Unmasking Deepfakes: How Robust ID Validation Can Combat Financial Crime in the Digital Age

Deepfakes - A growing risk to identity verification

The rapid evolution of artificial intelligence (AI) has ushered in a new era of digital deception. At the centre of this is the rise of deepfakes—AI-generated content that can mimic a real person’s face, voice, and even their behaviour and mannerisms with alarming accuracy.

What once seemed like science fiction, and then a bit of harmless fun with spoof videos doing the rounds on social media, has become a very real and significant problem, particularly for sectors reliant on digital identity verification.

For financial services firms, as well as businesses in other regulated industries such as estate agents, law firms and gambling and betting companies, onboarding and verification are increasingly being handled online. Customers submit selfies, speak into cameras, and upload scanned documents to prove their identity. However, as AI-generated ‘deepfakes’ become more sophisticated, businesses are facing a serious dilemma: how can they be sure who—or what—they’re seeing?

How deepfakes are used in ID verification 

Criminals are increasingly using generative AI to create a range of highly sophisticated and accurate fake identification documents, imagery and live content to ‘fool’ verification and onboarding systems. These include:

• Fake documents – these fake IDs, such as passports and driving licences, as well as ‘proof of address’ documents such as bills and statements, can be indistinguishable from genuine ones
• Deepfake videos and presentation attacks – this is where a fraudster plays a convincing pre-recorded video to fool liveness checks
• Video injection attacks – a relatively new advancement, video injection attacks enable fraudsters to bypass the camera/live feed altogether and instead feed fake content directly into the business’s onboarding verification system.
  
  

As a result of increasingly sophisticated AI technology and progressively devious tactics, fraudsters are now able to bypass even the most advanced biometric safeguards, putting digital identity systems at huge risk of onboarding customers with fake and stolen identities. This exposes regulated firms to money laundering, fraud, and other financial crime and the financial, legal, reputational and moral consequences of that exposure.

Detecting deepfakes

In the past, a verification process would need to answer three main questions:

• Is the individual in question a real person?
• Is the ID a real ID?
• Does the person match the ID they are providing?
  
  

These are still the key questions that need to be asked, but with more online verification, and increasing use of deep fakes, there is also now, there is the added question:

• Is that person live and physically present?
  
  

Traditional verification can be fooled, but emerging technology is fighting back.

Innovations like passive liveness detection examine a single selfie for depth, texture, and lighting to confirm the presence of a real person.

Deepfake media analysis then evaluates pixel structure, motion, and lip sync to spot inconsistencies that give AI-generated fakes away. However, biometric analysis alone isn’t enough.

Because, while AI may be able to trick – or bypass a camera, it cannot fake consistency across multiple independent databases.

Therefore, document verification remains an absolutely essential part of a robust and accurate verification process. By cross-checking data from passports, utility records, credit databases, and other sources, regulated firms can add extra layers of security that even the most sophisticated ‘deep fake’ cannot fool. AI-enhanced IDV can detect document inconsistencies and flag suspicious patterns across multiple systems, even if a biometric spoof gets through.

The solution - robust ID verification 

As outlined above, to stay ahead of AI-driven fraud, particularly deep fakes, businesses need to take a multi-layered approach to verification. They need to be able to combine biometric technology with advanced document analysis, and real-time database checks.

SmartSearch is a pioneer in digital compliance; the team launched one of the first digital verification solutions more than 14 years ago and is constantly innovating in the digital compliance space. In response to the growing threat of deep fakes, SmartSearch is launching an enhanced version of its SmartDoc solution.

This strategic upgrade to the existing document verification solution delivers exactly the kind of robust, AI-enhanced identity validation needed to outsmart deepfakes. SmartDoc integrates multiple verification features to offer one of the most advanced solutions on the market:

• Biometric and liveness detection: Confirms a real person is present by analysing facial cues invisible to the human eye.
• Document analysis: Tamper detection and high-level analysis identify altered or fake IDs and documents.

Improved user experience

While SmartDoc is a highly advanced digital compliance solution, it has also been designed to be seamless and intuitive for end users for a streamlined onboarding process and enhanced user experience:

• Efficiency – secure, and compliant, with minimal manual intervention
• Reliability – seamless and trusted onboarding process
• Flexibility – the solution can be tailored and scaled to each business’ needs and processes

Because there is no need for potential customers to download an app, SmartDoc offers a much less intrusive customer experience compared to other digital verification systems. This helps with drop offs as well as accuracy.

Future-proofing ID verification in the age of AI

In a landscape where deepfakes are becoming the norm, the businesses that thrive will be the ones who stay ahead of the criminals.

Robust ID verification is no longer optional—it’s essential. SmartSearch’s SmartDoc solution, now enhanced with cutting-edge AI, offers a future-ready defence against even the most sophisticated financial crime.