According to the latest data from Sift’s Q2 2023 Digital Trust & Safety Index, more than two-thirds of US consumers reported an upsurge in spam and scams. The rise in spam has been attributed to the introduction of consumer-oriented generative AI tools in late 2022.
Another finding of the report is that around half of consumers have difficulties in identifying scams. Moreover, the report showcases that roughly 20% of consumers said that they have been successfully phished.
The wave of AI-empowered scams is leading to downstream abuse that has consequences for both consumers and businesses. More precisely, according to Sift, there has been an uptick in account takeover attacks (ATO), as the ATO rate soared by 427% during the first quarter of 2023 in contrast to the entire span of 2022.
In its analysis of the larger context, Sift concluded that the current marketability as well as the availability of fraud tools, including the AI-based ones, has led to the democratisation of fraud. According to experts, given the new tools available, anybody can now use stolen credentials or payment information to commit fraud, irrespective of their prior knowledge on the subject.
More to this point, Sift’s researchers have tracked the growth of automated social engineering scripts known as one-time password (OTP) bots, which have been openly shared on groups in the Telegram app.
OPT bots reportedly use ID spoofing techniques to trick victims into divulging their OTPs. After they receive the OTPs, the fraudsters exploit them to gain access to the victim’s bank account or payment service apps. While not all consumers might get tricked, given the scalability of the bots, fraudsters can still profit from this technique.
According to the official press release, even though generative AI has been recently launched, its use for fraudulent activity and the impact this can have on both consumers and businesses is unquestionable.
To safeguard themselves against these new threats and thus, protect their revenue and customers, businesses can embrace AI and automation. An advantage of doing so is, reportedly, a reduction in friction for legitimate users.
Sift is a fraud detection provider that specialises in fostering digital trust and safety. The company leverages its capabilities to assist digital disruptors to Fortune 500 enterprises to drive revenue growth without compromising security.
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