Mitigate AI-driven fraud attacks with biometric IDV, MFA: reports

AI-driven identity fraud in Europe is on the rise, according to a recent report by Signicat, in collaboration with independent consultancy Consult Hyperion. The study reveals that many fraud prevention decision-makers across Europe are witnessing AI-driven identity fraud and anticipate further growth, yet feel unprepared to tackle it effectively.

Key findings of the report titled “The Battle against AI-driven Identity Fraud”, include an increase in deepfakes, 42.5 percent of detected fraud attempts involved AI, with 29 percent of these attempts being successful, and account takeovers, commonly associated with consumer fraud, are the most prevalent fraud type for B2B organizations.

Asger Hattel, CEO of Signicat, emphasizes the need for expertise and resources to combat AI-driven fraud effectively. David Birch, Director at Consult Hyperion, stresses the importance of robust identity systems to resist evolving fraud tactics and protect legitimate customers.

The report indicates that while AI is not yet making fraud materially more successful, its potential for enabling sophisticated and large-scale fraud poses significant risks. The shift from creating new accounts with forged credentials to compromising existing accounts is notable. Account takeover attacks are now the most common type of fraud, often exploiting weak or reused passwords.

Deepfakes are frequently used to impersonate account holders rather than creating synthetic identities, accounting for one in 15 fraud attempts.

In addition to this, a survey by FIDO Alliance finds that 52 percent of its respondents are concerned about deepfakes when verifying identities.

This follows a recent whitepaper by Consult Hyperion reveals traditional approaches have typically depended on capturing and scrutinizing static images or videos of tangible documents. However, these methods are encountering a significant challenge posed by the emergence of deepfake injection attacks.

Despite a high awareness of AI-driven identity fraud, organizations remain unprepared for the threat, Signicat notes.

However, a recent report from Liminal, a company in market and competitive intelligence for fraud prevention technology, identifies a shift towards more advanced account takeover fraud prevention solutions. The tools include app-based and biometric authentication, continuous authentication, and data breach monitoring.

An example is Oscilar, a supplier of AI-powered risk management solutions, and Socure, a provider of artificial intelligence for digital identity verification, sanction screening, and fraud prevention, partnering to establish a benchmark in digital identity verification, fraud prevention, and risk management within the financial sector. This joint effort integrates Oscilar’s risk management platform with Socure’s identity verification solutions.

Elsewhere, Treasury Prime, an embedded banking software company, recently announced its partnership with Footprint, a unified onboarding platform for identity, fraud and security, to provide banks and their fintech clients access to Footprint’s Know Your Customer (KYC) and Know Your Business (KYB) technology.

Article Topics

biometric authentication  |  Consult Hyperion  |  David Birch  |  digital identity  |  Footprint  |  fraud prevention  |  identity verification  |  Liminal  |  Signicat  |  Socure  |  synthetic identity fraud