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Identification, account number, and…proof that you, bank customer, inhabit a corporeal form?
A report from Deloitte predicts that banks could take a big hit from fraudsters using deepfakes, voice cloning, and other hyperrealistic AI content to scam banks out of money. The consultancy predicts that generative AI could enable losses from fraud to reach $40 billion in 2027—up from $12.3 billion in 2023—a compound annual growth rate of 32%.
“Generative AI offers seemingly endless potential to magnify both the nature and the scope of fraud against financial institutions and their customers,” the authors wrote in the report. “It’s limited only by a criminal’s imagination.”
The ballooning potential for bank fraud comes as generative tools have made AI mimicry more accessible than ever. While AI generation can sometimes be hard to definitively detect, experts say it’s clear that the tech has stoked a range of cybercriminal activity, from nonconsensual deepfake porn and fraudulent advertising to election manipulation.
Another report this week found that 67% of respondents said they were concerned about the use of deepfakes and voice clones in the banking and financial sector.
Insured against AI: As the risks of AI grow, Deloitte also forecasts the rise of a new type of insurance market. Consider, the report asks readers, taking a self-driving car to the doctor to get an AI-powered diagnosis and an AI-assisted surgery. This scenario could lead to a lot of new types of insurance claims, the report claims. The authors say AI insurance “may be a blue ocean opportunity” for the industry and predict that the market for AI insurance premiums could grow to $4.7 billion by 2032.
Banking on AI: The rising potential for fraud also comes as financial institutions themselves are experimenting with how AI might be put to work on everything from summarizing earnings information to customer service and gauging risks.
But Treasury Secretary Janet Yellen warned this week that such adoption could come with “significant risks” for the financial sector, according to her prepared remarks. Yellen also announced that the department is kicking off a formal public request for information on the opportunities and dangers of AI in the financial system.
Deloitte doesn’t expect this pace of adoption to let up; by 2027, the consultancy believes that generative AI-enabled applications is likely to become the leading source of advice for retail investors.
“The growth of generative AI marks the first time a technological revolution of this magnitude has been so widely accessible, so quickly,” the authors write. “GenAI tools are available to anyone with an internet connection.”