Deepfake Fraud Alert: How FinCEN’s Guidance Affects Banks

Even though deepfake-related fraud suspicious activity reports are on the rise, many financial institutions do not have a deepfake detection solution. FinCEN’s recent alert notes that banks have seen an increased use of deepfakes, specifically relating to bypassing identity verification and authentication processes using generative-AI-created fake identity documents. FinCEN also noted the use of deepfakes in phishing attacks, specifically those used in scams and business email compromise attacks. As generative AI improves, it will be more difficult (if not impossible) to determine which images or videos are deepfakes, and more FIs will experience deepfake-related fraud. 

This Javelin Strategy & Research impact note underscores the important role banks, businesses, and consumers play in combatting deepfake-related fraud. Banks’ failures to prepare for this explosion of deepfake-related fraud can result in devastating monetary, reputational, and customer losses.