In brief
- Deepfake technology has evolved beyond niche internet use to become a prevalent tool for sophisticated fraud.
- Criminals are leveraging artificial intelligence to convincingly replicate voices and images, deceiving businesses into transferring substantial sums of money or divulging sensitive data.
- Effective defences involve rigorous employee awareness, robust verification protocols, and swift legal remedies - particularly when large sums or crucial corporate reputations are on the line. Injunctive relief can be an effective remedy to stop fraudsters and recover assets.
- For additional strategic insights, including broader corporate governance considerations, see our For the Attention of the Board report here.
Deepfake technology is no longer a fringe phenomenon; it is fast becoming a serious threat, with fraudsters using it to dupe businesses and individuals out of large sums of money or valuable information. By leveraging artificial intelligence, criminals can fabricate audio and video content that appears strikingly authentic, leaving even the most perceptive employees and stakeholders vulnerable. We are encountering the fallout from deepfake scams more frequently, highlighting the urgent need for comprehensive preventative measures and robust legal strategies.
High-profile cases
Real-world examples demonstrate the sheer audacity of deepfake fraud. In one instance, a British engineering firm, Arup, fell victim to a sophisticated deepfake scam in which an employee was deceived into transferring $25 million after participating in a video call with AI-generated deepfakes of the company's CFO and other staff members. The realistic visuals and audio convinced the employee of the request's legitimacy, leading to multiple transactions to fraudulent accounts. On a personal level, deepfake "face-swap" videos have been used for extortion, with criminals threatening to leak false but highly compromising footage unless they receive payment.
Three key defences
- Verification protocols: Businesses should adopt secondary "two-factor" authentication, whether through separate email confirmation or a follow-up call to a verified number, particularly before approving high-value transfers. This ensures that a single phone call or video is never enough to trigger action.
- Employee awareness: Instituting effective training to spot unusual pauses, distorted audio, or suspicious visual details in calls and videos is crucial. Continuous education helps staff remain vigilant against AI-generated ploys.
- Detection tools: Although AI evolves rapidly, software solutions that analyse media for anomalies, including uncanny facial movements or unusual sound waves, can provide vital early alerts. Transaction history can also help spot unusual payment amounts and recipient details.
Injunctive relief and beyond
When a deepfake has been released, or there is evidence of impending fraud, prompt legal action can be pivotal. It may be possible to obtain a non-disclosure injunction to force the removal or prevention of malicious content online, thereby limiting reputational harm. However, in many cases, financial losses can mount quickly, prompting the need for freezing injunctions to protect or recover stolen funds. Such court orders restrict perpetrators’ ability to transfer their ill-gotten gains, making it considerably easier to reclaim assets if litigation follows.
Additionally, tools like Norwich Pharmacal orders can compel third parties – including banks or online platforms – to disclose relevant information that reveals the identity of the fraudsters or the trail of funds. This combination of targeted injunctions and forensic asset tracing forms a powerful strategy to mitigate the damage of deepfake fraud, holding scammers accountable and safeguarding victim organisations.
Building a resilient approach
While deepfake technology presents formidable challenges, it isn’t unbeatable. By strengthening authentication processes, conducting regular staff training, and harnessing advanced detection technologies, organisations can create a multi-layered defence. Should a deepfake fraud occur, swift legal action – including freezing injunctions, Norwich Pharmacal orders, and other injunctions – can help bring criminals into sight, prevent further damage and recover stolen assets.
At Mishcon de Reya, our Civil Fraud team is committed to helping clients mitigate deepfake-related risks. Through a blend of proactive technical measures and immediate legal recourse, we stand ready to protect your interests in this ever more treacherous digital battlefield.