New York Attorney General Letitia James has issued a warning about sophisticated investment scams involving deepfake technology and celebrity endorsements.

According to Newsweek, the alert highlights the use of AI to manipulate videos of celebrities like Warren Buffett and Elon Musk to promote fraudulent schemes.

Attorney General James raised concerns over an increasing number of investment scams that utilize artificial intelligence to create convincing but fraudulent endorsements by high-profile figures. These deepfakes are being disseminated across various social media platforms to deceive investors.

Deepfake Technology in Social Media Scams

These scams have specifically appeared on social media feeds, digital advertisements, and personal messaging apps. Scammers have used platforms such as X (formerly Twitter) and Facebook to spread deceptive promotions.

One reported instance on X featured a deepfake video of Warren Buffett advocating for a "Bitcoin giveaway," which directed viewers to a fraudulent website. Another video on Facebook showed Elon Musk allegedly promoting a Bitcoin doubling scheme, complete with a now-removed QR code designed to lure unsuspecting investors into sending digital currency.

Transition to Encrypted Messaging for Scamming

After initial contact on public platforms, scammers often shift to private messaging apps with end-to-end encryption, like WhatsApp or Telegram. The scammer then engages further with the victim, providing detailed fraudulent instructions.

Luis Corrons, a Norton Security researcher, emphasized the shift to encrypted messaging, noting, "Once victims engage in the scam, they are asked to move to other platforms with end-to-end encryption, where they'll receive further instructions."

These encrypted platforms, while providing privacy for legitimate users, also shield scammers, making it difficult for law enforcement to trace and intercept criminal activities. Corrons explained, "These encrypted messaging platforms...make it harder for law enforcement to track their activity."

Authorities Struggle Against Encrypted Scams

Corrons further detailed the challenges authorities face due to the nature of encryption: "End-to-end encryption means the messages are only visible to the sender and recipient. While this encryption has a number of benefits for personal privacy, it also makes it difficult for authorities to intercept criminal behavior."

This challenge has increased scammers' confidence in operating under the veil of encryption, leaving victims with little recourse once deceived.

Norton's research revealed that scammers have also impersonated other celebrities and public figures like Michael Saylor, Joe Rogan, Mr. Beast, Donald Trump, and Tucker Carlson in similar scams, demonstrating the widespread nature of this fraudulent activity.

FBI and the Surge in Internet Scams

The FBI's Internet Crime Complaint Center reported a significant rise in internet scams. Last year, officials logged nearly 900,000 complaints, marking a 22 percent increase from the previous year, with potential financial losses exceeding $12.5 billion.

Letitia James highlighted the rapid spread of these deceptive videos: "Manipulated videos advertising phony investment scams are spreading like wildfire on social media," urging the public to remain vigilant and skeptical of too-good-to-be-true investment opportunities.

Luis Corrons cautioned potential investors: "However, as AI gets better, some deepfakes are virtually undistinguishable from real videos for the naked eye," suggesting that the technology is advancing at a pace that could outstrip current detection methods.

Consumer Advice Against Deepfake Scams

Corrons advised the public to verify the authenticity of any celebrity endorsement by checking their official social media accounts or websites for denials or disclaimers regarding the promotion of investment opportunities, especially those that seem overly lucrative.

"With investment scams, the message or offer is frequently 'too good to be true,' and often the celebrities themselves publish posts where they distance themselves from such events and campaigns [e.g., crypto giveaways]," Corrons concluded, highlighting a practical step for individuals to protect themselves against fraud.

As the fight against deepfake scams intensifies, authorities like Attorney General Letitia James continue pushing for awareness and preventative measures to protect unsuspecting investors from these highly sophisticated frauds.