Proof Releases “The Trust Ledger,” Exposing the Growing Threat of AI-Driven Identity Fraud
In a groundbreaking report titled “The Trust Ledger: Transaction & Identity Fraud Bulletin,” Proof, a leader in identity authorization technology, sheds light on the alarming rise of identity fraud in the post-AI digital economy. The report provides a detailed analysis of how generative AI, synthetic identities, and stolen credentials are fueling a rapidly escalating fraud epidemic—one that is outpacing traditional defense mechanisms. Drawing on proprietary platform data, threat intelligence research, and insights from fraud leaders across industries, the bulletin paints a stark picture of the new fraud economy and its far-reaching implications.
According to FBI statistics, internet crime losses reached a staggering $16 billion in 2024, marking a 33% year-over-year increase. However, Proof’s findings suggest that the actual scale of fraud may be even larger, as attacks become more sophisticated, targeted, and difficult to detect. “Fraud today doesn’t look like it did five years ago. It’s synthetic, it’s autonomous, and it’s scaling,” said Pat Kinsel, CEO of Proof. “We’re seeing high-risk interactions involving billions in assets—across industries that never considered themselves fraud targets before. Trust must now be engineered. In a world where identity can be convincingly faked and monetized at scale, businesses, consumers, and policymakers must urgently adapt.”
The New Fraud Economy
One of the most concerning trends highlighted in the report is the emergence of synthetic identities. These fraudulent personas are created by blending real and fake information, often using AI-generated documents and matching selfies to bypass traditional Know Your Customer (KYC) checks. Fraudsters are also exploiting legitimate tools, such as access to platforms like TLOxp, which were originally designed for law enforcement and financial institutions. This abuse of trusted systems has made it easier for bad actors to operate undetected.
The report reveals that stolen identity “fullz”—comprehensive packages of personal information, including Social Security numbers, addresses, and credit card details—are being sold for as little as $3 on the dark web. Infostealer malware and commercial credential marketplaces have created a robust data supply chain, empowering large-scale fraud-as-a-service operators. Meanwhile, generative AI tools like FraudGPT and WormGPT are explicitly marketed for use in phishing, malware creation, and social engineering campaigns. Subscription prices for these tools start at just $200 per month, making advanced fraud techniques accessible to a wider range of criminals.
Who’s Impacted?
While fraud impacts individuals and organizations across all demographics, certain groups are particularly vulnerable. Proof’s data shows that older adults, aged 60–64, are both the most targeted and the most proactive in protecting themselves from identity fraud. Interestingly, the report notes that nearly twice as many identity verification users fall into this age bracket compared to those aged 20–24.
Fraud is no longer confined to payment systems; it is spreading to broader operational areas. Property managers, HR teams, and utility companies are reporting a significant spike in identity-based fraud. For example, scammers are increasingly impersonating tenants, job applicants, or service providers to exploit vulnerabilities in less secure systems. This shift underscores the need for organizations to adopt comprehensive fraud prevention strategies that address risks beyond traditional financial transactions.
Challenges in Detection and Prevention
Despite growing awareness of the fraud epidemic, many organizations remain ill-equipped to combat it. Proof’s survey of fraud leaders and enterprise customers revealed that nearly 30% of respondents lack reliable metrics for tracking or quantifying fraud across their systems. The majority reported an increase in fraud attempts, with AI-generated forgeries, document tampering, and impersonation emerging as some of the most common tactics.
“The threat landscape has changed,” said John Heasman, Chief Information Security Officer at Proof. “We’re not just seeing more fraud—we’re seeing a different kind of fraud. AI tools are making it easier to fake documents, mimic voices, and defeat legacy systems. We need to modernize our defenses around real-time detection, high-assurance identity, and smarter fraud signals.”
A Call for Modern Solutions
To address the rise in AI-powered fraud, the report outlines a modern policy framework aimed at strengthening fraud prevention efforts, particularly in high-risk industries like finance, healthcare, and energy. Key recommendations include streamlining access to advanced technologies, redesigning KYC processes to account for synthetic identities, and fostering collaboration between businesses, regulators, and cybersecurity experts.
Proof’s AI-powered Defend product is already leading the charge in this effort. The platform processes millions of high-risk transactions every month, detecting deepfakes, synthetic identities, and credential tampering in real time using over 100 distinct risk signals. By leveraging machine learning and behavioral analytics, Proof is helping organizations stay one step ahead of fraudsters.
About Proof
Proof is the trusted platform for securing the digital economy. As critical commerce shifts online, Proof empowers companies to verify who is behind every digital interaction. From pioneering online notarization to launching a comprehensive identity authorization network, Proof secures transactions with industry-leading compliance and fraud prevention. Trusted by more than 7,000 organizations across financial services, government, real estate, and healthcare, Proof is defining trust in digital transactions. Proof is backed by leading investors including TrueBridge, Wells Fargo, Citi Ventures, and State Farm Ventures. For more information, visit www.proof.com.
