The Biggest Mistakes to Avoid in the Fight Against AI Fraud
AI fraud is no longer a distant threat—it’s already here, and it’s growing rapidly. Fraudsters are using AI to create deepfake identities, bypass security systems, and carry out scams at an unprecedented scale. Many businesses are still vulnerable, not just because they lack defences, but also because of common missteps in their approach to fraud prevention. To protect your organisation effectively, avoid these critical mistakes.
Thinking AI Fraud Is a Problem for the Future
Many businesses assume AI-driven fraud is something to worry about down the road. That can be a costly misconception. Nearly half of all fraud attempts already involve AI, with deepfake-related fraud increasing by over 2,100% in the last three years. According to Chainalysis, cryptocurrency fraud reached an estimated $9.9 billion in 2024, with projections suggesting a rise to $12.4 billion. Delaying action only gives fraudsters more time to refine their methods while your defences grow outdated.
What to do instead: Treat AI fraud as an immediate risk. It’s happening now, and if your security measures aren’t evolving at the same pace as these threats, your business is already exposed.
Relying on Outdated Security Measures
Passwords, manual verifications, and basic identity checks were once enough. Today, they’re no match for AI-driven fraud. Scammers can now generate realistic fake documents, manipulate video feeds, and even mimic voices with terrifying accuracy. Traditional security tools just weren’t built to detect these sophisticated attacks. The Battle Against AI-Driven Identity Fraud research revealed ongoing confusion about the best defence strategies against AI-driven identity fraud. Crucially, the right measures are not being prioritised.
What to do instead: AI-driven fraud requires AI-driven defences. Fraud prevention strategies must evolve to include behavioural biometrics, liveness detection, and AI-powered deepfake analysis. Solutions that can detect presentation and injection attacks are no longer optional—they're essential to staying ahead of fraudsters.
Underestimating the Power of Deepfakes
Many assume that deepfakes—AI-generated images, videos, or voices—aren’t realistic enough to fool security systems. Despite growing concerns, 75% of fraud decision-makers still believe deepfakes will never be convincing enough to deceive financial organisations. But in reality, fraudsters are already using this technology to create fake identities, forge documents, and even impersonate executives in financial scams. These aren’t just small breaches; they can lead to major financial losses and damage your company’s reputation.
Based on responses from 1,200 European fraud decision-makers. Source: Battle Against AI-Driven Identity Fraud research, 2024.
What to do instead: Invest in solutions that can detect the subtle signs of deepfakes. AI tools that analyse facial movements, check for digital tampering, and flag suspicious patterns before fraudsters succeed are critical in protecting your business.
Using a One-Size-Fits-All Approach
Fraudsters don’t rely on just one trick to commit fraud—so why would a single security measure be enough to stop them? AI-driven scams often combine multiple tactics, such as synthetic identities, phishing, and deepfakes, to bypass weak defences. If your fraud prevention strategy only focuses on one or two layers of security, you’re leaving gaps that fraudsters can easily exploit.
What to do instead: Build a multi-layered fraud prevention strategy. Combining biometric verification, risk assessments, and continuous monitoring will make it significantly harder for fraudsters to succeed at any stage of the attack.
Neglecting the Human Factor
While technology is crucial in protecting your organisation, employees are often the easiest targets for fraudsters. Social engineering attacks, phishing emails, and deepfake scams often rely on human error rather than technical vulnerabilities.
What to do instead: Educate your team —from C-level executives to front-line staff— about the dangers of AI fraud. Provide training on how to spot fraudulent attempts, and encourage employees to verify suspicious requests.
Delaying Investment in AI-Driven Security
According to the report, more than 75% of businesses acknowledge the importance of AI-driven fraud prevention, but fewer than 25% have implemented effective systems. Many companies delay upgrading their fraud protection due to budget constraints or internal approval processes. However, AI fraud is progressing at a faster pace than most companies can respond to. Postponing upgrades increases the risk of dealing with the consequences of fraud once it’s already caused damage.
Based on responses from 1,200 European fraud decision-makers. Source: Battle Against AI-Driven Identity Fraud research, 2024.
What to do instead: Waiting for the "right time" to upgrade security is itself a risk. With AI-driven fraud evolving quickly, taking action sooner is crucial to staying ahead and avoiding the fallout of a successful attack.
AI-driven identity fraud is more than just a technical challenge—it’s a growing business risk that demands immediate action. The companies that will struggle the most aren’t necessarily those without any defences, but those that are relying on outdated or ineffective ones. By avoiding these common mistakes and staying proactive in your security measures, you can ensure your business stays one step ahead of fraudsters.