- AI is enabling fraudsters to create convincing scams, including fake profiles, videos, and websites.
- CFTC advises strengthening privacy settings and avoiding sharing sensitive info with unknown contacts.
- OCEO works with regulators and groups to promote financial literacy and protect against fraud.
The Commodity Futures Trading Commission’s (CFTC) Office of Customer Education and Outreach (OCEO) has issued a new advisory, highlighting the rising threat of fraud enabled by generative AI.
According to a recent advisory, criminals use AI technology to create convincing scams, including fake social media profiles, videos, and websites designed to deceive individuals into thinking they are interacting with legitimate financial platforms.
The advisory, titled Criminals Increasing Use of Generative AI to Commit Fraud, details how perpetrators use AI to fabricate realistic images, voices, and videos. It also highlights how criminals are utilizing AI for live-streamed video chats. Notably, these fraudulent materials are designed to resemble trusted financial institutions and government bodies. In some cases, criminals also use AI to forge government or financial documents to trick unsuspecting victims further.
OCEO Director Melanie Devoe pointed out that:
“Fraudsters can use new technologies to mask their identities, not only in still photographs, say, in social media profiles, but also in video chats that alter their facial features and voices to match.”
Steps to Safeguard Against AI-Facilitated Fraud in Crypto
In the advisory, the CFTC outlined several steps consumers can take to protect themselves. Among the key recommendations is strengthening privacy settings on social media accounts. Additionally, individuals are advised to be cautious about sharing personal or sensitive information with people they only know online. They are also warned about unrecognized callers.
Director Devoe noted:
“Identifying real from fake can be difficult. The best defense is to never give money to people you only meet online.”
Also, the CFTC warned against engaging with websites, profiles, or videos that appear suspicious or too convincing to be true. In addition to the CFTC’s advisory, the FBI issued a public service announcement addressing how fraudsters are leveraging AI to create fake identities and documents.
Combating AI Fraud in Crypto and Financial Sectors
Notably, the rise of AI-assisted fraud has raised concerns among consumer protection groups and financial regulators. Ongoing efforts focus on educating the public about these emerging threats and providing tools to avoid falling victim to scams.
For context, the CFTC’s OCEO is dedicated to helping consumers protect themselves from financial fraud. It also works to address violations of the Commodity Exchange Act. The office develops educational resources and conducts outreach programs. It also partners with regulators and consumer protection groups to promote financial literacy and safety.
