Just as technology and financial systems evolve, the fraud landscape continuously adapts. Criminals are leveraging speed, data synthesis, and generative AI to launch hyper-realistic attacks. For financial institutions and e-commerce leaders, staying informed about these threats is not just a matter of safety, it’s a necessary component of operational resilience.
Seeing how quickly the environment is changing, we need to be honest about what is coming. Here are the key fraud trends shaping the risk environment for late 2025 and early 2026:
1. AI/Deepfakes and Impersonation
Artificial intelligence is reshaping the fraud landscape. What used to take a skilled hacker hours can now be done by anyone with access to generative AI tools. Fraudsters are using voice cloning, fake video calls, and hyper-realistic images to impersonate executives, clients, and suppliers.
- Why it Matters: Deepfake fraud erodes trust between partners and within organisations. This makes traditional red flag detection, like spotting grammar mistakes or unusual email addresses, far less effective.
- What it Causes: Payment authorisation fraud, internal compromise, and a rise in successful social-engineering attacks targeting finance and operations teams.
How to Spot It (Red Flags)
- Unusual Urgency: An executive demanding an immediate, sensitive payment without a standard secondary verification.
- Subtle Visual/Audio Flaws: In video calls, look for poor eye-tracking, unnatural facial movements, or voice inconsistencies (e.g., a strange cadence, robotic tone, or missing ambient sound).
- Mismatching Channels: A voice-cloned call asking you to take action based on an instruction you only received via email. Always use a different, known channel for confirmation.
How to Prevent It (Mitigation)
- Always verify through a second channel: If someone requests a payment or sensitive action, confirm it via a different source (official phone number, Slack, direct call).
- Use strict dual approval: No single person should be able to approve high-risk payments, this blocks fake “urgent” instructions.
- No-exceptions policy for urgent transfers: Urgency cannot override controls. If it’s legitimate, it can wait 2–3 minutes for verification.
- Educate teams regularly: Make sure staff know what AI fraud looks like – short examples and quick refreshers work best.
2. Authorised Push Payment (APP) / Manipulation of the Payer
APP fraud happens when a victim is tricked into transferring money to a fraudster’s account believing it’s a legitimate payment. The growth of instant and 24/7 payment systems makes this type of fraud especially damaging, since the money moves instantly and cannot be recalled.
- Why it Matters: The shift toward instant payments in Europe and globally leaves almost no recovery window.
- What it Causes: Businesses lose funds directly from corporate accounts, often following fake supplier invoices or urgent payment requests. It also leads to reputational damage and costly disputes between clients and payment providers.
How to Spot It (Red Flags)
- Last-Minute Change of Details: A known supplier suddenly contacts you saying their bank account details have changed and that an urgent, immediate payment is required.
- Pressure to Act Immediately: Any communication (invoice, email, call) that emphasizes a critical, unmissable deadline that bypasses internal payment verification processes.
- Suspicious Beneficiary Account: The account name/number provided doesn’t exactly match the expected company or individual, or the bank is located in an unusual jurisdiction for that partner.
How to Prevent It (Mitigation)
- Always verify bank detail changes: Call the supplier using a known, trusted number never the one in the email – to confirm new account details.
- Use “Name Check” where available: Confirmation of Payee / Account Name Verification helps spot mismatched or suspicious accounts.
- Dual approval for new vendors and changes: Two-person approval for creating new suppliers or changing existing bank details prevents most APP scams.
- Have a “cool-down rule”: No urgent payment or bank detail change should be processed immediately; require a short verification pause.
3. Account Takeover (ATO) and Credential Theft
As companies rely on cloud-based platforms and online accounts, criminals target login credentials through phishing, malware, or SIM-swap attacks. Once inside, they behave like legitimate users who change limits, add beneficiaries, or withdraw funds.
- Why it Matters: Because attackers use valid credentials, most traditional fraud systems do not detect anything unusual. To the system, it looks like the real user.
- What it Causes: Direct financial theft, internal data leaks, and unauthorised transactions that appear legitimate, making investigation and reimbursement difficult.
How to Spot It (Red Flags)
- Unusual Login Locations/Times: A login occurring at 3 AM from a country the user has never visited, or from an unrecognized device.
- Unsolicited Alerts: Receiving Multi-Factor Authentication (MFA) or password reset requests that you did not initiate (MFA Fatigue Attack).
- Internal System Changes: Sudden, unexpected changes to account beneficiaries, payment limits, or contact information followed by large or unusual transactions.
