The technology behind artificial intelligence has been around for years, but it didn’t truly capture the mainstream imagination until OpenAI released ChatGPT on Nov. 30, 2022. ChatGPT became the fastest-growing consumer app in history after reaching 100 million users in its first two months. Most industry leaders, entrepreneurs and economists now concur with Bill Gates that AI is the most revolutionary technology in decades, predicting that “entire industries will reorient around it. Businesses will distinguish themselves by how well they use it.”
Another group that agrees with Mr. Gates is cybercriminals.
October is Cybersecurity Month, so this is a good time to talk with your clients, especially high net worth (HNW) individuals and their family, about how AI is changing the fraud landscape, giving scammers new tools and opportunities to steal identities, data and assets.
Cybercrime against individuals is on the rise. According to the Federal Trade Commission, individuals reported losing more than $12.5 billion to fraud in 2024. That’s a shocking 25% increase over the prior year.
A recent report by the Identity Theft Resource Center detailed that impersonation scams increased by 148% in the past year, surpassing all other types of identity-related fraud. Individuals need to protect themselves as much as possible, and as a trusted advisor, you can highlight the growing problem.
Impersonation scams have been around forever, but the shift today is driven by increasingly sophisticated tactics and the growing use of digital and AI technologies.
How AI Helps Scammers
Like with legitimate businesses, AI is making criminal enterprises more effective, efficient and easier to scale.
Fraudsters are using AI to mass-produce convincing scam content, including deepfake photos, audio and video that are difficult to distinguish from the real thing. AI can also create fake websites and emails that seem real. AI is being used by criminals to personalize attacks better than ever before. AI tools can even be used to clone the voice of a family member, friend or business associate, then use that fake voice to ask for money for an “emergency.” The degree of accuracy AI can add makes these scams harder to detect and easier to fall for.
Your wealthy clients can be the targets of cybercriminals using AI-enabled hacking methods to steal their assets, identities and even corporate data. Given the sheer volume of publicly available information, wealthy families must pay close attention to their cybersecurity approach.
The amount of publicly available information online, along with access to large sums of money and sensitive data, can make HNW individuals ideal targets — victims of financial theft, extortion and identity theft. Affluent individuals may be more likely to pay extortion demands, encouraging ransomware attacks.
How HNW Clients Can Protect Themselves From Threats
As AI-enabled cybersecurity threats continue to evolve, HNW individuals must take proactive steps to protect their safety, privacy and legacy. Your wealthy clients may face a higher risk of identity theft and other fraud because they tend to be more publicly visible and have larger digital footprints. To help your clients avoid being victims, you may want to include these suggestions in your next client meeting.
HNW individuals must take proactive steps to protect their safety, privacy and legacy.
Create a plan. Suggest your clients create a family codeword or secret question that must be provided before any money is wired or transferred. This can prevent a criminal from successfully stealing funds by using deepfake audio or video to impersonate a family member.
Be careful on social media. If your clients need to be on social media, caution them to limit the information they post, including photos, videos and audio clips. Recommend they use strict privacy settings and require new followers to be approved.
Turn on multifactor authentication. To enhance password security, suggest they enable multifactor authentication, which sends a one-time passcode to their phone when they log in, especially for accounts related to their finances. It’s an extra step, but it’s worth the effort.
Consider a trust to help shield assets. Among other uses, a trust can conceal your clients’ personal details. This can add an important layer of protection against cybercriminals who use open-source intelligence to collect publicly available information to craft scams.
Engage a cybersecurity specialist. You may want to inform your HNW and ultra-high net worth clients that there are private security companies specializing in protecting the digital presence of wealthy individuals. These firms can conduct risk assessments, penetration testing and monitor threats.
Don’t forget to think about your own vulnerability during Cybersecurity Month.
As you caution your clients about the dangers of cybercrime, don’t forget to think about your own vulnerability during Cybersecurity Month. While AI can be used for nefarious ends, it can also help identify, prevent and remediate cybersecurity issues. As an independent financial advisor, make sure you partner with an outsourced cybersecurity expert who understands your current business protections, benchmarks your security against industry best practices, designs a security plan specifically for your business and implements an action plan.
Sid Yenamandra is the Founder and CEO of SurgeONE.ai, a compliance, cybersecurity and data services platform for wealth management that unifies the offerings of RegVerse, Kovair, Security Snapshot and MGL Consulting.
