Advix Blog

Synthetic identities and fake IDs challenging KYC

Compliance Technology
The rise of AI-generated documents, particularly synthetic identities and fake IDs such as, has created significant challenges for the Know Your Customer (KYC) industry. These challenges include:

  • Increasing sophistication of AI-generated documents: AI technologies have advanced rapidly, making it easier to create highly realistic and convincing fake documents. These documents can mimic the appearance, security features and even biometrics of genuine documents, making them harder to detect using traditional document verification methods.
  • Scalability issues: The sheer volume of AI-generated documents can overwhelm traditional manual review processes, making it difficult for KYC providers to keep up with the influx of potentially fraudulent documents.
  • Regulatory compliance risks: Failure to effectively detect and prevent the use of AI-generated documents in KYC processes can lead to regulatory non-compliance, resulting in hefty fines and reputational damage for organisations.

To overcome these challenges, the KYC industry is exploring and adopting various strategies, including advanced AI-based document verification and biometric authentication.

  • KYC providers are leveraging AI and machine learning technologies to develop more sophisticated document verification systems that can analyze documents at a deeper level, detecting subtle inconsistencies, anomalies, and patterns that might indicate AI-generated content. Integrating biometric authentication, such as facial recognition, liveness detection, and fingerprint scanning, can help verify the authenticity of individuals and prevent the use of synthetic identities.
  • Additionally, implementing blockchain and distributed ledger technologies can create secure, decentralized, and tamper-proof repositories for storing and verifying customer identities and documents.
  • Collaborative efforts and data sharing can also aid in identity verification. KYC providers, financial institutions, and regulatory bodies collaborate to exchange intelligence, best practices, and data on AI-generated document threats, enabling more effective detection and prevention strategies.
  • KYC processes require continuous monitoring and updating to adapt to the ever-evolving landscape of AI-generated document threats. This involves regular software updates, threat intelligence gathering, and ongoing staff training.
  • Collaboration between the KYC industry and regulatory bodies is crucial for developing clear guidelines, standards, and best practices for addressing AI-generated document challenges.

By embracing these strategies and staying vigilant against emerging threats, the KYC industry can strengthen its defenses against AI-generated documents and maintain the integrity of customer identity verification processes.

If we take a look at the list of KYC providers, we can see that some of the top companies are already implementing AI tools to overcome the challenges mentioned above.
  • Trulioo has integrated advanced AI and machine learning technologies into its GlobalGateway platform for identity verification. Trulioo's AI-powered document verification solution can analyse and validate various identity documents, including passports, driver's licences, and ID cards, across multiple countries and jurisdictions. It can detect potential forgeries, alterations, and signs of AI-generated content.
  • Jumio's AI-powered identity verification solutions, such as Netverify and Jumio Document Verification, use machine learning algorithms to authenticate government-issued IDs and detect potential fraud. Their AI models analyze document security features, text consistency, and other indicators to identify AI-generated or manipulated documents.
  • Onfido's AI-based solution, Onfido Document Check, uses computer vision and machine learning to validate identity documents. It detects security features, patterns, and anomalies that may indicate tampered content.
  • Mitek Systems has also developed an AI-powered document verification platform called Mitek Document AI. This solution utilises machine learning, computer vision, and data analysis to authenticate identity documents and detect potential fraud, including AI-generated content.
  • Incode's AI-powered identity verification platform, Incode Omni, includes advanced document verification capabilities. It uses machine learning models to analyse document security features, biometric data, and other attributes to identify potential AI-generated or manipulated documents.