AI-driven deep fakes set to fuel explosion in e-commerce fraud

My Nguyen

8th Oct 2024

Retailers selling online face mounting costs from e-commerce fraud thanks to growth in AI-generated deep fakes, according to a report from Juniper Research.

The study predicts that global losses due to e-commerce fraud will surge from US$44 billion this year to $107 billion in 2029 – a massive 141 per cent.

Juniper says AI-generated deepfakes pose a significant threat to facial recognition systems, enabling attacks across the digital landscape. Furthermore, the rising incidence of “friendly fraud” – in which customers engage in deceptive practices like refund fraud – contributes to substantial business losses.

Artificial intelligence fosters fraudulent transactions

By generating more dedicated technologies, including credible messages and synthetic identities, AI enables cyber fraudsters to leapfrog from security measures and overwhelm rule-based prevention systems with unprecedented frequency. 

“E-commerce merchants must seek to integrate fraud prevention systems that offer AI capabilities to identify emerging tactics quickly. This will prove especially important in developed markets, where larger merchants are at higher risk of being targeted for fraud, such as testing stolen credit cards,” the report’s author, Thomas Wilson, says.

Merchants fight for their business 

Incorporating actual-based motion analysis such as biometric identification and liveness detection, merchants can recognise emerging fraud patterns and react in real time to prevent AI deep fake fraud attempts.