AI-driven elder fraud: Deepfakes; the newest threat
August 12, 2025
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AI-driven elder fraud: Deepfakes; the newest threat
As artificial intelligence (AI) continues to advance, fraudsters are leveraging these tools to exploit one of the most vulnerable groups in our communities, older adults. According to the FBI's Internet Crime Complaint Center (IC3) data, there were $4.88 billion in losses from seniors in 2024. These numbers continue to trend upwards, and the rise of AI-driven elder fraud presents new risks to victims and financial institutions. AI-driven elder fraud involves scams that use artificial intelligence to make attacks against older adults more convincing, harder to detect, and easier to carry out on a large scale. The increased threat requires both awareness and proactive mitigation by banks and credit unions to protect clients and maintain trust in their communities.
The evolving tactics behind elder financial exploitation
Historically, seniors have fallen victim to fraud schemes such as phishing, romance scams, and complex investment schemes. Today's fraudsters are taking scams to a new level by using generative AI tools—such as deepfakes and voice cloning—to impersonate loved ones and create compelling, urgent scenarios. A deepfake is a video, photo, or audio recording that seems real but has been manipulated with AI. Perpetrators often extract voices from social media videos or manipulate photos to craft believable messages. These AI-powered deceptions can lead to hurried decisions by victims, resulting in panicked wire transfers, large cash withdrawals, or the sharing of sensitive account credentials.
In an example of an AI-enhanced grandparent scam, a fraudster might scan public social media profiles to learn a grandchild's name, see that they are vacationing abroad, and note that they call their grandparent "Nana." Using a voice-cloning tool and this easily accessible personal information, the scammer can generate a frightened phone call from the "grandchild" claiming to be in legal trouble and urgently needing bail money. The voice's realism and details make it alarmingly easy to convince the victim to send funds immediately, without stopping to verify the story. The nature of AI-driven elder fraud has made it more difficult to detect using traditional red flags. What once might have seemed suspicious can now appear legitimate, making staff training and innovative detection systems even more essential.
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Connect with an expertWhat financial institutions can do now
Banks and credit unions are uniquely positioned to safeguard older adults through technology and personalized service. Here are some key actions institutions can take to prevent their clients from becoming victims:
- Employ robust fraud detection software: Enhance fraud monitoring systems to flag unusual activity on accounts held by older adults, typically aged 60 and above. Use tailored parameters to detect anomalies like sudden large wire transfers, frequent ATM withdrawals, or new payees that do not align with the client's typical behavior. These targeted settings improve your institution's ability to catch early signs of AI-driven elder fraud and take timely action.
- Train employees to recognize new scams: Equip front-line staff and fraud teams with practical training to identify signs of AI-driven elder fraud. These signs can include clients who appear anxious, confused, or unusually secretive during large transactions, or those referencing family emergencies with limited or inconsistent details. Staff should know how to respond empathetically, ask clarifying questions, and escalate concerns when needed. Regular training helps teams stay alert to evolving scam tactics and reinforces a culture of prevention.
- Clarify communication protocols: Remind clients, especially seniors, that your institution will never request sensitive information like passwords or social security numbers by phone, email, or text. Understanding communication methods is critical as AI-driven scams increasingly use cloned voices and urgent messages to pressure victims. Make it clear that legitimate staff will not use threats or demand immediate action. Encourage clients to hang up, verify requests by calling a published number, and ask questions. Reinforcing this message during visits, alerts, and outreach helps build confidence and reduce the risk of fraud.
- Build trust through relationships: Strong relationships with long-time clients are key to spotting and preventing fraud. Encourage staff to visit clients when something feels off, using a conversational tone to avoid alarming or upsetting the client. For example, saying, "That's a larger transaction than usual. Is everything okay?" can open the door for a helpful discussion. Building trust before issues arise makes it easier to address concerns if signs of elder fraud appear later.
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fraud detection softwareUnderstanding regulatory expectations
Financial institutions are expected to play a central role in identifying and reporting elder financial abuse. With AI-driven elder fraud rising, examiners and enforcement agencies may scrutinize how effectively institutions adapt to emerging typologies. The Financial Crimes Enforcement Network (FinCEN) has named fraud one of its national AML/CFT priorities, emphasizing the importance of proactive detection and reporting. Filing a suspicious activity report (SAR) is just one component; maintaining a culture of vigilance and continuous training is equally critical.
Institutions integrating fraud detection with anti-money laundering (AML) processes are better positioned to respond quickly to evolving threats. AI and machine learning can enhance monitoring by identifying unusual behavioral patterns that are common in modern fraud cases. While operational functions may remain separate, collaboration between fraud and AML teams is essential. Working in silos is no longer effective in detecting complex, AI-driven fraudulent activity.
Community education can prevent losses.
Technology is essential, but it is not the only solution. Many cases of AI-driven elder fraud can be avoided through targeted education and outreach. Consider hosting in-person fraud awareness sessions at senior centers, places of worship, or branch locations, where trusted staff can explain how fraudsters use AI to manipulate voices, images, and personal information. Partnering with local organizations or law enforcement can add credibility and help reach broader audiences. Institutions can also distribute printed guides or quick-reference tip sheets that walk through common scam scenarios, what to look out for, and how to respond. Posting short educational videos on your website or sharing alerts through account notifications and email campaigns reinforces these lessons and helps keep seniors informed between visits. A consistent focus on community education builds trust and positions your institution as a proactive ally in fraud prevention.
Practical tips to share with clients
Educating seniors with simple, actionable steps can go a long way in preventing AI-driven elder fraud. Consider sharing the following guidance during outreach efforts or in printed materials at branches:
- Confirm unexpected requests: If someone claims to be a relative in trouble or a representative from the bank, urge clients to hang up and call back using a known, trusted number, never the one provided in the message or call.
- Be cautious with links and urgent messages: Remind clients not to click on links, download attachments, or send money based on a single phone call, text, or video, even if the message appears to come from a loved one. AI tools can make fake messages seem personal and convincing.
- Enable account alerts: Encourage seniors to set up text or email alerts for large transactions or unusual activity. These real-time notifications can provide an early warning and allow for quick intervention.
- Review account activity regularly: Suggest checking account statements frequently or enrolling a trusted family member to help monitor for suspicious transactions.
Sharing these tips in clear, non-technical language can empower clients to act confidently and avoid becoming victims of increasingly sophisticated fraud attempts.
Protecting seniors in the age of AI
As fraud tactics evolve with AI, so must the strategies used to stop them. Financial institutions have a unique opportunity, and responsibility, to protect older clients through education, collaboration, and well-equipped fraud detection programs. By combining personal relationships with innovative technology and ongoing awareness efforts, banks and credit unions can serve as a first line of defense against AI-driven elder fraud. Staying informed and proactive today means safeguarding trust and financial well-being for the seniors who rely on you tomorrow.
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