New Report From Experian Reveals Surge in AI-driven Fraud

2 July 2025

Experian AI Fraud Report – Digital Risk Insights

New insights from Experian reveal over a third (35%) of UK businesses reported being targeted by AI-related fraud in the first quarter of 2025, compared to just 23% last year. The sharp rise is being driven by the use of deepfakes, identity theft, voice cloning, and synthetic identities - techniques that are rapidly gaining traction amongst fraudsters. Interestingly, the most commonly reported fraud encountered by UK businesses were APP fraud, money mules, and scams (47%), followed by transactional payment fraud (38%), identity theft (34%), account takeover (33%), and first-party fraud (33%). In addition, the most affected sectors were digital-only retailers with (62%) targeted in Q1, followed by retail banks (48%) and telecom providers (44%). One new threat that has emerged in this latest report is SIM swap fraud. This saw a dramatic increase in 2024, rising by over 1,000% year-on-year, with nearly 3,000 cases logged on the National Fraud Database. While this is a broader industry trend, our findings highlight how this technique allows criminals to hijack a victim’s mobile number and intercept SMS-based two-factor authentication (2FA) codes, enabling them to access bank accounts, steal wages, or apply for loans. However, businesses are stepping up their defences with (68%) confirming they will increase fraud budgets in 2025. In addition, the focus will be combatting AI fraud with AI technology More than half (52%) of UK businesses are set to improve AI analytics in 2025, while (51%) are building new models to improve customer decisioning and reduce false positives. Businesses are also strategically aligning their investments and budgets to address the most prevalent threats and most pressing challenges in the industry

60% are prioritising improving the detection and prevention capabilities for first-party fraud.
58% are focused on tackling the growing risk of synthetic identity fraud.
56% are directing efforts toward mitigating Authorised Push Payment (APP) fraud

Notably, a clear trend is also emerging with businesses looking to bring fraud and compliance teams closer together to combat the increase in fraud and financial crime. Six in ten (60%) of businesses are now merging fraud and AML functions into unified FRAML operations, and 65% are investing in onboarding-stage fraud detection to identify risks earlier and improve compliance outcomes. Paul Weathersby, Chief Product Officer, Identity & Fraud at Experian UK&I, said: “AI is changing the way fraud is committed, and it’s happening fast. Criminals are using tools like deepfakes and voice cloning to trick both people and systems, and we’re seeing the impact across multiple sectors. But AI also gives us the opportunity to strengthen our defences. Businesses that act now, by investing in layered security, biometric checks, and smarter fraud detection will be in a much stronger position to protect their customers and stay ahead of the threat.”

Companies in this story: Experian

People in this story: Paul Weathersby