Throw enough bait and something will eventually bite. This appears to be the attitude scammers are taking when it comes to committing fraud in 2023 as they capitalise on artificial intelligence (AI) tech. Sift, the digital trust and safety organisation has released its Q2 2023 Digital Trust & Safety Index, which has found 78 per cent of users are concerned about AI defrauding them.
The growth of AI has been a double-edged blade. While it has the opportunity to help consumers, it can also massively harm them when abused by the wrong parties. In fact, 68 per cent of US consumers have reported an increase in spam and scams since November 2022. This is in large part due to generative AI tools having entered the consumer sphere and become popular among fraudsters. Worryingly, due to the growth of AI, nearly half (49 per cent) of consumers admit it’s become more difficult to identify scams during the same period.
Nineteen per cent of consumers have admitted to falling to phishing scams too. Business email compromise scams have cost organisations $43billion over the last few years according to the report. With the growth of AI-generated scams, businesses must be wary. Especially as these scams can lead to account takeover (ATO) attacks too.
In the first quarter of 2023, the rate of ATO attacks rose 427 per cent compared to all of 2022. One-time password (OTP) bots have been introduced by scammers to help with account takeover scams too. These bots trick employees into providing OTPs for any login detail they’re after. While many are able to identify these, the sheer amount of people contacted makes the bots worthwhile for scammers. Especially as they can pay for them on a daily, weekly, monthly, or yearly basis.
The issue is not one that will just go away with time, however. According to Sift, global e-commerce fraud loss is estimated to reach $48billion by the end of 2023, a 16 per cent YoY increase. Even more concerning is that if nothing is done, businesses may lose up to $343billion by 2027 in payments fraud.
Who is at fault?
Scammers are evolving too. As organisations look to find new ways to stop them, they’re after new ways to abuse employees. So much so, that nearly half (49 per cent) of employees have admitted spotting scams has become harder in the last six months. Over a fifth (21 per cent) of employees are worried they would not be able to spot an AI-generated scam.
The unfortunate reality is that people will fall victim to scams. However, 54 per cent of consumers do not believe they should be held responsible should they be scammed. Of this number, 30 per cent believe their bank or financial institution should be responsible for preventing the fraudulent transaction. Meanwhile, 24 per cent believe it should be on the business where the attempted purchase was made.
“Though still in its infancy, generative AI has already been a boon for fraudsters,” said Brittany Allen, trust and safety architect at Sift. “Combined with the scale and availability of automated tools, online scams will soon be ubiquitous and frighteningly convincing, leading to incalculable losses for consumers and companies alike. Businesses, however, can both protect their customers and grow revenue by embracing AI and automation themselves to prevent fraud before it happens and reduce friction for legitimate users.”
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