2025 Fraud predictions: Industry innovators share bold forecasts for the future of fraud and identity

As we approach 2025, fraud threats continue to evolve, challenging businesses and individuals to stay one step ahead. To uncover the trends shaping the next year, we asked ten industry leaders to share their boldest predictions for identity and fraud. Each expert offers a distinct and powerful perspective on emerging threats and strategies, from advances in AI-powered detection to synthetic identities, check fraud, deepfakes, and privacy regulations.

These insights are purposeful and disruptive, cutting through the noise, spotlighting specific, actionable predictions that inspire fresh approaches to digital trust and security. As fraud tactics grow more sophisticated, understanding the road ahead is essential for staying resilient.

We hope this powerful lineup of predictions from fraud experts will spark new approaches to fraud prevention, inspire conversation in your professional communities, and help businesses bolster their defenses. As you explore each perspective, consider how these insights can shape your organization's approach to identity and fraud protection in 2025 and beyond.

What 2024 numbers reveal: a warning for the year ahead

Before we look ahead, let's take a quick look back at some 2024 red-flag statistics.

According to recent estimates, global losses from digital fraud reached over $47.8 billion this year, reflecting a significant 15% increase, and highlighting the growing sophistication of online scams​. Synthetic identity fraud alone surged by 31% as fraudsters increasingly exploited AI to create more sophisticated fake identities, making it one of the fastest-growing fraud types in recent years. Additionally, check fraud incidents climbed by 28%, largely due to the increased use of deepfake and phishing scams that targeted both businesses and individuals, according to the U.S. Federal Trade Commission.

These staggering figures underscore the urgency of adapting to a new fraud landscape as we enter 2025, where emerging threats demand equally innovative defenses.

Predictions you might not expect for 2025

1. Advanced fraud mitigation will transform identity verification while bolstering user experience

Gerald van Veldhuijsen- Lead Product Owner Digital Identity & Onboarding at ABN AMRO

In the coming year, I foresee a surge in advanced fraud mitigation techniques integrated into identity verification (ID&V) technologies. These advancements will be driven by increasingly sophisticated fraud attempts, regulatory demands, and the growing need to safeguard sensitive data. While some of these measures will seamlessly operate in the background, others may introduce noticeable friction for end-users.

Balancing robust security with a smooth user experience will be the key challenge. Success will depend on leveraging emerging technologies like AI and behavioral analytics to enhance accuracy and minimize disruptions, while continuously iterating on solutions to address evolving threats without alienating users.

2. Holistic systems will solve problems across the identity lifecycle

Frances ZELAZNY - CO-FOUNDER & CEO at ANONYBIT

Now that privacy-enhancing technologies are maturing and are better understood, they will become table stakes in the evolution and adoption of biometric identity systems. Driven by concerns around deepfakes, account takeover fraud, and operational inefficiencies in managing identity today, enterprises will think about how to establish more holistic systems that can solve for problems across the identity lifecycle, even as they adopt verifiable credentials, digital IDs, and Passkeys. The focus will shift to interoperability and collaboration between technology providers to build ecosystems that balance security, convenience, and privacy. As fraudsters continue to adapt, proactive strategies incorporating real-time intelligence and advanced AI will be critical to maintaining trust in digital networks.

3. Weaponized trust will double AI-powered impersonation attacks, redefining digital identity risks

Tyson Goings - Head of FinTech Strategy at Verizon

The year 2025 is poised to be a tipping point in the battle for digital identity and the use of next generation AI against victims. While the internet has always been a playground for deceit, the emergence of advanced deep learning technologies is handing malicious actors a potent new armament: weaponized trust.

ChatGPT captivated the world with its ability to generate human-like text just two short years ago. Now, bad actors are now using its malicious counterparts and learning to mimic voices, faces, and writing styles with impressive accuracy. This allows criminals to craft highly targeted attacks, exploiting the inherent trust we place in familiarity.

No longer confined to mass phishing and smishing campaigns, fraudsters are adopting the precision tools of personalized persuasion, such as mimicking a loved one pleading for urgent financial help or impersonating service providers such as bank representatives to obtain sensitive account information. This is the reality that deepfakes and AI-powered impersonation are enabling and 2025 will see a doubling or more of these types of attacks from 2024.

4. mDLs will be an integral part of the digital transformation sweeping across government services

Riley Hughes- CO-FOUNDER & CEO at TRINSIC

In two years, the way Americans prove their identity will be unrecognizable. By the end of 2026, 100 million people could have a mobile driver's license (mDL) on their phone, allowing them to prove their identity instantly. 75% of Americans live in states where mDLs are underway. Early adopters in states like Louisiana and Colorado paved the way, demonstrating the viability and appeal of digital IDs for both in-person and remote scenarios. Now, with powerhouse states like California, New York, and Virginia recently launching mDLs, adoption is accelerating rapidly.

