Amateurs Using AI in Banking Scams: BioCatch Survey Findings

Amateurs are increasingly using AI in banking scams, according to a recent survey by BioCatch. The survey found that nearly 70% of fraud-management officials believe that criminals are more skilled at using AI to commit financial crimes than banks are at using the technology to prevent them.

The report highlights a concerning trend where criminals with minimal technical expertise are leveraging AI to enhance the quality and success of their digital banking scams and financial crime schemes. This has led to a rise in synthetic identity fraud, with more than 70% of companies identifying the use of synthetic identities while onboarding new clients last year.

The Federal Reserve has also raised concerns about synthetic identity fraud, estimating that traditional fraud models fail to detect up to 95% of synthetic identities used to apply for new accounts. This type of fraud is considered the fastest-growing financial crime in the US, costing companies billions of dollars annually.

To combat this growing threat, financial institutions are being urged to adopt new strategies and technologies to protect their customers. BioCatch’s Director of Global Fraud Intelligence, Tom Peacock, emphasized the need for banks to stay ahead of fraudsters who are leveraging AI to supercharge their scams.

The survey also revealed that financial institutions are increasingly using AI to detect fraud and financial crime, with 87% of respondents stating that AI has improved the speed at which their organizations respond to potential threats. However, there is a call for greater collaboration between different departments within companies, as well as between financial institutions and government authorities, to combat fraud effectively.

Overall, the survey underscores the need for a collective effort among technology providers, banks, regulators, and law enforcement to combat the growing threat of financial crime. As BioCatch CEO Gadi Mazor stated, fraud fighters must collaborate and share information instantly to reverse the rising trend of fraud globally.

The full report of BioCatch’s 2024 AI, Fraud, and Financial Crime Survey can be accessed via their website.