AI is making scams smarter … and more dangerous

Americans lost over $16 billion to online scams in 2024

By Truman Lewis of ConsumerAffairs

May 23, 2025

• Americans lost over $16 billion to online scams in 2024 a 33% increase from the year prior.

• Generative AI is making scams harder to detect, more believable, and more frequent, says Consumer Federation of America.

• Seniors lost nearly $5 billion, with calls for stronger regulation and corporate accountability growing louder.

A new report from the Consumer Federation of America (CFA) paints a troubling picture of how generative artificial intelligence (AI) is rapidly transforming the landscape of online fraud.

Titled Scamplified: How Generative AI Can Amplify Scams and Fraud with No Regulation or Responsibility, the report details a dramatic surge in digital deception, exposing how cutting-edge AI tools are being hijacked by bad actors to carry out more sophisticated, targeted, and difficult-to-trace scams.

According to the CFA, U.S. consumers lost more than $16 billion to online scams in 2024, a 33% jump from 2023. Alarmingly, older Americans bore the brunt, losing nearly $5 billion a figure the report stresses is likely a severe undercount due to chronic underreporting.

Generative AI: A new weapon

From deepfake audio impersonations of family members in distress to chatbots capable of generating phishing emails free from typos or awkward phrasing, generative AI is fueling a new wave of hyper-realistic scams. The report highlights how these tools are being used to execute frauds that are far more convincing and widespread than in the past.

Its irresponsible and unacceptable for companies to facilitate false content creation aimed at impersonating, defrauding, and blackmailing the average consumer without robust moderation, said Ben Winters, CFAs Director of AI and Privacy.

Winters added that tech companies have been allowed to self-regulate too long, effectively giving scammers powerful new weapons with minimal oversight.

The scam stack

The report outlines what it calls the scam stack an ecosystem of loosely regulated technologies working together to enable modern fraud. These include:

• Data brokers selling personal information.

• Robocall systems targeting thousands at a time.

• Social media platforms where scams often originate.

• Payment processors that provide minimal fraud controls.

The CFA warns that without immediate action, the situation will worsen as scammers continue to exploit AI tools faster than regulators or tech companies respond.

Urgent need for regulation

The CFA calls for a sweeping overhaul of how tech companies are held responsible for misuse of their platforms. Recommendations include:

• Stricter moderation requirements for generative AI tools.

• Federal regulations to limit the unchecked spread of fraudulent content.

• Consumer protections and mandatory reporting mechanisms for financial fraud involving AI.

This is not just a tech problem its a consumer protection crisis, the report concludes.

As AI continues to shape the digital world, consumer advocates warn that failing to regulate its abuse in fraud schemes could result in billions more lost, particularly for vulnerable populations like seniors. The CFAs message is clear: without proactive regulation and meaningful accountability, AI will continue to amplify fraud at an alarming scale.

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