Artificial Intelligence (AI), like all other technology, is just not inherently good or bad – it’s merely a tool people can use for decent or unwell purposes.
For instance, many firms use AI-powered biometrics solutions in speech and facial recognition to streamline login processes and enhance the client experience by replacing tedious PINs, passwords and account numbers. Businesses may leverage AI to uncover beneficial insights from amongst mountains of knowledge to craft personalized customer experiences.
Beyond the client experience, AI can analyze imaging data in medical settings to extend the accuracy of tumor identification and classification. Likewise, AI is augmenting language learning tools and programs, allowing more people access to life-enriching skills.
In fact, AI is offered to not only well-meaning individuals but additionally malicious ones who commonly employ its capabilities to supercharge their fraudulent schemes.
How Bad Actors Use AI to Enhance Their Scams
Highly sophisticated and well-resourced criminal organizations have already begun to make use of AI for brand spanking new and ingenious (or fairly, insidious) attack vectors. These fraudsters will train their AI engines with terabytes and even petabytes of data to automate their various schemes, constructing exploits and scams at a scale unimaginably larger than the capabilities of a single human hacker.
Some hackers will even exploit AI-powered systems that drive higher customer experiences through AI-generated deep fakes that focus on biometric authentication systems. Specifically, savvy fraudsters use AI to create deepfake voice clones for robocall scams. Typically, scam calls or SMS texts pose as someone or something to trick the victim into divulging sensitive account information or clicking a malicious link.
Up to now, people could often tell when a call or text was suspicious, but this latest breed of deepfake robocalls uses AI-generated clones of individuals’s voices. The applications of those voice clones are truly disturbing. Fraudsters will copy a toddler’s voice, pose as kidnappers and call the parent, demanding they pay a ransom for the discharge of their child.
One other common approach to scammers when using AI voice clones is looking an worker and impersonating that person’s boss or someone of seniority, insisting they withdraw and transfer their money to pay for some business-related expense.
These schemes are prolific and effective, with a 2023 survey from Regula discovering that 37% of organizations experienced deepfake voice fraud. Likewise, research from McAfee shows that 77% of victims of AI-enabled scam calls claimed to have lost money.
Organizations Must Confirm Their Customer’s Identity Â
The continuing evolution of AI is akin to an arms race, with businesses continuously deploying the latest innovations and techniques to thwart fraudsters’ latest schemes.
For instance, Know Your Customer (KYC) processes allow firms to confirm a customer’s identity to find out whether or not they are a possible customer or a scammer attempting to perform fraudulent transactions or money laundering. KYC is mandatory for a lot of industries. For instance, within the US, the Financial Crimes Enforcement Network (FinCEN) requires financial institutions to comply with KYC standards.
The introduction of AI has made the KYC battlefield more dynamic, with each side (good and bad) utilizing the technology to attain their goals. Modern businesses have taken a multi-modal approach to KYC processes, where AI helps detect suspicious activity after which warns affected customers via text messages.
To prove their identity, customers must provide a type of identification, similar to a date of birth, photo ID, license or address. After customers display they’re who they are saying they’re, this multi-modal KYC process then associates a phone number to a customer, which is able to function a digital ID.
The convenience and ease of cell phone numbers make them ideal digital identifiers within the KYC process. Likewise, mobile phones provide businesses with reliable and verifiable data, including the worldwide ubiquity that national registries cannot replicate.
Authoritative Phone Numbering Intelligence
Unfortunately, businesses aren’t the one ones who recognize the worth of mobile numbers as digital identifiers. As mentioned, bad actors often goal customers through fraudulent texts and phone calls. Research from Statista shows nearly half of all fraud reported to the US Federal Trade Commission starts with texts (22%) or a phone call (20%).
Within the case of a ported phone number (i.e., it modified from one phone company to a different), businesses don’t have any way of knowing if this motion was simply a customer switching providers or a fraudster bent on malicious intent. Moreover, fraudsters can use SIM swaps and port outs to hijack phone numbers and use those digital identifiers to masquerade as customers. With these numbers, they will receive the text messages firms use for multi-factor authentication (MFA) to interact in online payment fraud, which topped $38 billion globally in 2023.
Though SIM Swaps present a possibility for number hijacking, organizations can effectively combat this scheme by utilizing authoritative data. In other words, while phone numbers are still ideal digital identifiers, organizations need a trusted, authoritative, and independent resource for details about each telephone number to validate ownership. By leveraging authoritative phone numbering intelligence, businesses can determine if a customer is really legitimate, protecting revenue and brand repute while boosting customer confidence in voice and text communications.
Enterprises also need deterministic and authoritative data. More specifically, their AI solutions need access to data about each phone number, whether it was ported recently or is related to a selected SIM, line type or location. If AI assesses that the info indicates deceitful activity, it should require the person to supply additional information, like mailing address, account number or mother’s maiden name as an additional step within the verification process. Businesses must also leverage an authoritative resource that continually updates phone number information, enabling AI tools to acknowledge fraudulent tactics more effectively.
Digital Identity and the Age of AI
The world is more connected than ever, with mobile devices powering this unprecedented interconnectivity. While this connectedness advantages organizations and consumers, it poses significant risks and responsibilities. Furthermore, proving one’s digital identity is just not as straightforward with out a trusted and authoritative source.
Within the age of AI, schemes like sophisticated AI-generated deepfakes, voice clones and highly tailored phishing emails further emphasize the necessity for enterprises to utilize authoritative phone numbering intelligence to empower their AI to guard against fraud. Such efforts will restore customers’ faith in business text messages and phone calls while safeguarding revenue and brand repute.
