Synthetic Identity Is the New Attack Surface: What Organizations Must Understand

The rise of artificial intelligence has transformed many aspects of our lives, but it has also created a new battleground for fraudsters. Synthetic identity fraud is no longer a niche threat; it has become the default attack surface in the AI era. Criminals now use AI tools to create convincing fake identities, manipulate voices, and generate deepfake videos that deceive even the most cautious organizations. This shift has expanded the range of victims to include executives, families, law enforcement, and government agencies. Without a universal standard to verify human authenticity, organizations remain vulnerable to these sophisticated attacks.

AI-generated synthetic face on digital screen

How Synthetic Identity Fraud Has Evolved with AI

Synthetic identity fraud traditionally involved combining real and fabricated information to create a new identity. Fraudsters used this to open bank accounts, apply for loans, or commit tax fraud. AI has supercharged this tactic by enabling the creation of highly realistic synthetic identities that are difficult to detect.

• Deepfake CEO Fraud: Attackers use AI to create videos or audio clips that mimic a CEO’s voice and appearance. In one notable case, a UK-based energy firm lost $243,000 after its CFO was tricked by a deepfake voice impersonating the CEO’s urgent request for a wire transfer.

• Generative Voice Scams: AI tools can clone voices from short audio samples. Scammers call employees or family members, impersonating trusted individuals to extract sensitive information or money.

• AI-Enabled Financial Crimes: Automated bots generate synthetic identities at scale, opening fraudulent accounts or laundering money. These AI systems adapt quickly to detection methods, making prevention challenging.

  
  

The Scale of the Problem

The scale of synthetic identity fraud is staggering and growing rapidly. According to a 2023 report by the Federal Trade Commission (FTC), identity theft complaints increased by 45% compared to the previous year, with synthetic identity fraud accounting for a significant portion. The Financial Crimes Enforcement Network (FinCEN) reported a 30% rise in suspicious activity reports linked to synthetic identities in 2022.

• Synthetic identity fraud costs the U.S. economy an estimated $6 billion annually.

• Over 80% of financial institutions reported an increase in synthetic identity fraud attempts in the past two years.

• Law enforcement agencies face challenges tracking these crimes due to the complex, AI-generated nature of the identities.

  
  

Why Victims Now Include Executives, Families, Law Enforcement, and Government Agencies

The reach of synthetic identity fraud has expanded beyond traditional financial targets. AI tools enable attackers to impersonate high-profile individuals and trusted community members, increasing the range of victims.

• Executives: Deepfake CEO fraud targets company leaders to authorize fraudulent transactions or leak confidential information.

• Families: Generative voice scams trick relatives into sending money or revealing personal data.

• Law Enforcement: Fake identities complicate investigations and can be used to infiltrate agencies or discredit officers.

• Government Agencies: Synthetic identities are used to access sensitive systems, submit fraudulent benefits claims, or manipulate public records.

  
  

This broad victim base reflects the sophistication of AI-enabled attacks and the lack of reliable ways to confirm genuine human identity.

The Challenge of No Universal Human Authenticity Standard

One of the biggest reasons organizations remain exposed is the absence of a universal standard for verifying human authenticity. Current identity verification methods rely on documents, biometrics, or behavioral data, but AI-generated synthetic identities can bypass these controls.

• Document Forgery: AI can create realistic fake IDs and passports.

• Biometric Spoofing: Deepfakes can mimic facial expressions or voice patterns used in biometric systems.

• Behavioral Mimicry: AI models can simulate typing patterns or interaction styles.

  
  

Without a common framework to prove that a person is real and not AI-generated, organizations face an uphill battle in AI fraud prevention. This gap allows fraudsters to exploit trust systems and evade detection.

What Organizations Can Do to Protect Themselves

To address synthetic identity fraud effectively, organizations must adopt a multi-layered approach:

• Invest in AI Detection Tools: Use AI-powered systems that analyze inconsistencies in biometric data, voice patterns, and video authenticity.

• Enhance Employee Training: Educate staff about deepfake scams and generative voice fraud to recognize suspicious requests.

• Implement Stronger Verification Processes: Combine multiple verification factors, including live interaction checks and cross-referencing data sources.

• Collaborate Across Sectors: Share threat intelligence with other organizations, law enforcement, and government agencies to track emerging synthetic identity fraud trends.

• Advocate for Standards: Support efforts to develop universal human authenticity standards to improve trust and security.

  
  

Moving Forward in the AI Era

Synthetic identity fraud is no longer a distant threat but a present danger that affects a wide range of individuals and organizations. The AI era has made it easier for criminals to create convincing fake identities and launch sophisticated attacks. Without a universal standard to verify human authenticity, organizations must remain vigilant and proactive.