Topic starter
12/07/2026 12:26 pm
TL;DR: AI-assisted scams and overseas fraud hubs helped push crypto-linked losses to at least $14 billion in 2025, according to Chainalysis. Identity proofing and authorisation checks now need to carry more of the load before funds leave an account.
Editorial analysis by NHI Mgmt Group, based on content published by Chainalysis: “Why Now is the Time for the UK to Lead the Global Fight against Crypto-enabled Fraud”.
By the numbers:
- At least $14 billion in cryptocurrency was transferred to addresses associated with scams and fraud in 2025.
Key questions
Q: Why do AI scams increase fraud risk for identity and trust programs?
A: AI raises fraud risk because it makes deception cheaper, faster, and more convincing.
Q: What signals show that transaction monitoring is missing fraud networks?
A: A common signal is repeated reuse of the same wallet addresses, mule accounts, or scam-linked infrastructure across many cases.
Q: What breaks when payment fraud controls rely only on the transaction itself?
A: Controls fail when they treat the payment as isolated from the actor behind it.
Practitioner guidance
- Strengthen identity proofing before payment approval Require higher-assurance checks for new beneficiaries, account changes, and first-time transfers where fraud risk is elevated.
- Correlate wallet and account intelligence in monitoring Feed scam-linked addresses, mule indicators, and behavioural signals into transaction monitoring so recurring fraud patterns are recognised early.
- Move controls to the authorisation boundary Apply risk scoring and step-up review before funds leave the customer account, especially for instant payments and crypto transfers.
Bottom line: Fraud now exploits weaknesses in identity confidence and transaction approval, so the attack surface extends well beyond traditional case investigation.
Glossary terms: Authorisation-Time Risk Scoring, Fraud Network Detection, Identity Confidence, Mule Account
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This topic was modified 9 hours ago by NHI Mgmt Group
12/07/2026 12:40 pm
Fraud is now an identity security problem, not only a payments problem. The article shows that scams succeed when identity confidence is weakened at the point of trust, whether through impersonation, synthetic personas, or manipulated approval flows. That means fraud governance has to sit alongside IAM, verification, and transaction controls rather than being isolated in a back-office fraud queue. Practitioners should treat identity assurance as a fraud-prevention control surface.
A few things that frame the scale:
- Nearly 60% of companies reported that fraud losses were still increasing in 2025.
A question worth separating out:
Q: How should firms balance fraud prevention duties across banks, crypto businesses, and platforms?
A: They should treat fraud prevention as a shared accountability problem that spans onboarding, authorisation, reporting, and cross-border disruption. The practical standard is that each firm owns the control points it can see, but no single institution can solve transnational fraud alone. That is why coordination, data-sharing, and escalation paths matter as much as detection tooling.
👉 Read our full editorial: Fraud is becoming an identity and transaction security problem