My estimate of 80 to 100 million users with an mDL by 2026 is based on simply extrapolating historical adoption rates from early adopter states. This market shift warrants a fundamentally new paradigm of digitally-native identity verification. Millions of Americans already have mobile driver's licenses, but increased adoption will open up new scenarios for identity verification that weren't feasible with physical ID document verification.

For most people, their physical ID card is the only thread tethering people to a leather wallet in their pocket. Mobile IDs cut the cord, ushering in an era of privacy-enhancing, consumer-controlled, digital ID verification.

5. AI-driven fraud will reshape authentication and usher in the era of digital IDs

Adam Johnson - Lab Product Manager / Product Director at Lloyds Banking Group

Online fraud is on the rise, with eCommerce platforms increasingly under attack. This surge is fueled by rapid technological advancements, particularly in AI. Impersonation fraud, powered by AI and deepfakes, now accounts for 82% of fraud attempts, making it more sophisticated and harder to detect. To combat this, prevention strategies must evolve, moving beyond traditional authentication methods to embrace verified authentication as the new standard. This shift ensures that the person being authenticated is truly who they claim to be. Digital IDs and digital ID wallets will begin to complement existing processes, eventually transforming the way we approach authentication in a rapidly changing digital landscape.

Download the new Digital Identity Fraud Playbook for more on the future of fraud

6. Hesitation to embrace AI will leave financial institutions vulnerable to deepfake-driven scams

Ravi Nemalikanti- Chief Product & Technology Officer at Abrigo

In 2025, the use of deepfake technology to power scams will push financial institutions to adopt advanced AI defenses. Fraudsters will craft hyper-realistic texts and mimic trusted voices, tricking victims into authorizing payments through smishing and other social engineering scams. Traditional tools can't keep up. Despite this, only 30% of institutions use AI-driven fraud prevention, and nearly half remain undecided, according to an Abrigo webinar poll. Hesitation is an existential threat or at a minimum, very costly. Banks and credit unions must embrace AI solutions and invest in oversight and skilled teams to stay ahead. As the use of AI for fraud evolves, so must defenses. The future of fraud prevention is already here, and action is critical.

7. Deepfakes and data breaches will redefine account takeover threats, pushing security to evolve

ROBIN PUGH - CO-FOUNDER & CEO at DARKTOWER

By 2025, the combination of easily accessible data breach information and rapid advancements in deepfake technology will elevate account takeovers to unprecedented levels. Threat actors will increasingly exploit leaked personal data to bypass traditional security measures, while deepfakes-becoming more convincing and affordable-will enable the manipulation of voice and video authentication methods. This perfect storm will push organizations to adopt more sophisticated identity verification technologies, such as advanced biometric analysis, AI-driven anomaly detection, and multi-layered authentication strategies. The industry will need to prioritize adaptability and vigilance, as static security protocols will no longer suffice in combating this evolving threat landscape.

8. AI will keep the good guys ahead-unless they fail to adapt

Cam Stirner - Manager intelligence & analysis at DARKTOWER

While threat actors are going to run wild with AI and new generative technology on fraud types like account takeovers, the ball will remain largely in the court of the threat disrupters. It is absolutely true, and rather startling that the phish campaign creators of the past can now hurdle over any language barriers that previously hindered them and today's romance scammers can create deepfakes so real that most of the population cannot tell fact from fiction. However, while there are certainly more bad guys then there are good guys, both the potential of this technology and the onus to use it in new combative ways will largely fall upon those who investigate and disrupt these scams.

It is easy to fear-monger and say that every scam and threat actor are going to become infinitely more effective with the assistance of AI, but it;s important to remember that the good guys are still the ones with the most access to AI tools and opportunities, and have skillsets that far exceed the vast majority of street level theta actors.
To this point though - should this prediction fail to come true, and somehow the world's financial institutions, governments and threat investigators do not utilize emerging technology in properly combative ways, threat actors may gain a true upper hand in ways we've never really seen before on issues like pig butchering and account takeovers

9. New regulations will force firms to revolutionize fraud prevention strategies

Raymond Wilson- Financial Crime Expert & Accredited Trainer at AMLGS

In 2025, large UK and European companies will face a seismic shift in fraud prevention expectations as the Economic Crime and Corporate Transparency Act 2023 and the Payment Services (Amendment) Regulations 2024 redefine compliance standards. The new 'Failure to Prevent Fraud' offense will heighten scrutiny, requiring organizations to demonstrate effective anti-fraud measures for customers, employees, and partners. Coupled with the EU's mandate allowing PSPs to delay suspicious payments by up to 72 hours, compliance teams will face pressure to adopt advanced identity verification tools, AI-driven risk assessment, and real-time fraud monitoring. These changes will push fraud compliance from a reactive to a proactive approach, embedding it within AML functions and overall strategy as a key element of competitive advantage. Several firms are already prioritizing this shift, and it's poised to reshape the business landscape.

