Fraud prevention measures do not ensure that consumers will have confidence.

According to Experian, over a third of companies are leveraging AI, including generative AI, to combat fraud as threats become increasingly sophisticated. In response, businesses are ramping up their investments, with more than half adopting new analytics and developing AI models to improve customer decision-making. However, AI presents a paradox; while it enhances the speed of threat detection, it simultaneously facilitates new scams such as deepfakes and impersonation. Agentic AI, which can autonomously make decisions, increases efficiency in fraud detection and customer service but also raises the risk of advanced automated scams. As these technologies become more accessible, the potential for misuse escalates, necessitating robust safeguards and oversight from the outset. The report highlights growing concerns about AI-driven fraud, with 72% of business leaders anticipating significant issues by 2026. Despite some companies embracing AI for fraud prevention, consumer trust remains low, with fewer than one in four individuals having used AI tools like chatbots, and only 18% expressing full trust in them.

This year, businesses are feeling the strain, with 90% expressing concern about fraud and 70% planning to increase their budgets to address it. Nearly 60% of companies reported higher fraud losses compared to the previous year, with identity theft, payment fraud, account takeovers, peer-to-peer payment scams, and first-party fraud being the most prevalent types. Concurrently, 57% of consumers feel uneasy about online activities, with many doubting that companies adequately explain how their data is used. Their primary concerns include identity theft, stolen credit card information, online privacy, phishing scams, and misinformation. The Federal Trade Commission (FTC) reported that consumers lost a record $12.5 billion to fraud in 2024, marking a 25% increase from the prior year. In light of these issues, customers are raising their expectations for online safety, with over 80% expecting companies to address security and privacy concerns. While 85% of businesses believe their fraud controls meet consumer expectations, less than half of consumers express high trust in companies to effectively manage their online safety concerns.