5 ways fraud is reinventing itself in 2025

By Bess Farrell, Senior Product Manager, GBG

Our online spaces are changing. Fast.

Web and app traffic is surging, online retail is a resounding success, and digital payments are becoming the norm.

These changes are a boon for companies and the consumers they serve.

At the same time, fraudsters, empowered by novel technologies and shifting tactics, threaten to undermine brands’ potential to build trust and grow securely.

Here are the top five fraud trends your business can’t ignore in 2025.

#1 Security > Convenience

Customer experience is everything. It’s the metric that informs purchasing decisions, catalyzes loyal customers, and drives business growth.

Put differently, it’s typically the differentiating factor separating successful brands from their competitors. Often, this means brands must provide a quick, seamless onboarding process that minimizes friction for new customers, builds immediate trust, and encourages early engagement.

However, in today’s fraud landscape, customers are rethinking this priority.

According to GBG’s latest Fraud Report, business executives say balancing fraud detection with friction is the greatest challenge to fraud prevention.

In the process, many misunderstand their customers’ priorities, as 57 percent believe that a quick and easy onboarding process is most important to consumers.

In reality, consumers are more concerned about security. Nearly 70 percent of consumers place greater importance on protecting an onboarding process compared to how quick and easy it is.

This doesn’t mean that brands can afford a clunky or inefficient onboarding or identity verification process. However, in the year ahead, brands can give extra care to identity verification, seeing it as a critical component of their customer experience value proposition.

#2 Generative AI fuels fraud attempts

Generative AI (GenAI) is everywhere. From high-profile marketing campaigns to new product features, the technology is impossible to ignore.

Fraudsters agree, and they are leveraging the technology, which excels at generating human-like and convincing content that’s detailed and crafted to bypass traditional detection methods.

With powerful GenAI tools easy and affordable (free) to access, fraudsters are quickly making familiar fraud types, like synthetic identity fraud (SIF) and phishing scams, more convincing and scalable than ever before.

As a result, GBG’s latest fraud report found that executives say GenAI is the biggest trend in identity verification and fraud detection over the next three to five years.

Specifically, business leaders fear more accurate synthetic identities, an increased volume of phishing/smishing, and more convincing fake IDs since Gen AI can quickly generate human-like text, realistic images, and even deepfake videos at scale, allowing fraudsters to create believable synthetic identities and phishing emails and texts with ease.

This isn’t just a future-focused fear.

More than half of companies say synthetic identity fraud (SIF) has increased or stayed the same in their businesses.

Fraudsters aren’t innovating. Instead, they’re evolving, using new technology to enhance their ability to commit well-known forms of fraud.

#3 Fraud is an omnichannel problem

As consumers flocked to digital channels, mobile and online fraud spiked. While these channels remain top targets for fraudsters, bad actors increasingly take an omnichannel view of fraud, targeting contact centers and in-person channels alongside traditional digital fraud targets.

Notably, as fraudulent payment methods, accounts, and identities exploit vulnerabilities in an interconnected system of online and offline channels, a holistic, multi-layered approach to identity verification is essential.

#4 Fraud becomes more costly (and consequential)

Fraud is expensive.

According to an analysis by the Association of Certified Fraud Examiners (ACFE), businesses worldwide lose an estimated five percent of their annual revenues to fraud.

It’s also getting more costly.

In 2024, 22 percent of brands responding to GBG’s Fraud Report survey said they experienced high-dollar value fraudulent transactions exceeding $50,000 surged, a seven percent increase since 2020.

Of course, the financial costs are just the beginning. Its repercussions can disrupt operations, damage reputations, and erode trust within and outside an organization.

#5 Fight AI generated deepfakes

GenAI is empowering fraudsters. Now, AI is also highly capable of creating hyper-realistic images, video and audio to disguise digital appearance. Fraudsters are using this technology to create very convincing applications complete with manipulated or tampered documents and accompanying deepfake videos to trick biometric checks

However, as technology advances in manipulating and imitating biometric markers, identity verification systems are in turn enhancing their defenses against deepfakes.

There are a number of ways to detect and stop deepfakes, including:

1. 1. Passive liveness detection – these checks confirm whether a face is real and live without requiring actions like turning your head, smiling, or blinking into a device camera. This technology uses subtle indicators such as skin texture, blood flow, and natural lighting to ensure a person is genuinely present and not a deepfake image or screen replay. It’s faster and requires less processing power than active liveness detection, as it only needs a single image instead of a video feed to meet the highest ISO standard for liveness detection. Ultimately, this creates an efficient UX onboarding journey for prospective customers.
   2. Injection attack detection – This technology monitors the integrity of the camera feed used in the biometric authentication process. It involves advanced biometric security measures that analyze both the camera hardware and software for indications of non-standard cameras or any modifications to the system code that could suggest a ‘man-in-the-middle’ attack. These measures ensure that the identity proofing process remains secure.

Protecting customer experiencing by fighting fraud

Modern brands compete on experience. Either customers have a safe, compelling experience, or they leave.

It’s an unassailable reality for today’s businesses. Innovation is enabling brands to conduct more intelligent onboarding, leveraging collaborative cross-industry intelligence to empower businesses to evaluate risk and remain competitive.

For example, tapping into a global data intelligence network with millions of identity data records across industries can reveal useful insights without breaking data privacy. With this insight, businesses can not only identify repeat fraudsters, who are attacking multiple organizations at the same time, with the same tactics, but also identify good and great customers and onboard them with less friction.

As fraudsters evolve, the stakes for businesses rise, and protecting the customer experience becomes even more difficult (and important).

To protect the customer experience, fight fraud effectively. Prioritize security, embrace AI tools, and take a multi-layered approach to identity verification. Layered, real-time identity verification technology that combines AI, human fraud experts, and robust data sources can mitigate risks posed by AI-powered fraudsters. This approach also enables businesses to effectively manage risk while offering an enhanced customer experience through progressive checks, which in turn can increase customer confidence.

These steps are an effective antidote to the fraud threats that put companies of every size and sector at risk.

About the author

Bess Farrell is a Senior Product Manager at GBG, a leading global identity and location technology provider.

Article Topics

AI fraud  |  biometrics  |  fraud prevention  |  GBG  |  generative AI  |  identity verification  |  user experience