Your Cookies are Disabled! NationalNotary.org sets cookies on your computer to help improve performance and provide a more engaging user experience. By using this site, you accept the terms of our cookie policy. Learn more.

Special Report

Notaries are more important than ever amid the rise of Artificial Intelligence.

A human with a robotic left side of body and arm, waving hello with its left hand.

This is the first in a series of articles focused on Notaries and how they can navigate through the age of Artificial Intelligence.

AI Powered ‘Synthetic Identity Fraud’ Is Expected To Cause Billions in Losses by 2030

Earlier this year, it was reported that a finance worker at a multinational corporation in Hong Kong was scammed into sending a $25 million wire transfer to criminals. How did it happen? The worker was directed to make the transfer during a videoconference with the company’s Chief Financial Officer and several other members of the staff.

The problem was that the CFO and employees were not real, but digital imposters created by the criminals using “Deepfake AI” technology. The worker saw their faces, heard their voices, and watched them move and interact with their environments and each other.

These elaborate fraud and financial scams are becoming more common with Artificial Intelligence (AI) technology, setting off alarm bells for consumers, business owners, and risk managers, among many others. While the mass use of AI is relatively new for everyday users, the technology has advanced so rapidly that criminals have developed a significant edge because the technologies to detect AI fraud are still emerging.

In August of 2023, leading credit bureau TransUnion reported that U.S. lenders had already experienced $2.9 billion in losses due to AI-assisted fraud. The numbers continue to rise.

Synthetic Identity Fraud

The use of stolen personal information from real people, like social security numbers, combined with made-up details to create fake identities to impersonate their victims and commit fraud.

AI is being leveraged to impersonate individuals by using sophisticated voice and visual manipulation to create near-perfect fake IDs and other identification documents, to create realistic-looking phishing emails, to fuel cyberattacks, and to easily avoid fraud detection methods, among many other nefarious uses.

Amid the skyrocketing concerns to combat these crimes, one reality continues to rise to the surface: Notaries are more important than they have ever been in modern history.

That’s because the level of fraud these criminal actors are promulgating is occurring on a massive scale. In March, ATT reported that hackers stole the data of 73 million people, most of whom were former customers. The data included the victim's first and last name, date of birth, and social security number.

“That is all you need to establish a fake ‘synthetic’ identity based on real data,” said Andy Sheldon, VP of Marketing for Deduce, an AI security firm. “These (criminals) aren’t hoodie- wearing, Pop-Tart eating hackers living in their mom’s basement. These are highly sophisticated, well-funded state actors or corporations who are deliberately trying to undermine every aspect of the U.S. population, from banking fraud to election fraud and everywhere in between.

“The only surefire way to determine if someone is an actual real person is to meet them face- to-face ... and the absolute best way to accomplish that simply and seamlessly is with a Notary Public.”

The rising threat of AI-generated identity fraud

A recent survey of 500 fraud and risk professionals revealed there is significant and growing concern in the financial services industry that the instances of “fake and fraudulent” customers are surging at a rapid pace, and that their security and identity detection technologies might not be able to keep up.

The survey, commissioned by Deduce and conducted by Wakefield Research, further revealed that financial institutions that service loans, issue credit cards, and run credit checks are having a tough time contending with "Synthetic Identity Fraud" in which criminals use “generative AI” technology to steal people’s legitimate personal information, data, voices, and photos to impersonate them and commit fraud.

Criminals also use AI to handle nefarious automated tasks to scrape the Internet and other data sources at lightning speed, stealing personal data and generating fake corresponding data, empowering them to better masquerade as their victims.

Generative AI

The use of artificial intelligence tools capable of producing content, including text, images, audio, video, and data with simple prompts.

The threat is so significant that the U.S. Department of Justice recently announced it is beefing up its enforcement efforts on criminals using AI and could enhance sentences for those convicted.

“AI is a great peril when criminals use it to supercharge their illegal activities, including corporate crime ... our prosecutors will be seeking stiffer sentences — for individuals and corporate defendants alike,” said U.S. Deputy Attorney General Lisa Monaco at an American Bar Association conference in March. “Compliance officers should take note. When our prosecutors assess a company’s compliance program, they consider how well the program mitigates the company’s most significant risks. And for a growing number of businesses, that now includes the risk of misusing AI.”

