Summary of this article
Centre warns of AI-driven identity fraud risks.
Deepfakes may bypass Video-KYC and authentication checks.
Banks urged to strengthen deepfake detection systems.
The Indian Cyber Crime Coordination Centre (I4C), under the Ministry of Home Affairs, has issued an advisory warning financial institutions regarding the rise in AI-driven identity fraud targeting digital financial systems.
Issued by the National Cybercrime Threat Analytics Unit (NCTAU), the advisory stated that cybercriminals are using artificial intelligence (AI) to create deepfake videos, cloned voices and synthetic identities that can be used to bypass identity verification systems. These techniques could be exploited to circumvent facial authentication, liveness verification, Video-KYC checks and account recovery processes used by banks, fintech firms and other digital service providers.
How Fraudsters Collect Identity Data
The advisory said, criminals often approach potential victims through social media platforms, messaging applications, online job portals, dating websites and phone calls. During such interactions, they may persuade individuals to look into a camera, turn their heads, blink or speak.
The advisory comes amid rising concerns over AI-enabled fraud. Data from identity verification platform Sumsub showed that deepfake incidents in India rose by 280 per cent year-on-year in the first quarter of 2024.
Separately, a study by cybersecurity firm McAfee found that 47 per cent of Indian adults had either encountered an AI voice-cloning scam or knew someone who had. Among those affected, 83 per cent reported financial losses, while nearly half said they lost more than Rs 50,000.
Advisory Recommends Stronger Safeguards
The government has advised banks, fintech companies and other organisations involved in customer onboarding to deploy systems capable of detecting deepfakes and other forms of synthetically generated content.
For consumers, the advisory recommends securing biometric credentials wherever possible, monitoring alerts related to authentication attempts and reporting suspicious financial activity without delay.
It also advises users to immediately contact their telecom service provider if their mobile network stops functioning unexpectedly, as this may indicate a SIM swap attempt.
The advisory said the warning is intended to raise awareness about emerging fraud techniques and should not be interpreted as evidence of a breach at any specific institution or platform.
