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With AI tools and cryptocurrencies aiding financial fraud, police and industry are preparing to fight back
The fraudulent practice of “pig slaughter” continues to be a major concern in financial fraud, as highlighted in a recent report by the International Criminal Police Organization (Interpol). These scams exploit emotional connections by masquerading as romantic partners, business associates, or friends. Once trust is established, scammers present victims with seemingly profitable investment opportunities. A pair of arrests in California and a new partnership with the tech industry are a sign of opposition to this practice.
Interpol’s Global Financial Fraud Assessment relationship highlights the use of modern technologies, such as artificial intelligence, to deceive victims by creating deepfakes. Scammers can use deepfake audio and video created with generative AI tools to convincingly impersonate trusted people. Furthermore, large language models can construct coherent and persuasive messages, aiding scammers in their scams.
“The use of artificial intelligence (AI), large language models and cryptocurrencies combined with phishing and ransomware-as-a-service business models have led to more sophisticated and professional fraud campaigns without the need for technical expertise advanced and at relatively low costs”. cost,” the Interpol report states.
A recent one accusation in the Central District of California shows an example of a similar hog slaughter scam involving cryptocurrencies for money laundering. Two Chinese nationals, Daren Li and Yicheng Zhang, have been arrested and charged with laundering a minimum of $73 million through shell companies associated with cryptocurrency investment scams.
The conspirators used several shell companies to open U.S. bank accounts, where illicit funds were transferred from these U.S. bank accounts to other domestic and international accounts and cryptocurrency platforms. Much of the laundered money was converted into Tether (USDT), a stablecoin, and transferred to bank accounts in the Bahamas.
“Complex financial fraud schemes like hog slaughter pose a clear and present threat to the U.S. financial infrastructure as countless Americans continue to fall victim to this predatory activity,” says Deputy Director of Investigations Brian Lambert of the U.S. Secret Service.
Interpol has identified several modi operandi used in financial fraud, including identity theft, investment, romance, prepayment and identity fraud, which represent significant global threats. Identity fraud involves unauthorized access to individuals’ personal information, such as credit card credentials and biometric data, for illicit financial gain.
“We must also encourage greater reporting of financial crimes and invest in capacity building and training of law enforcement agencies to develop a more effective and truly comprehensive response,” Jürgen Stock, secretary general of Interpol, said in a statement.
Coalition of tech companies collaborates on anti-scam strategies
A newly formed coalition, Tech Against Scams, includes tech companies such as Match Group, Coinbase, Meta and Ripple. This group’s goal is to prevent and combat financial scams by providing a united front against online fraud and financial schemes that target consumers across various industries.
In particular, these platforms are among those that can be used by criminals to connect with victims (Match, Meta) or acquire cryptocurrencies that can be used for money laundering (Coinbase, Ripple).
Last summer, Match Group, Coinbase and Meta joined forces to focus on complex scams like pig slaughter. The goal of the collaboration was to leverage each other’s capabilities to identify adversary trends and drive collective action to protect consumers on a global scale. Tech Against Scams relies on investments from these companies. The coalition also plans to work closely with law enforcement agencies around the world.
“The scammers and organized criminal groups behind pig slaughter schemes target people across many internet services, making it difficult for any company to see the full picture of malicious activity and relying on each of us working in silos,” he says Guy Rosen, chief information officer responsible for security at Meta.
Article topics
biometric | cryptocurrency | fraud | Generative AI | Interpol
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