Last July, the Deloitte Center for Financial Services estimated that synthetic identity fraud could cause at least $23 billion in losses for financial services firms by 2030. During that time, these crimes are expected to become more frequent while industries struggle to catch up with methods to detect them.

That’s where Notaries come in.

How Notaries can stop AI identity fraud

From the idea of telephone-based notarizations in the 1970s, to the rise of computers, the Internet, biometrics, and blockchain technologies, “experts” are again predicting the imminent demise of Notaries. They contend that technology could easily and more accurately perform the identity verification function that Notaries provide; however, technologies have created new risks for fraud, making Notaries even more essential.

Life-changing transactions like mortgages, estate plans, powers of attorney, adoptions, I-9 verification forms, and medical directives, among many others, require professional standards of care that only Notaries can provide — trust, discernment, and human judgment – none of which AI can possess.

There is no better example of how important those principles are to our economy and our nation than the government’s response to notarizations during the COVID-19 pandemic.

In a recent keynote at the Maryland Notary Public Day Conference, NNA Vice President of Government Affairs Bill Anderson recounted that in March 2020, U.S. Treasury Secretary Steve Mnuchin declared that Notaries Public are essential to the work of our nation. During the COVID-19 lockdowns, states could have issued temporary suspension of all laws requiring documents to be notarized. They did not.

“What would have happened? There would have been more forgeries. In the case of trust documents or powers of attorney ... there would have been more will contests between heirs and beneficiaries,” Anderson said. “They did not suspend these laws because they realized the gain wasn’t worth the pain. And we learned that Notaries are essential. Your jobs are so important that you must keep working for the good of all of us and our country.”

Deepfake AI Technology

A type of artificial intelligence used to generate and create convincing images, audio (voice), and video to impersonate a person and, ultimately, to perpetrate hoaxes and fraud.

Need more proof of why Notaries are more important than ever? Even AI platforms like ChatGPT, Google’s Gemini, and Microsoft’s Copilot say they are. In recent queries on all three platforms about the importance of Notaries, they all gave similar responses that revolved around the following principles:

“Notaries Public perform a variety of duties beyond document authentication, including witnessing signatures, administering oaths, and certifying copies of documents. These tasks often require human judgment, discretion, and interpersonal skills, which may not be easily replicated by AI.”

Notaries also meet face-to-face with document signers, whether in person or via remote online notarization; they are specially trained and supported to handle their duties; they are aware of complex and sometimes regional legal requirements to perform notarizations; they know how to handle complex transactions that require a human to navigate properly; and they have a legacy of trust and confidence amid their regulatory oversight to provide their service.

So, as we embark on this new era of synthetic identity fraud and massive risks to our transactions and the economy, a Notary’s human element of judgment, trust, and legal remains indispensable, ensuring the integrity and validity of transactions in a complex and evolving landscape of risk.

That will not change anytime soon.

Phillip Browne is the Vice President of Communications at the National Notary Association

19 Comments

Add your comment

Yvonne

13 May 2024

This is very good information, for I am planning to become certified as an online notary.

Noemi Gotay

13 May 2024

This is an eye opener for me. Thank you

Barbara Holland

13 May 2024

The vulnerability of our society is very concerning. I hope that the companies that hire notaries and put this level of responsibility on us will understand and act on this fact and compensate us as professionals, I also expect the NNA to advocate in this matter for its paying members.

Pilar Williams

13 May 2024

I firmly believe that because of this AI stuff that RON Notaries are going to become illegal. I own a Fed Ex authorized ship center that has mailbox rentals. We had a Virtual mailbox holder who had a several fake ID's where he used sex offender picks to rent a box. He had his 1583 form signed online with a Virginia RON Notary. He used AI Generated person to get his verification done. When the real John Doe came into our store with a Police Report we instantly closed his box and help John Doe try to catch the person. Thank goodness it was only his name and address that was stolen but everything else was fake. the Geico car insurance card that was provided was fake as well as the Florida Driver license. I no longer do RON Notaries because of AI. If you are not in front of me personally and do not have a valid ID that I can touch, I will not notarize your documents.

