AI scams proliferating

I’m sure a lot of people have noticed the proliferation of AI-generated scams popping up on social media using video and audio clips of well-known and respected businessmen offering investment schemes that promise high interest rates or returns.

I have personally seen AI-generated scams using the image and spliced audio of Ramon Ang, Lance Gokongwei and Jaime Augusto Zobel, and have forwarded those clips to their various communications or public relations people, who in turn have complained to the social media platforms about the misleading investment offers, successfully ensuring that the perpetrators stop using the image and audio of their principals.

For some time, such videos disappeared — or at least I have not seen them pop up in the social media sites that I monitor.

But recently, a new version has surfaced. The most recent AI-generated scam involves spliced ABS-CBN news clips featuring broadcaster Karmina Constantino and Sen. Bam Aquino, giving the investment offer some form of “authenticity,” as some viewers may think that if a trusted media outlet such as ABS-CBN is interviewing Sen. Bam— who also appears to be endorsing the offer — the investment is legitimate.

This time around, I sent a copy of the clip to BSP Gov. Eli Remolona Jr., hoping that the BSP can issue its own warning to the public about such AI-generated videos and perhaps embark on an educational campaign on how financial investments are supposed to work.

Even the Securities and Exchange Commission (SEC) should issue its own warning and advisory, and likewise provide some guidelines.

I cannot assume — and in fact, highly doubt — that all of those who see such videos are able to discern that they are AI-generated, as they still sound too structured and composed, not natural — at least to my perception.

Unfortunately, as the world races to develop AI further, the technology is sure to become more seamless, to the point that unless experts analyze these videos, no one will suspect that they are fake or scams. And because these scam videos target social media, they are shared and eventually gain a life of their own, making them appear like the truth.

Business reporters who cover well-known captains of industry know that such personalities would never personally offer investment schemes to the general public...they are big players and would never resort to retail offers...horrors!

But then, the evolving and increasingly sophisticated AI scams are targeting gullible small investors who are always hoping there really is some way to earn money quickly.

With the growth in financial technology, more and more people are availing themselves of digital wallets and financial platforms, so that at a press of a keypad, an investment transaction is concluded — without giving the gullible investor time to read any fine print that might signal an alarm bell.

In the mid-1990s, I remember a conversation with a Mastercard official who had been working with a local bank to introduce debit cards in the Philippines. He said that it would be the future of financial transactions.

At the time, I argued that they would have a hard time convincing Filipinos because we like to use other people’s money upfront and pay back later — thus the popularity of credit cards, as opposed to the concept of putting money in first on a debit card and using it for cashless transactions.

I never liked the idea of debit cards for the simple reason that I would not earn interest on the cash I keep in a debit card. It was the same reason I did not readily accept the use of the digital Smart and GCash wallets. Why give my money upfront to them so they can earn interest from the pool of funds they get, while I do not? (Thankfully, Smart/Maya now pays interest).

Likewise, Filipinos had already gotten used to their ATM cards to regularly withdraw their cash needs, even though the debit card evolved primarily because the banking industry noticed the general acceptance of automated teller machines.

It took about a decade or more, but eventually Smart/Maya and GCash exploded and debit became acceptable and mainstream because of the convenience — even as the two digital wallets benefited from the pool of funds they manage.

And now, with that financial convenience, AI-generated scams have a platform to exploit even more.

Thus, perhaps, government institutions such as the SEC, BSP, Department of Finance (DOF), Department of Trade and Industry (DTI), Department of Information and Communications Technology (DICT) and other government entities should work together on a regular campaign to actively block and trace the sources of such AI-generated material.

It seems that our government officials, as is often the practice, prefer to remain reactive rather than proactive in facing what they already see as a problem — but choose to wait and see if it escalates before addressing the complaints that will pour in once a significant number of clueless investors have lost their entire savings. Especially now, when the government has once again resorted to taxing our hard-earned savings from a lifetime of already taxed salaries and investments, which continue to be taxed when we reinvest our financial gains.

Of course, the government has once again fallen back on taxation because it still does not properly promote production and trade, while our neighbors and trade partners focus on productivity and selling their well-developed resources — whether in agriculture, minerals or manufacturing.

I guess our public officials firmly adhere to the belief that the only things certain are death and taxes — tax the people to death, perhaps?