By Chris S. Nishiwaki
NORTHWEST ASIAN WEEKLY
Financial fraud, aided by generative artificial intelligence (AI) is in the double digits of billions of dollars and on the rise, according to experts. Many fraudsters target seniors, non-native English speakers, and, often, Asian immigrants.
Banks such as JP Morgan Chase are countering such fraud with consumer education and advocacy seminars throughout the region. Rocky Fong, vice president of community and business development for JP Morgan Chase’s Seattle Market, and Det. Derek Sandbeck, of the Seattle Police Department Elder Abuse and Financial Exploitation Division, shared advice on how to prevent such fraud during a Feb. 12 workshop at Kin On.
Rocky Fong speaks at Chase Bank’s fraud prevention program. Courtesy of JPMorganChase.
“Fraud and scams have really been out there in the general public for the longest time,” Fong said. “With technology, criminals have become more savvy on how they want to approach people.”
Deloitte’s Center for Financial Services study predicts that generative AI could enable a fraud loss of up to $40 billion in the U.S. by 2027, representing an almost $28 million increase in fraud loss in just four years from 2023. That’s a compound annual growth rate of 32%.
The Wall Street Journal also reported that “(d)eepfake incidents in the fintech sector increased 700% in 2023 from the previous year, according to a recent report by identity verification platform Sumsub.”
“The criminals prey on the role of loneliness,” Fong said. “They try to be somebody through various approaches, via technology and scam channels. They try to build a relationship. When they get close enough, that’s when they try to strike.”
Chase operates over 65 branches in King County, including the in-store branch at Uwajimaya in the Chinatown-International District, one on 23rd Avenue South and South Jackson Street, and another on Martin Luther King, Jr. Way South and South Myrtle Street. All of these locations largely serve Asian American and Pacific Islander communities.
Chase shared the following advice to help spot scams and protect your finances:
- Be cautious with strangers: Stick to connecting with people you know on social media, and be wary of anyone who’s hesitant to meet in person. Don’t share personal financial details, and protect your privacy by blocking unwanted texts and calls.
- Verify identities: Online dating is popular, but it’s important to do your homework. If someone has very few photos and avoids video calls or meeting up, be suspicious about sharing personal information.
- Be skeptical of sob stories: Be cautious if someone you’ve met online shares a dramatic or urgent story and asks for financial help. Scammers often use emotional manipulation to exploit your kindness. Common tactics include claiming a family crisis, like a medical emergency, or needing money for a plane ticket to come and see you. These stories are designed to tug at your heartstrings and prompt you to act quickly without thinking it through.
- Don’t send money: Avoid sending money to anyone you’ve only spoken to online or by phone. This includes not just traditional methods like bank transfers, but also peer-to-peer (P2P) payments, wire transfers, cryptocurrency, or gift cards. Scammers often request these forms of payment because they’re hard to trace and recover.
- Be wary of payment requests: If someone you’ve met online asks for financial help, especially through unconventional payment methods, consider it a major red flag. Scammers often use emotional stories to manipulate you into sending money.
- Protect personal information: Avoid sharing sensitive personal information, such as your address, financial details, or social security number with someone you haven’t met in person.
- Trust your instincts: You know that phrase, “It’s not you, it’s me”? In the world of romance scams, it’s often true. Scammers might try to make you feel paranoid if you express discomfort. Trust your gut and don’t hesitate to ask for help if something feels off.
- Beware of urgency: If someone is rushing things, take a step back and think about why. Over-the-top affection early on could be a tactic to manipulate you emotionally and financially. Always question the motive behind the fast pace.
Other players in financial services are getting into the fraud protection game, too.
According to the trade publication American Banker, “Swift, the international payments messaging organization, is in the middle of building a new AI model with several technology partners, including Google and Microsoft, according to Kalyani Bhatia, global head of payments.”
The credit card giant MasterCard is applying AI of their own to fight generative AI-aided fraud. MasterCard said in a statement that “(ne)ew generative AI technology will scan an unprecedented one trillion data points to predict whether a transaction is likely to be genuine or not, building Mastercard’s existing ability to analyze account, purchase, merchant, and device information in real time.”