The most dangerous types of fraud in 2025
- azakaw
- Aug 4
- 8 min read
Updated: 4 hours ago
Fraud in 2025 is a front-line issue. The combination of artificial intelligence, decentralised finance (DeFi), and compromised personal data has given rise to a wave of increasingly deceptive and high-impact fraud schemes.
These are not just affecting the vulnerable or the careless - even the most cautious individuals and businesses are being targeted.
This guide breaks down the most dangerous types of fraud currently affecting global markets, with practical strategies and tools to protect yourself and your organisation.
From AI voice scams to synthetic identity fraud, we’ll expose how these schemes operate, what red flags to watch, and what real steps you can take today to stay ahead.
Key Takeaways on Types of Fraud |
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What is fraud?
According to Black's Law Dictionary:
Fraud is any activity that relies on deception to achieve a gain. Fraud becomes a crime when it is a “knowing misrepresentation of the truth or concealment of a material fact to induce another to act to his or her detriment.
In short, if you lie to deprive a person or organization of their money or property, you’re committing fraud.
A new era of risk: from deepfakes to DeFi
2025 has ushered in a new generation of fraud that exploits both technological gaps and human psychology.
AI-powered tools now allow criminals to create highly convincing voice clones, video deepfakes, and real-time impersonations of executives, colleagues, or loved ones. These are not fringe cases - they’re increasing in volume and sophistication.
Criminal syndicates are also leveraging DeFi platforms to create unregulated, anonymous schemes that move stolen funds through automated smart contracts.
These platforms are often built on forked blockchains with no oversight or security audits.
At the same time, synthetic identities, created by merging real personal data with fake attributes, are being used to open bank accounts, secure credit, and bypass compliance checks.
In a typical case, a fraudster may use a real ID number, a fake name, and a real mobile number tied to an anonymous SIM, creating a credible profile that slips through older verification systems.
Large-scale data breaches from previous years are continuing to fuel this ecosystem. Even data from outdated social platforms or forgotten e-commerce sites is being used to engineer access to current accounts and systems.
Did you know that criminals use these networks to launder money with smurfing?
Why traditional defences no longer work
Most businesses and individuals rely on outdated defences:
Antivirus software
Static passwords
One-size-fits-all employee training is no match for attacks that are adaptive, social, and convincingly personal.
In the past year, social engineering surpassed technical vulnerabilities as the top attack vector in fraud-related incidents.
This shift means the biggest risks lie in trust, urgency, and manipulation, not just in code.
Case Study: The Times reported multiple City firms were targeted by AI-generated voice-and-video scams that persuaded employees to authorise urgent payments based on cloned voices. However, specific financial values were not disclosed.
What are the top 5 fraud types in 2025?
The top 5 types of fraud are:
AI phishing and deepfake scams
Identity theft and synthetic identity
Environmental, Social, and Governance (ESG) Investment & Crypto Pump Scams
Business Email Compromise (BEC)
BNPL & E-commerce card fraud
Type of fraud | Key risk in 2025 | Prevention tip |
AI Phishing & Deepfake Scams | Real-time impersonation of executives, staff, or family | Multi-Factor Authentication (MFA) + domain monitoring + human verification |
Identity Theft & Synthetic Identity | Fake profiles built with real data, bypassing KYC systems | Biometric login + credit freeze + ID monitoring |
Environmental, Social, and Governance (ESG) Investment & Crypto Pump Scams | Greenwashing and AI-themed schemes exploiting public trust | Verify with FCA + use ScamSmart and due diligence |
Business Email Compromise (BEC) | Vendor fraud and invoice tampering during routine workflows | Dual approval + secure supplier portals |
BNPL & E-commerce card fraud | Fake shops, cloned checkouts, Klarna/Afterpay misuse | Virtual cards + HTTPS verification + browser tools |
Phishing & AI-Enhanced Scams
In 2025, phishing is layered, multichannel, and highly customised.
AI tools generate emails in your internal tone, referencing real meetings, shared files, or executive announcements.
A common vector is LinkedIn-based spear-phishing, where a fraudster poses as a job candidate or recruiter and sends a link disguised as a CV or calendar invite.
Voice phishing has also escalated. A single 30-second clip of a person speaking, available on almost any podcast or public video, is enough to clone a voice.
Criminals use WhatsApp voice messages or quick calls to request urgent payments or logins.
Best practices:
Conduct monthly anti-phishing simulations,
Enforce password managers and domain-based message authentication,
Verify requests through an alternative channel before taking action.
Identity Theft & Account Takeover
In 2025, identity theft is often silent until it’s too late.
Victims only discover this type of fraud after a credit denial, a tax issue, or strange packages.
The UK, for instance, saw a 41% year-on-year increase in synthetic identity fraud in Q1 2025 alone.
Much of this stems from breaches of health data, educational institutions, and government portals. In some cases, minors’ data is used because they have clean credit histories, making it a long-term weapon for fraudsters.
Action steps:
Set fraud alerts and freeze your credit if you’re not applying for loans,
Use biometric logins and passkeys,
Check your national insurance contributions and HMRC records regularly.
Investment Scams with fake ESG promises
Investment scams have gone premium. You’re not pitched penny stocks; you’re invited to exclusive panels, fake fintech launches, or ESG fund openings.
These scams frequently feature:
Fabricated ESG ratings,
Whitepapers generated by AI,
Vanity domain names impersonating regulatory bodies.
Some even employ fake “independent” review platforms populated with AI-generated testimonials.
