Even if you’ve never personally received one of those scam phone calls or messages about a surprise tech support issue, a fantastic crypto investment opportunity or a sudden romantic interest, chances are you know someone who has. Maybe even a client?
But ever wonder where these calls come from, who’s behind them, and why they’re so successful?
As an advisor, you don’t just have the challenge of protecting your clients, and maybe even their families, from the surge in scams, but also protecting yourself and your family. And in this case, a little knowledge is certainly not a dangerous thing.
Where In The World
Most scam and fraud calls originate from rundown factories in the slums of India, far away from the attention of international law enforcement. It’s believed that close to half of these scam calls come from well-organized call centers in just one city, the remote city of Kolkata (formerly Calcutta) in the eastern India province of West Bengal and not far from the border with Bangladesh.
Some of these centers employ hundreds of locals, many of them well-educated engineers and computer scientists who are either underemployed or unemployed. There are thousands of these call centers and a single one can generate more than $100,000 every day for their operators. According to the FBI, U.S. seniors alone are duped out of more than $10 billion every year just by India-based call centers, and the losses usually go far beyond financial.
India isn’t the only culprit. Cartels run these call centers in Mexico, equally ruthless gangs run them in Cambodia, and in spite of the war, it’s believed that hundreds if not thousands of these centers are still operating in Ukraine. In a single 60-day operation in 2022, Interpol raided more than 1,700 of these centers in more than 70 countries and yet it made little difference.
Every day these crooks churn out millions of calls that bilk millions of victims out of billions of dollars. If you haven’t personally received one of these calls yet, you probably will soon, and the chances of you falling for one of these scams are higher than ever. And that’s all thanks to AI.
AI Will Replace The Weakest (And Most Expensive) Link
The greatest weakness of these call centers is people. Not only are people their greatest expense, but the coming and going of the people making the calls can often give their operations away to law enforcement. And in many of these scam calls, the only telltale that it’s a scam is the heavy Indian or Filipino accent. Does that really sound like Robin from Microsoft in Seattle, or Chuck from a wealth management firm in Wisconsin?
But thanks to the rapid advances in AI, the operators of these call centers will be able to eliminate those problems. Reduce 90% of their costs by eliminating the need for people, and dramatically increase the believability and plausibility of the calls. That will mean even bigger profits on the backs of more victims and even more incentive for criminals to ramp up their efforts.
The sudden and rapid growth in conversational AI means that the voice on the other end of the line will sound very real and very local, will be able to develop friendships and trust, look for clues about background or mood from the conversations, inject snippets from the latest news to make themselves feel real, inject things like tone, gender, a familiar accent, slang, emotion, even humor.
Those massive and costly call centers full of people and equipment could be reduced to a handful of computers locked away in somebody’s bedroom. This kind of profit opportunity will only attract more criminal organizations and lure and con more victims.
We’re already seeing it happen. In the 12 months since the launch of ChatGPT, phishing emails surged by nearly 1,300%, and their quality was the best we’ve ever seen. Over that same timeframe, AI-aided identity fraud surged nearly 1,800%. And AI operated news sites, often used to push out misinformation, disinformation, and propaganda, grew from 40 sites to nearly 600.
There’s no easy solution, no silver bullet. We expect to see wave after wave of believable and plausible scams that will be almost impossible to identify at first glance.
It Doesn’t Mean We're Helpless
In almost all of these scams, the giveaway, the telltale, the warning sign, is context. No matter how convincing the voice at the other end of the line is, is it really normal for Microsoft to be calling you out of the blue about a virus they found on your computer?
Should you really be sending money to someone you only recently met on social media and who seems to have taken a very quick romantic interest in you?
Since when do the local courts or police departments want you to pay a fine using Zelle or a gift card?
If crypto investments are really so lucrative, why is this complete stranger offering such a massive return on your investment with near zero risk?
Does your client really want you to suddenly and secretly wire $25 million over the weekend to very unfamiliar accounts? (Yes, it’s happened and it worked.)
In a world where trust is already in decline, it’s going to have to take another beating. Trust nothing at first glance. Verify once, then twice, and depending on your client’s tolerance for friction, verify again.
Or better yet, simply ignore the pitch. If it’s genuine, the caller will find a more trustworthy way to find and interact with you.
Shield’s up!
Neal O’Farrell is widely considered to be one of the longest-serving security experts on the planet, 40 years and counting. He’s advised half a dozen governments, has led the fight against identity theft for more than 20 years, and started his career by taking on the NSA in what became known as the Crypto Wars.