AI-based financial scams: Set a family code word for emergency requests

Pause and verify the caller's identity independently before transferring funds

Artificial intelligence (AI) is rapidly changing the nature of financial fraud. What once depended on generic scripts and human effort now runs on scale, speed and hyper-personalisation. That combination is making scams cheaper to run, harder to spot, and broader in impact, making it essential for people to be aware and on guard.

 

Personalisation and scale 

The biggest shift is personalisation at an industrial scale. Scammers now use AI to analyse public information and social media patterns to understand how people communicate and behave. Large language models scrape a victim’s online footprint and tailor outreach to the maximum extent possible. “AI enables criminals to convincingly replicate an individual’s voice, likeness and written communication style using publicly available data,” says Ravindra Baviskar, director, sales engineering (India and SAARC), Sophos, a cybersecurity firm. 

“AI adapts to the potential victim’s responses and navigates a conversation to make it more believable,” says Vivek Iyer, partner and financial services risk advisory leader, Grant Thornton Bharat. As a result, the message sounds familiar and urgent, and the instinct to doubt drops. 

AI also expands reach. Traditionally, fraudsters relied on significant human effort, which limited both reach and effectiveness. “One scammer can simultaneously target hundreds or thousands using AI chatbots and voice bots,” says Dip Mehta, partner, EY Forensic and Integrity Services.

 

AI-powered attackers can operate 24/7, respond instantly and confidently without fatigue. They can also understand several languages and adapt in real time to a victim’s responses.

 

“Criminals continuously learn which emotional triggers prompt faster payments,” says Baviskar. As a result, the speed and success rate of financial frauds have increased significantly.

 

Popular AI-enabled scams 

Voice-cloning and impersonation: In these scams, the fraudster impersonates a distressed family member, an office senior, a colleague, or an authority figure. The attacker first scrapes voice samples from social media, past calls, an existing chief executive officer (CEO) interview, or a short clip shared online. “The victim receives an urgent call, often from a new number. It could be from a son claiming to have fallen prey to an ‘accident’. It could come from a boss about a deal that must close immediately, or a vendor payment that cannot wait,” says Mehta. The scam succeeds by combining pressure with secrecy. Once payments are made via UPI or banking channels, the money is moved across multiple accounts or converted.

 

Investment and trading scams: These scams often begin with lures on social networks, messaging platforms and online communities. Promises of consistent or unusually high returns are made, with endorsements from seemingly credible experts who appear professional and knowledgeable. The operation frequently relies on messaging groups, fake apps, cloned trading dashboards, fake testimonials, scripted engagement and repeated deposits. Some versions use AI-generated videos or images of known personalities to promote fake trading platforms.

 

This scam tends to follow a set pattern: the victim is added to a messaging group; AI bots posing as investors post fake profits daily; a fake app or dashboard shows ‘returns’; a small withdrawal is allowed to build trust; then larger deposits are encouraged. “When the victim tries to withdraw a meaningful amount, it gets blocked, citing reasons such as ‘tax’, ‘unlock fee’ or ‘margin’. The platform then disappears, and funds get routed via mule accounts or crypto,” says Mehta.

 

Romance scams: Romance scams are rising. An AI chatbot initiates contact on dating or social media platforms and sustains emotional engagement over weeks. Trust is gradually built using personalised responses, then financial distress or an ‘investment opportunity’ is introduced. Requests for money transfer are framed as help or planning for a joint future.

 

Job, freelance and sale-season scams: Job and freelance scams target job seekers through realistic offer letters, fake interviews and onboarding processes. They are designed to extract fees or personal data. 

Another fast-growing risk arises during sale seasons. “It involves AI-generated fake websites, QR codes and apps that closely resemble legitimate shopping platforms,” says Vaibhav Tare, chief information security officer, Fulcrum Digital, an IT services and digital engineering company.

 

The common playbook 

Across scam types, the structure and sequence are similar. Scammers rely heavily on digital communication to build rapport and trust. Early in the interaction, they push indicators of credibility—fabricated profit screenshots, counterfeit company records, or repeated one-on-one engagement. “Once trust is established, they introduce urgency through limited-time offers, emergencies or exclusive opportunities,” says Baviskar. Victims then get pushed to send money quickly, which then vanishes via hard-to-trace channels such as layered bank transfers or cryptocurrency.

 

Practical steps to protect yourself 

For individuals and families:

 

If a distress call comes in, disconnect and dial back the saved or known number. Never trust incoming caller IDs; they can be spoofed. Treat unsolicited financial communication as suspicious by default.

 

Put a verification system in place: set a family safe word that must be cited for emergency fund requests.

 

“Families should openly discuss scam tactics, especially with elderly members,” says Tare.

 

Slow down: verifying an urgent request through a trusted, independent contact method remains one of the strongest defences.

 

Set daily transaction limits and alerts, so a single moment of panic does not empty your account. Never share OTPs, credentials or screen access.

 

For small businesses: Build process friction into payments. Make dual approval mandatory for transfers, including verbal and email approvals.

 

Do not accept payment instructions over messaging platforms alone. Treat bank detail changes of vendors as high-risk and verify them independently. Train staff specifically on AI-based impersonation fraud.

 

Investment safeguards: When dealing with a financial planner or wealth adviser, ask for regulatory registration details. “Seek references about the planner or adviser from other investors. Make sure the person has an office and verify their performance history,” says Iyer.

 

Avoid clicking links or downloading apps shared through messaging platforms.

 

If you have transferred money

• Contact bank or UPI app immediately; request transaction freeze or reversal
• Disable compromised accounts; block debit or credit cards
• Report quickly via cybercrime.gov.in or 1930 and trigger account tracing
• Preserve evidence (audio, chats, screenshots, links)
• File FIR at nearest police station
• Change passwords, update security settings, monitor accounts for further suspicious activity
• Follow up with bank and cyber cell; escalate to RBI ombudsman if required