Saturday, April 20, 2024

How AI is supercharging financial fraud—and 5 ways you can protect yourself

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Financial success is measured not only by the amount of money you are able to acquire, but also by your ability to hold onto that wealth (and watch it grow). If you just got a raise or a substantial bonus, the last thing you want is to fall victim to a financial scam. Unfortunately, with the rise of artificial intelligence, those bogus text messages and calls we all receive are getting more clever, leading too many to fall into a potentially devastating trap.

In today’s edition of Forbes Edge, we’ll take a look at how fraudsters are upping their game, and how you can protect yourself (and your money) in this new AI landscape. Plus, we’ll share a few other stories worth your time—including one about a 20-year-old who has built a $15 million watch business.

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Featured story of the week: How AI is supercharging financial fraud—and 5 ways you can protect yourself

This illustration image created on June 9, 2023, shows a smartphone recording in front of a voice cloning screen in Los Angeles. CREDIT: AFP via Getty Images

In our new world of generative AI, it has become easier than ever for scammers to produce text, audio and even video that can fool not only individual victims, but the programs used to prevent fraud.

Synchrony, one of the largest credit card issuers in America with 70 million active accounts, has a front-row seat to the trend.

In His Words: “We regularly see individuals using deepfake pictures and videos for authentication and can safely assume they were created using generative AI,” Kenneth Williams, a senior vice president at Synchrony, said in an email to Forbes.

Criminals can use generative AI in a dizzying variety of ways. If you post often on social media or anywhere online, they can teach an AI model to write in your style. Then they can text your grandparents, imploring them to send money to help you get out of a bind. Even more frightening, if they have a short audio sample of a kid’s voice, they can call parents and impersonate the child, pretend she has been kidnapped and demand a ransom payment.

Businesses are being targeted, too. It’s long been common for fraudsters to email fake invoices asking for payments, but with AI tools, scammers can call company employees using a cloned version of an executive’s voice and pretend to authorize transactions or ask employees for sensitive data in “vishing” or “voice phishing” attacks.

So yes, the threat of falling for financial fraud appears to be greater than ever. With the ability to clone voices, images and writing styles, it’s not just the elderly who are being targeted these days. It’s important to take preventative steps now to ensure that you or your business don’t fall for a potentially crippling scam.

In 2022, consumers reported losing $8.8 billion to fraud, up more than 40% from 2021, the U.S. Federal Trade Commission reports. The biggest dollar losses came from investment scams, but imposter scams were the most common, an ominous sign since those are likely to be enhanced by AI.

Here are five tips to protect yourself against AI-enabled scams:

  1. Fortify your accounts: Multi-factor authentication requires you to enter a password and an additional code to verify your identity. Enable this on all your financial accounts.
  2. Be private: Consider tightening your privacy or sharing settings on social media accounts. Scammers can use personal information that you share on these sites against you.
  3. Screen your calls: Don’t answer calls from unfamiliar phone numbers.
  4. Create passphrases: Talk with your friends and family members and agree upon certain phrases that you will use if talking about financial matters or other serious topics.
  5. Throw them off: If you suspect someone could be impersonating a loved one or business associate on the phone, try asking a personal question and see how the caller reacts.

Read the full story here for more examples on how artificial intelligence is making financial scams harder to spot.

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Samuel Musila
Samuel Musila
Passionate Software Developer and Tech content creator From Nairobi, Kenya

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