Combating Deepfakes in Financial Services: A Call to Action

Imagine receiving a call from your CEO, instructing you to transfer £5 million to a vendor. The voice, the face—everything seems authentic. But what if it’s all an orchestrated illusion? Deepfake technology, once a thing of sci-fi stories, is now a more serious threat to financial institutions than ever. Fraudsters can now bypass traditional security measures with alarming ease, making identity verification crucial across the end-to-end user journey—from onboarding to high-risk transactions.

The Growing Threat of Deepfakes

Deepfakes—AI-generated manipulations of video, audio, and images—have become a preferred tool for cybercriminals. In 2023, deepfake-related fraud cases surged by 3,000% in the U.S., with similar spikes worldwide. Malicious actors use these techniques to impersonate executives, infiltrate job interviews, and manipulate identity verification processes.

One shocking incident saw an executive transfer $25 million after a video call with what appeared to be trusted colleagues—with every present participant orchestrated as a deepfake. This level of deception means even sophisticated security measures can be circumvented, exposing financial institutions to massive financial losses and reputational damage.

Why Financial Services Are Prime Targets

As banks and financial institutions shift to digital-first models, the attack surface expands. Traditional identity verification methods—passwords, one-time passcodes, and basic facial recognition—are no match for AI-powered deception. Deepfakes can be used to:

• Bypass KYC (Know Your Customer) checks

• Defraud loan approval systems

• Manipulate high-value wire transfers

• Create reusable synthetic identities for syndicated crime activity 

Beyond financial losses, deepfake attacks erode customer trust. A single high-profile incident can tarnish a bank’s reputation, reduce investor confidence, and trigger regulatory scrutiny.

The First Line of Defence

To counter deepfake fraud, financial institutions must modernise identity verification capabilities across end-to-end user access journeys.  Such advanced identity verification solutions provide:

• Liveness detection: Ensure that facial recognition systems distinguish between a real person and a synthetic image or video. By analysing micro-expressions and subtle movements, liveness detection can thwart deepfake attempts.

• Record matching: Match presented and verified identity credentials against officially issued government, bank, and/or healthcare records.

• Verified digital credentials: Enable the binding of an individual’s identity to their digital wallet, preventing unauthorised identity manipulation and allowing certified third-parties to increase the level of assurance at the right time, in the right channel. 

Determining What and Who Can Be Trusted

Deepfake fraud prevention requires more than one line of defence. Financial institutions must adopt a layered approach to identity assurance that dynamically adjusts verification requirements based on risk.

With AI-driven fraud detection, enterprises can analyse anomalies in voice patterns, facial expressions, and video inconsistencies in real time to differentiate between legitimate users and deepfake-driven attacks.

Additionally, dynamic authorisation strengthens security by externalising access logic from legacy systems and applications, using contextual data to drive real-time access decisioning. Even if a deepfake bypasses initial authentication, this approach can block unauthorised high-risk transactions.

Empowering Employees and Customers

Technology alone isn’t enough—human awareness is critical. Training employees to recognise deepfake attacks—such as subtle changes in communication style or deviations from standard protocols—can make them more vigilant and less susceptible to deception.

Customers must also be protected. Many financial organisations educate users on emerging scams, and when customers perceive a higher risk, they are more willing to accept security friction—such as verifying unusual requests via secondary channels like direct bank calls.

Securing the Future of Financial Services

As deepfake technology advances, financial institutions must stay ahead with adaptive authentication, digital identity solutions, and continuous education. A robust identity verification (IDV) strategy remains the most effective defence in preventing these attacks.

By embracing modern this approach, AI-driven fraud detection, and dynamic authorisation, the industry can outpace deepfake fraudsters and safeguard both assets and trust in the digital age.

The challenge is clear—but with the right strategy, financial services can mitigate risk, protect customers, and strengthen digital trust.