The top-5 identity fraud types in 2023 are: AI-powered fraud, money muling networks, fake IDs, account takeovers and forced verification. This, according to an update from Sumsub.
Sumsub recently released its third annual Identity Fraud Report of the year. The report provides a comprehensive analysis of identity fraud “across industries and regions based on millions of verification checks across 28 industries and over 2,000,000 fraud cases between 2022-2023.”
Identity Fraud Main Trends and Statistics for 2023
Sumsub’s research key findings include:
- The top-5 identity fraud types in 2023 are: AI-powered fraud, money muling networks, fake IDs, account takeovers and forced verification.
- There’s been a significant 10x increase in the number of deepfakes detected globally across all industries from 2022 to 2023, with notable regional differences: 1740% deepfake surge in North America, 1530% in APAC, 780% in Europe (inc. the UK), 450% in MEA and 410% in Latin America.
- The country attacked by deepfakes the most is Spain, the most forged document worldwide is UAE passport, whereas Latin America is the region where fraud increased in every country.
- ID cards remain the most frequently exploited for identity fraud, accounting for nearly 75% of all fraudulent activities involving identity documents.
- Online media is the industry with the highest identity fraud increase.
Artificial Intelligence and Deepfakes: Ambivalent Potential
With AI-driven fraud remaining “the most prominent challenge across various industries, crypto is the main target sector (representing 88% of all deepfake cases detected in 2023), followed by fintech (8%).”
Pavel Goldman-Kalaydin, Head of AI/ML at Sumsub, said:
“The rise of artificial intelligence is reshaping how fraud is perpetrated and prevented. AI serves as a powerful tool both for anti-fraud solution providers and those committing identity fraud. Our internal statistics show an alarming tenfold increase in the number of AI-generated deepfakes across industries from 2022 to 2023. Deepfakes pave the way for identity theft, scams, and misinformation campaigns on an unprecedented scale.”
AI will be a key focus of regulations in 2024, and companies “should take note with the understanding that AI safety is set to become an integral part of their activities. In addition to the AI-powered fraud prevention tips, the report provides an exclusive overview of AI regulations.”
For instance, China is known to “have pioneered deepfake regulation, with the “Regulations on the Administration of Deep Synthesis of Internet Information Services” approved by the Chinese Cyberspace Administration Authority (CAC) in December 2022 and having come into force in August 2023.”
In the report, readers will find “a summary of the primary efforts to regulate deepfakes in other key jurisdictions – EU, UK and US.”
In 2023, identity fraud patterns “continued to shift towards more complex and sophisticated techniques, fueling more advanced scams and money laundering techniques. Among the most common complex fraud schemes is money muling, where seemingly innocent individuals, known as money mules, are recruited to transfer illegally obtained funds, disguising their origin.”
Overall, in the past three years the fraud landscape “has evolved with the development of new technologies, signaling a growing concern for businesses and individuals alike.”
Based on Sumsub findings, the global rate of identity fraud “nearly doubled from 2021 to 2023.”
For more details, check here.