pindrop said, adding that fraudsters are particularly focused on automating refund scams at scale.
“Attackers deploy bots equipped with common scripts that initiate return requests on retail sites,” the firm said in its report. “The strategy is intentional: target low-dollar refunds that stay below a certain threshold to avoid suspicion.”
