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The Asia Pacific region is grappling with an unprecedented surge in identity fraud, with Sumsub’s 2024 Identity Fraud Report revealing a 121% Year-on-Year (YoY) increase, particularly in Singapore (207%), Indonesia (205%), and Thailand (201%). For the crypto and fintech industries, this data is a red flag, as both sectors have been highlighted among the top five industries experiencing the highest fraud growth rates.
Deepfakes, a particularly insidious form of fraud, have emerged as a major concern, the identity verification platform said. These AI-generated synthetic media can be used to impersonate individuals and deceive businesses into releasing sensitive information or funds. The report revealed a 194% year-on-year increase in deepfake fraud attempts in the region, which now comprise 7% of all fraud attempts in 2024. In the context of crypto and digital assets, deepfakes could be used to impersonate real people in order to gain access to their accounts or steal their funds.
The rise of Fraud-as-a-Service (FaaS) has further exacerbated the problem. FaaS platforms provide a range of tools and services to cybercriminals, making it easier for them to launch sophisticated attacks. This has led to a significant increase in account takeovers, chargebacks, and other types of fraud, Sumsub noted.
"With tactics becoming more sophisticated and fraud becoming more accessible, the need for enhanced verification measures is more urgent than ever. Robust identity protection is not just a preventive measure but a fundamental part of securing the future of digital businesses and protecting consumers in an increasingly complex landscape,” said Penny Chai, vice president of business development, APAC at Sumsub.
The report, which is based on aggregated and anonymised statistics from over 3,000,000 fraud attempts across various industries and surveyed over 200 fraud and risk professionals and 1,000 end-users, also found that the top five industries with the highest fraud growth rate in 2024 are dating (265%), online media (180%), banking & insurance (162%), fintech (156%) and edtech (144%). This suggests that fraudsters are increasingly targeting industries that are seen as being more vulnerable to attack.
So, what can be done to combat identity fraud in the crypto and digital assets industry? The report recommends that businesses implement robust identity verification measures, such as KYC (Know Your Customer) and AML (Anti-Money Laundering) checks. Businesses should also be aware of the latest fraud tactics and technologies, such as deepfakes, and take steps to mitigate the risks.
"Without a robust framework for identity verification and fraud prevention, the rise in cybercrime will continue to undermine the growth of the digital economy and erode consumer trust," Sumsub said.
Founded in 2015 and headquartered in Cyprus, Sumsub's clients include BingX, Huobi Global, Bybit, and Gate.io, among others.