Douglas L Jackson

13 May 2024

The threat of fraud is becoming more and more prevalent in our society. Why and how the actors of scams are ahead of the game and those who try to prevent are lagging behind is a mystery to me. Why can't the preventers get ahead of the scammers?

Reuben E Rivera

13 May 2024

This is a very good bulletin because it explains the importance of the human touch. AI is an important element in some places, but we can't let it replace the human element as well. We must not get carried away with all automated stuff and get back to human labor. There is nothing wrong with people just working on their own.

James Holland

13 May 2024

I fear the genie is already out of the bottle on this dilemma. The legal enforcement structure is only in it's infancy stage compared to the "bandits" on the loose. I think one of the complicating factors will be the issue of privacy and how we (enforcement) handle pursuit while protecting privacy and civil rights. Where is the proper balance point of transactional speed and convenience, and due diligence to verify legitimacy of the transactions and minimize/eliminate risk to consumers.

Natalia Dimaano

13 May 2024

Very good and informative article. It made us aware of our great responsible as a notary public. Thank you.

Lily

13 May 2024

This is very important to everyone of us. Thank God , for this.

Nannette Joy Kingsbury

13 May 2024

I will not do online Notarys. Too dangerous now. I want to see a body with a face across the desk before I will even think of it!

Carol Graves

13 May 2024

I agree with Pilar and will not be doing online if it does ever get started in CA. It is an open door for scammers and fraud. Notaries will be left open for too much liability. E&O does not cover much. I have done loan signings for 9 years in front of the actual person. Why would I want that kind of exposure??

Afi Phoebe

13 May 2024

good to know

Barbara R Robie

13 May 2024

I will not notarize a signature from a person who doesn't appear before me personally without a valid driver's license. You can still have a person with a fake government issued ID, but that's rare. Each notary really has to stand his or her ground.

Judy C Johnson

14 May 2024

How is current technology on RON platforms keeping up with the technology criminals are using to defraud? Are the platform owners responsible for deterring this new fraud? How is the average Notary Public being educated to detect AI fraud? Who will be ultimately responsible should someone be deceived? Hopefully, NNA is working on producing educational materials for it's members' instruction.

J. Siegel

14 May 2024

Barbara, why must it be a driver's license? Every state has their own list of acceptable forms of ID.

Walter N Winston

15 May 2024

This is so essential in this day and age because technology is evolving faster than we can keep up and the hackers are ever present in all forms of discrediting our values of trust and honesty.

mschelestephens@gmail.com

16 May 2024

This article was very informative. I had thought about pursuing RON credentialing, but I will leave it alone now.

Bree

23 May 2024

RON will cause more fraud then ever before, Look up JustNotarized, they are a live secure notary application. They are not remote, Its a digital signing however its live, the signer is in infront of you through the notarization, the signers ID is scanned through third party verification using the app, validating the signers identity, if ID is fake the system will not allow the notarization to continue. live ink still, stamp. However this application prints a unique barcode that is placed on the document notarized and is stored. Any tampering to the document will not succeed. Check it out!

ej.howard@me.com

27 May 2024

What a wonderful time to be living. We get to talk about things that are closest to our heart. And the best part is that as individuals we can choose the path we want to take. As a new notary I am grateful for that. I find it amazing that there are so many loopholes left wide open that make it easy to take advantage of the uninformed or unaware. Much of the devastation is accomplished by simple things like social engineering, one of the most common failures. How else do they come up with these crazy ideas? Are we just to trusting and afraid to verify? While I realize there is no one sentence answer to any solution, education and vigilance can play a large part in our day to day activities. And trying to better understand human nature might help us be more alert to opportunities for failure in our own daily activity processes. I think the message in this article post is loud and clear. As technology becomes better and better, we hope that we as humans do the same. Be more watchful, ask more questions, employ better tools and techniques, invest in better technology, do more product testing, submit constructive feedback. Trust, but verify. Things are going forward. We can adjust and make our lives better and learn to live and function successfully and securely. Thats my story and I'm sticking to it.

Leave a Comment

Required *

All comments are reviewed and if approved, will display.

Close