10. Fraud will blur realities, scramble identities, and demand greater accountability

Chris Briggs - Chief product officer at mitek

Fraud will become weirder and scarier, blurring the lines between fake and real even more than they are today, while also fueling the spread of disinformation. Social engineering will continue merging with genuine fraud to grow even more complicated, creating schemes that are harder to detect, predict, and prevent, ultimately creating an even larger susceptible class of citizenry.

As these challenges escalate, organizations will come to terms with the reality that they cannot catch every instance of fraud. However, heightened regulatory scrutiny will push those who uncover fraud to report it more consistently, shifting the focus from complete prevention to proactive accountability.

11. Synthetic identity fraud will unleash widespread chaos

John FICK - Corporate Vice President, Head of Fraud at northwest bank

Financial crimes continue to rise year after year, with technology enabling bad actors to perpetrate increasingly sophisticated schemes against individuals, businesses, and communities. These criminals are relentless and constantly adapt their tactics to exploit vulnerabilities for personal gain, whether by stealing wealth or identities. In 2025, identity theft will surge further, fueled by the countless data breaches across the United States and ineffective privacy and identity protection laws. Synthetic identity fraud, one of the fastest-growing fraud vectors, has been quietly proliferating, waiting for the right moment to strike. With the advent of easily accessible generative AI tools, bad actors are now able to commit deepfakes, spoofing, and digital injection attacks with unprecedented speed and scale.

The impact of AI extends beyond identity theft, infiltrating areas such as check fraud. Generative AI can analyze genuine check samples and produce countless counterfeits in a matter of minutes, which can then be printed using standard home printers. Gone are the days when synthetic identities were primarily pollinating through credit cards or loans. Today, they are being paired with tangible monetary instruments like counterfeit checks tailored to match the fake identity. As this trend grows, fraudsters are poised to unleash widespread disruptions, exacerbating challenges in an already volatile economy.

12. Biometrics will transform fraud prevention and redefine financial security

Kerry Cantley - VP, Digital Banking Strategy at MITEK

Fraud scams, deepfakes, and fraud attacks will continue to affect consumers worldwide, fueled by the accessibility of advanced technology. In response, biometrics are becoming essential in combating fraud. Growing consumer comfort with tools like fingerprint scans, facial recognition, and voice authentication is driving a shift in the financial sector. Banks increasingly view biometrics as a critical component of identity and fraud protection strategies, particularly in payment and financial transactions.

Advancements in generative AI enhance biometric capabilities while helping protect against fraudsters who also exploit cutting-edge tools. Beyond convenience, biometrics address compliance and fraud prevention, aligning with regulatory focuses on payment risks, KYC, and anti-money laundering. Biometric step-up authentication is proving invaluable for confirming identities, preventing fraud, and meeting regulatory demands.

As consumer trust in biometrics grows, financial institutions are likely to adopt this technology to enhance security, ensure compliance, and improve customer experiences.

13. The rise of orchestrated insider check fraud will hit banking's blind side

FRANK MCKENNA- Chief Fraud Strategist & Co-Founder at point predictive + Frank On FRAUD

As mail theft and check fraud have soared, tellers and branch banking associates have been thrust into the front lines in the fight against fraud. They are often the bank's first and last line of defense before the money is extracted from accounts. But that has also made them ripe targets for criminals, who want their help ensuring the checks get paid.

In 2025, criminal rings will significantly increase their recruiting of banking associates on social media, Telegram, and the streets. Whether they are paying the associates to pass them stolen account information or using them to help them cash fraudulent checks, we will see a significant increase in insider-orchestrated fraud schemes.

Banks should initiate training and awareness around internal fraud recruiting schemes, monitor for internal collusion and work with law enforcement when associate involvement is detected.

Anticipating tomorrow's fraud challenges today

The path forward may be complex, but with insights from these experts, organizations can confidently navigate the challenges of 2025 and beyond. Explore these predictions to stay informed, prepared, and resilient against tomorrow's evolving fraud risks.

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