Here are some due diligence tools you can use to try to avoid these scams:
Whois + Companies House for company details.
Read also:
Business Email Compromise (BEC) & Vendor Fraud
This is one of the most common types of business fraud.
BEC attacks are now some of the costliest forms of corporate fraud. These are long-game attacks.
Hackers sit in your system for weeks, studying invoice cycles, supplier habits, and even holiday calendars to strike at the moment of least resistance.
A new BEC trend is Business Text Compromise (BTC) via WhatsApp or SMS. Fraudsters clone a known number, pose as a contractor, and request immediate payment or credentials.
Here’s a BEC prevention checklist:
Implement payment confirmation protocols.
Store vendor data securely and limit internal access.
Review audit logs for anomalies.
Credit Card and BNPL (Buy Now, Pay Later) Fraud
Buy Now, Pay Later services like Klarna, Zilch, and Clearpay have made checkout easier - for both consumers and fraudsters.
One 2025 study found over 100 thousand fake e-commerce sites, many with cloned Klarna widgets and spoofed checkout pages.
Overlay attacks also remain widespread. In this type of fraud, a fraudster creates a browser layer that captures everything typed into a form, even if the site is legitimate.
Here are some recommended defences:
Only shop via apps or verified mobile sites,
Use disposable virtual cards or masked email logins,
Enable real-time notifications on all payments.
How to protect yourself and your business
Protecting yourself in a high-risk digital world demands action.
While no single tool can prevent every fraud attempt, the right mix of technologies and habits can drastically reduce your exposure.
Must-have tools & safeguards
For individuals:
Experian Protect or Equifax ID Watch,
Browser: Brave with uBlock Origin,
Antivirus with fraud-specific alerts: Norton 360, Avast One
For businesses:
Email security: Abnormal Security, Proofpoint,
KYC: azakaw, ComplyAdvantage, Alloy, etc
Behavioural analytics: Sift, BioCatch,
Data loss prevention: Microsoft Purview, Digital Guardian.
You might be interested in: How to prevent financial crime
Behavioural red flags across different types of fraud
Fraudsters rely on behaviour, not just tech. The most common manipulation tactics in 2025 are:
Authority bias: “I’m calling from your CEO’s office”;
Scarcity pressure: “We only have 30 minutes to confirm this rate”;
Familiarity illusion: “As discussed in last week’s email…”.
To avoid being manipulated and ultimately a victim of fraud, train your staff and household to always confirm identity via two separate channels, use code words for financial instructions, and keep logs of sensitive interactions.
Related content: The best KYC & AML certifications
Report, Respond, Recover
A fast and well-coordinated response to fraud is critical, no matter where you are. Here's how to take action:
Step-by-step response checklist
Secure all devices and update passwords immediately,
Notify your bank and freeze affected accounts.
File a police report and keep all related documentation.
Monitor your credit for at least six months.
Report the fraud to the relevant local or national authorities.
Reporting resources by region
Country/Region | Entities |
United Arab Emirates | |
European Union | - European Consumer Centres Network (ECC-Net) - National cybercrime units (e.g., CERT-EU, France’s ANSSI, Germany’s BSI) |
United Kingdom | |
United States | |
India |
Wherever you are, report fraud promptly and document every step.
The sooner you act, the more likely you are to prevent further loss and support law enforcement investigations.
FAQs
Can AI scams mimic someone I know?
Yes. AI tools can now recreate realistic voices and deepfakes in under 30 seconds of sample data.
Is Klarna safe to use in 2025?
Yes, but only on verified websites and never through suspicious links. Stick to the app for maximum protection.
How can I know an investment is legitimate?
Always verify the company on the FCA register, and never trust unsolicited offers or pressure tactics.
What’s the first thing to do if I suspect identity theft?
Freeze your credit, report to Action Fraud, and change logins immediately.
Can children’s data be used in fraud?
Yes. Fraudsters increasingly use minors’ data for synthetic identity fraud, especially in countries with centralised healthcare or education systems.
What is “overlay fraud”, and how can I avoid it?
Overlay fraud happens when a fake browser layer mimics a legitimate site to steal your data. To prevent it, use trusted apps, privacy-focused browsers, and virtual cards.
Is WhatsApp safe for business communication?
Not for sensitive transactions. Fraudsters now clone contacts via WhatsApp and SMS. Always confirm financial or personal requests through a secondary, trusted channel.
How often should I check my credit reports?
At least quarterly. If you’ve been a victim of fraud or data breaches, you should check them monthly. Many services offer real-time alerts.
Can I rely on antivirus software alone?
No. Antivirus is just one layer. Fraud prevention today also requires behavioural analysis, identity monitoring, and employee training.
What’s the biggest fraud trend to watch in 2026?
Hyper-personalised scams using AI and real-time data leaks. Expect more fraudsters to exploit social media connections, niche communities, and real-time messaging platforms.
Staying ahead of these types of fraud
Fraud in 2025 is more sophisticated, personalised, and widespread than ever before, fuelled by AI, data leaks, and unregulated platforms like DeFi.
From deepfake scams to synthetic identities and fake ESG investments, no individual or business is immune.
The key to protection lies in awareness, layered defences, and proactive habits.
Relying solely on antivirus software or passwords is no longer enough. Instead, combine behavioural training, biometric verification, multi-factor authentication (MFA), and fraud monitoring tools.
Whether you're protecting personal finances or leading a compliance team, staying informed about the latest fraud types and prevention strategies is critical to reducing your risk.
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