Protecting Your Business from AI-Enhanced Fraud

In today’s digital landscape, fraud is a growing risk for businesses of all sizes. Fraudsters are evolving quickly, using advanced tools like Artificial Intelligence (AI) to target businesses with more sophisticated scams than ever before. 

It’s important for business owners and their teams to understand how AI is being used against them—and how to stay protected. 

The most common AI-driven schemes targeting businesses today: 

1. Deepfake CEO Scams 
   AI is now able to generate lifelike voices. This technology can be trained on real audio recordings of specific people to sound almost indistinguishable from the real thing. This is taking the CEO scam to a new level. Instead of receiving an email, now employees might receive a phone call or voicemail that sounds exactly like an executive, urging them to share sensitive information or send money immediately. 
    
2. AI-Powered Phishing Emails 
   AI is giving scammers the upper hand when it comes to phishing emails. They are increasingly using generative AI to create convincing campaigns. Gone are the days of obvious spelling and grammatical errors. This technology enables them to mimic the tone, writing style and formatting of real people, and it can be hard to distinguish them from legitimate emails. 
    
3. Synthetic Identity Fraud 
   Traditional identity fraud assumes the identities of real businesses and people. Synthetic identity fraud combines real data with fake information to create new, entirely fake businesses and people. Generative AI helps scammers automate this process and become even faster. They use these synthetic identities to target businesses by opening fraudulent accounts, making purchases they never intend on paying, and collecting payments for products/services that don’t exist. 

Practical Steps to Protect Your Business 

1. Implement Payment Process Best Practices
   • Limit who can access and authorize financial transactions and online banking.
   • Require dual control for all ACH, wire transfers, and large payments.
   • Always validate large and unusual financial requests with a call back verification using a known phone number or by contacting them in person.
     • This step is imperative when there are changes in payment information.
   • Take the time to verify. Scammers will try to rush you.
2. Investigate Your Vendors
   • Always research your vendor before signing on to work with them.
     • Verify their contact information, check their business registrations and licenses, and look up their online presence and reviews.
   • Use caution if a vendor appears suddenly or has limited history.
   • Keep an eye on your account activity to identify transactions from unfamiliar or low-quality vendors.
3. Secure Your Systems
   • Keep your antivirus, firewalls, and security software up to date.
   • Enable multifactor authentication (MFA) on your email, banking, and accounting platforms.
4. Keep Learning
   • Sign up for fraud alerts and newsletters from Bank of Colorado.
   • Conduct regular fraud awareness training for your employees.
     • Teach them to recognize the red flags of fraud and use cybersecurity best practices.
5. Talk with Your Banker
   • Periodically contact the bank to confirm your contact information on file.
   • Ask about creating a security phrase or verbal password for your accounts.
     • This adds an extra layer of security as the phrase must be said before any account details are discussed.
6. Never Hesitate to Report
   • The longer you wait to report suspicious activity, the more losses can accumulate. If you see something out of the ordinary, immediately notify all your financial institutions, as all can be impacted at different times.
   • Alert the proper authorities. 

AI as a Tool For Good 

There’s no doubt AI is a powerful tool for fraudsters. However, this technology can also be used to help fight fraud. 

AI is very fast and can analyze large amounts of data quickly. Whether it’s an unusual transaction, an altered invoice or suspicious login, AI can assist in detecting those anomalies in real-time and immediately report them. 

At Bank of Colorado, our fraud team uses AI machine learning tools. The speed and scale of this technology combined with the expertise of our investigators, helps us manage the ever-growing threat of fraud more effectively. 

AI is a powerful tool—for both defense and deception. The best protection against AI-enhanced fraud is a combination of smart technology, strong internal controls, and alert employees. 

If you ever have questions or suspect fraud, don’t hesitate to contact your local branch. We’re here to help protect your business, your reputation, and your peace of mind.