As the use of AI becomes widespread for sophisticated scams, Experian’s latest identity and fraud report has some insights into how AI is impacting the fraud landscape.
What are the main arguments within the report and what are the main findings? To find out more, Digital Journal spoke with Kathleen Peters, Chief Innovation Officer, Fraud at Experian North America.
Digital Journal: Experian released its tenth annual identity and fraud report this year. How is AI impacting the fraud landscape?
Kathleen Peters: AI is fundamentally reshaping the fraud landscape. On one hand, fraudsters are using AI to create more sophisticated scams, such as deepfakes and synthetic identities. On the other hand, businesses are increasingly understanding the value in leveraging AI to stay ahead of these threats. In fact, our latest Experian U.S. ID & Fraud Report found that there is growing concern over AI-generated fraud and deepfakes, with 72% of business leaders expecting these to be a major challenge by 2026. At the same time, over a third of companies say they are using AI to fight fraud.
Businesses recognise the importance of not only investing in advanced analytics and innovative technology but also continuously learning and adapting to stay ahead of fraud. Building adaptive fraud strategies that evolve with the threat landscape is essential to keeping their businesses safe and maintaining the trust and transparency consumers expect in today’s digital world.
DJ: It seems like AI will continue to play a big role in both perpetuating and protecting against fraud. How are companies adapting to AI and the impact it’s having on their businesses?
Peters: To adapt to the evolving fraud landscape, companies need to rethink their approach to risk management and customer protection. It’s not just about deploying tools but also embedding innovative technology into the core of their operations that simplify and streamline how they analyse data and detect and prevent fraud in real time.
For example, the Experian Ascend Platform is a cloud-based solution that brings together software tools for analytics, credit decisioning and fraud into a single interface. The platform leverages generative AI and enables clients of all sizes and experience levels to pivot between applications, automate processes, modernize operations and drive efficiency. It can also enable clients to add other layers of intelligence, such as behavioral analytics, into their fraud detection capabilities. Behavioral analytics is an important tool in the fight against AI-driven fraud. It helps businesses understand how users interact in real time and helps identify risky or suspicious behavior patterns early in the customer journey.
To build resilient and trusted digital ecosystems, businesses need multilayered, data driven strategies that combine behavioral intelligence with advanced analytics. Leveraging the right mix of technology, data, and insight can help organizations stay ahead of fraud while delivering seamless, secure customer experiences.
DJ: How do consumers feel about interacting with businesses online?
Peters: Consumers have mixed feelings about interacting with businesses online. While digital engagement is now the norm, trust remains a critical barrier. Our latest report found that 57% of people are still concerned about doing things online with their top fears including identity theft, stolen credit card information, and online privacy.
Customers are also raising their expectations for businesses. More than 80% of consumers expect companies to act on security or privacy concerns, and half want stronger online safeguards. Eighty five percent of businesses believe their fraud controls align with consumer expectations but many still rely on traditional verification methods, like passwords and PINs, while more secure methods that people say make them feel safest, like biometrics and behavioral analytics, remain underused.
This underscores the need for businesses to not only invest in stronger fraud prevention measures, but also to communicate clearly and consistently about how they’re protecting their customers.
DJ: What role does trust play for businesses and consumers in today’s fraud landscape?
Peters: Trust is the foundation of every digital interaction, and in today’s fraud landscape, it’s more important than ever. As fraud threats grow more sophisticated, consumers are increasingly cautious about who they engage with online. Our report shows that less than half of people highly trust businesses to address their concerns online, and only 18% fully trust AI-driven tools like chatbots. That trust gap can directly impact customer loyalty and engagement.
For businesses, this means that fraud prevention isn’t just a security issue, it’s a trust issue too. Companies must show they are investing in advanced technologies to detect and prevent fraud, while also being transparent about how and when those technologies are used.
DJ: How can consumers protect themselves online?
Peters: As digital scams become more sophisticated and difficult to spot, staying alert is essential. Consumers can start by using strong, unique passwords and enabling multi-factor authentication whenever possible. It’s also important to be cautious about sharing any personal information and making a habit of monitoring financial accounts for unusual activity.
They should also watch out for common fraud tactics like phishing emails, fake websites, and unsolicited messages asking for sensitive personal data. Consumers should look for signs of legitimacy, such as secure website connections and verified sources. If something feels off, people should trust their instincts and report anything suspicious.
