By ANNELIA NIXON

Tribune Business Reporter

anixon@tribunemedia.net

A Bahamian payments provider yesterday urged businesses to be alert for ‘deep fakes’ plus synthetic identity fraud and the takeover of their bank accounts.

Suggesting that so-called ‘deep fakes’ will be an increasing problem for Bahamians, Khalil Braithwaite co-founder and director of Kanoo Pays, said synthetic identities, account takeover and friendly fraud are current dangers facing consumers and businesses.

“Friendly fraud is just pretty much chargebacks where people kind of take advantage of the system. They pay for something, say it’s something they didn’t pay for it, and so the banks get caught in limbo,” Mr Braithwaite said.

“And so friendly fraud is someone just taking advantage of the system and chargebacks. Synthetic identities are where people take bits of fictitious information, blend it with real information, and create literally an identity that could pass and interact, and has all of the paperwork.

“And then account takeover is where people pretty much falsify their presence, or somehow gain access to someone’s account under some false premise. So send the the pin and then they start taking the account over and sending money in nefarious ways, either little bit by little bit, or taking it out,” he added.

“But those are the three kinds of fraud - friendly fraud, where they take advantage of chargebacks; synthetic identities, where people create a fake identity to apply for something and then disappear; and an account takeover, where they pose to someone to gain access to the account and then take it over for their own gains.”

Mr Braithwaite, concerned about the potential for deep fakes, stressed the importance of keeping pace with the trends in deep fake technology.

“As a global player in the financial markets and financial services markets, it’s going to come on our doorstep at some point. And even though we think deep fakes won’t apply to us, it will be the very moment we are blindsided by its abilities,” he warned.

“And The Bahamas just needs to be aware of deep fakes and moving to high alert in short order, whereas right now, the high alert is more or less on synthetic identities, account takeover and friendly fraud. Those are the high alerts right now, but deep fake is on its way and coming through.”

Financial service providers, according to Mr Braithwaite, will likely have the investment capital to invest in deep fake screening technology. However, he does not believe The Bahamas as it is now can handle deep fakes, especially when used in a harmful manner.

“So I think those service providers, once they get scared, they will be able to do it,” Mr Braithwaite said. “It’s where the social engineering and the social scams come into play with deep fakes. At the rate of development of AI, it’s scary, but I think The Bahamas is as vulnerable as any other territory to deep fakes.

“A lot of people don’t believe that it can happen with them, but the quality of AI imagery is improving every second. I don’t think we’re fully ready for it. I think we’re aware that it’s out there, but it’s kind of like, ‘oh, that wouldn’t happen here’, which means it’s the very reason it could happen here.

“But, you know, I think people underestimate deep fakes as they are still thinking of the outdated quality deep fake videos that are there. The rate of deep fake videos are seriously impressive, and it has to be respected as a threat and at least acknowledged, not disregarded. The human side of you that thinks to identify a deep fake is the same human side that would be gullible to a deep fake.”

Online attacks are on the rise with the use of AI, but Mr Braithwaite said many “sophisticated“ attacks have been met with “even more sophisticated defence systems”. He added that product-based businesses may not feel a huge impact from AI used harmfully, but financial services leaves businesses open to synthetic identity takeover and friendly fraud account takeover.

“So The Bahamas is exposed several ways, in particular in social scams,” he said. “We’re going to see a rise in that as everybody has a phone and everyone’s in this desperate need. I think we’re going to see the same rise as any other territory that sees a lot of activity, and we will see an increase in the amount of social scams. That’s without a doubt with the ability of AI. But I think The Bahamas is positioned to to counter it.”