Financial institutions are facing a significant increase in deepfake fraud attempts, which have grown by a staggering 2,137 percent in the last three years.
Data from Signicat based on responses from 1,200 people in the financial and payment sectors across seven European countries, including the UK, shows that account takeover is the leading type of fraud their customers are exposed to, followed by card payment fraud and phishing.
It finds that 42.5 percent of fraud attempts detected in the financial sector are now due to AI. Deepfake fraud divides into two categories of attack.
Presentation attacks include fraudsters wearing masks and makeup to spoof another person, but also where the camera films another screen showing a deepfake in real-time, targeting activities such as account takeovers or fraudulent loan applications.
Injection attacks involve, malware or untrusted input is deliberately inserted into a program, compromising its integrity or functionality for example as pre-recorded videos, often during onboarding or KYC processes that banks, fintech companies, or telecommunications companies are subjected to.
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But despite the increase in AI-driven fraud attempts, including deepfakes, only 22 percent of financial institutions have implemented AI-based fraud prevention tools. This gap potentially leaves many companies vulnerable to more sophisticated attacks.
“Three years ago, deepfake attacks were only 0.1 percent of all fraud attempts we detected, but today, they represent around 6.5 percent, or one in 15 cases. This represents an increase of 2,137 percent in the last three years, which is alarming. Fraudsters are using AI-based techniques that traditional systems can no longer fully detect. Organizations should consider advanced detection systems that combine AI, biometrics and identity verification to protect against these threats,” says Pinar Alpay, chief product and marketing officer at Signicat. “A multiple detection setup is crucial. By combining early risk assessment, robust identity verification and authentication methods based on facial biometrics, and ongoing monitoring, companies can better protect both their operations and their customers. Orchestration of these tools in the optimal combination is the essence of a multi-layered protection.”
You can get the full Battle Against AI-Driven Identity Fraud report from the Signicat site.
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