AI can remove tell-tale signs of imposter scams such as poor grammar and typos, making education for consumers more important than ever.

“A criminal can now create a convincing voice, video, photograph, text message, advertisement or online persona with little technical skill and at very low cost,” Paul Benda, executive vice president for risk, fraud and cybersecurity at the American Bankers Association, said in testimony before the U.S. Senate’s Special Committee on Aging on July 29.

“Generative AI is not replacing traditional scams — it is industrializing them,” Benda said.

Consumers lost $3.5 billion to imposter scams in 2025, according to a June 15 report from the Federal Trade Commission. These reported losses have nearly tripled since 2020, the FTC said.

Imposter scams involve bad actors pretending to be a family member, bank representative, government official or other trusted individual to trick victims into giving them money.

Fraud on the rise

Some 49% of respondents to a survey released June 30 by business and technology consultancy Capco said they had experienced some type of payment fraud — successful or thwarted — in the past two years.

“We expected that number to be much larger, which is telling us there are many individuals who don’t even realize that they’ve had fraud perpetrated against them — or attempted, at least,” Gregg Henzel, managing principal of U.S. financial crime, risk, regulation and finance at Capco, told FinAi News.

This just shows that consumers, especially those older than 55, need to be better educated, Henzel said.

The survey showed that 53% of respondents 55 to 65 years old do not recall being informed about deep-fake AI scams, while 26% of respondents 25 to 35 said the same.

Risks for different age groups

Older consumers are usually more vulnerable to imposter scams because they often know less about AI-supported fraud and can be less comfortable with online banking, whereas many younger consumers understand online banking and might not even know how to write a check, Henzel said.

But age alone isn’t the only factor in determining risk, he said.

For example, technological confidence can be a detriment, according to survey results released July 28 by Toronto-based TD Bank.

Though 89% of Canadian Gen Z respondents said they are confident in spotting fraud, 65% also admitted to behavior that makes them more vulnerable to fraud — well above the survey average of 52% for all age groups.

“Confidence can be a double-edged sword when it comes to fraud prevention,” Tarundeep Dhot, vice president of fraud management at TD, said in a July 28 release.

“Overconfidence can sometimes lead to quick decisions or overlooked warning signs that scammers rely on.”

Along with consumer education, FIs should use the latest technologies, including AI, and know-your-customer analytics to detect and prevent fraud, Benda said in his testimony. And the government can help by strengthening telecommunications safeguards and improving information sharing.

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