How to Prevent It (Mitigation)
- Use strong, phishing-resistant MFA: Move away from SMS codes. Use passkeys, hardware keys (FIDO2), or authenticator apps.
- Risk-based authentication: Trigger step-up verification when something looks unusual (new device, new location, unusual behaviour).
- Enable account activity alerts: Notify users about important changes such as beneficiary updates or login from new devices.
- Use behavioural monitoring: Tools that track typical user behaviour (typing patterns, mouse movements) can detect when a session is controlled by someone else.
4. Synthetic Identities and Fake Business Profiles
Fraudsters are increasingly mixing real and fake data to create synthetic identities that pass automated verification checks. These fabricated profiles are then used to open accounts, issue cards, or onboard as “merchants” that later disappear after processing fraudulent transactions.
- Why it Matters: Digital onboarding and remote KYC create room for identity layering, especially when verification systems rely only on data checks rather than behavioural patterns.
- What it Causes: Systemic risk across the entire payment chain including fraudulent clients, untraceable losses, and regulatory exposure for financial institutions relying on digital onboarding.
How to Spot It (Red Flags)
- Identity Inconsistencies: A new client whose submitted documentation uses real elements but exhibits minor, difficult-to-verify mismatches (e.g., the address is real, but the name doesn’t match official records).
- New Profile, High Velocity: A recently onboarded business or customer immediately attempts to process high-value or high-volume transactions, despite having no prior relationship history.
- Data Scarcity/Isolation: A profile that lacks a credible digital footprint (no matching public records, social media presence, or historical credit data).
How to Prevent It (Mitigation)
- Verify data across multiple sources: Do not rely solely on one document or database. Cross-check with government registries, commercial databases, and trusted third parties.
- Analyse the digital footprint: Check whether emails, phone numbers, domains, and IPs match known fraud networks or appear newly created.
- Use biometric verification: Liveness detection and face matching make it much harder for fraudsters to operate anonymously.
- Apply enhanced review for “thin-file” profiles: When data is unusually limited, require additional documentation or manual analysis.
5. Cross-Border and Instant Payment Exploitation
Fraudsters exploit the speed and jurisdiction gaps of instant and cross-border payments to move illicit funds before detection. Differences in fraud-reporting timelines and regulations between countries make tracing nearly impossible once money leaves the EEA.
- Why it Matters: The faster the payment, the smaller the control window. Instant payment systems are now standard, but risk management often still operates in batch mode.
- What it Causes: Complex money-laundering chains, higher investigation costs, and increased exposure for institutions facilitating fast international transfers.
How to Spot It (Red Flags)
- Chaining of Small/Instant Payments: A sudden increase in a client’s transaction history involving multiple low-value, instant transfers to different international accounts, followed by a large withdrawal (Money Muling).
- Destination Discrepancies: A client/vendor based in one country suddenly requests payment to an account in a different, high-risk jurisdiction without a clear business reason.
- Rapid Fund Movement: Money is received into an account and then immediately (within minutes or hours) pushed out via an instant or international transfer.
How to Prevent It (Mitigation)
- Real-time transaction risk scoring (FI control): Use AI/ML tools to analyse cross-border and instant transfers in milliseconds and flag unusual routing, velocity, or geography before settlement.
- Velocity and route controls (FI control): Apply tighter limits for new or high-risk clients and trigger step-up reviews whenever payment destinations suddenly change.
- Cross-border fraud intelligence sharing (FI control): Use PSD3/PSR data-sharing networks, AML partnerships, and mule-account alerts to detect multi-jurisdiction laundering patterns.
- Verification of new payment destinations (Client control): Clients should confirm any change of bank details or foreign destination using a trusted contact method, not the information in the request.
- Dual approval for international or instant payments (Client control): Clients must require two-person approval for all high-value or cross-border payments to prevent manipulation.
- Caution with urgent foreign requests (Client control): Urgent payment instructions should be treated as high-risk; clients should pause, verify legitimacy, and only proceed after confirmation
Next Steps for Your Business
Staying educated about emerging fraud trends is the first step in adopting protective practices. For businesses in complex or high-risk segments, the solution lies in ensuring your payment infrastructure is built with integrated compliance and real-time monitoring.
If you have any questions or need more information on how to protect your enterprise from fraud, don’t hesitate to contact us. You can reach us at [email protected] for personalized advice and further assistance. We’re here to help you stay informed and secure.
