AI’s Role in Identity Theft: Better Business Bureau Warns the Public

As AI technology advances in 2025, identity thieves are weaponizing these tools to steal personal information at unprecedented rates, costing Americans over $125 million annually.

Quick Takes

The Growing AI-Powered Threat

Identity theft is expected to continue its alarming upward trajectory through 2025, according to the Better Business Bureau (BBB). Criminals are increasingly leveraging artificial intelligence to enhance their fraudulent activities, making their attacks more sophisticated and harder to detect. The fraud prevention service Cifas has explicitly identified AI as a key factor “fuelling [the] identity fraud increase” across the country. This technological evolution has transformed what was once a labor-intensive criminal enterprise into a streamlined, automated operation that can target thousands of potential victims simultaneously.

The statistics paint a disturbing picture. The Federal Trade Commission reported more than 840,000 identity fraud cases in the United States in 2024 alone. Account takeover fraud, where criminals gain access to existing accounts, increased by 76% in the past year, with over half of these cases involving hijacked mobile telephone accounts. Perhaps most alarming is the 1,055% increase in SIM swap fraud, where criminals transfer a victim’s phone number to a device they control, bypassing security measures that rely on text message verification.

How AI Empowers Identity Thieves

Artificial intelligence has become a game-changer for identity thieves, providing them with powerful tools to create convincing forgeries and bypass security systems. Criminals now use AI to generate false documentation that can pass verification checks, making it increasingly difficult for financial institutions and service providers to distinguish between legitimate customers and fraudsters. This technological advantage allows scammers to operate with unprecedented “speed, sophistication, and scale,” creating identity theft operations that were unimaginable just a few years ago.

“We do want people to know there’s many sites on the dark web where someone’s information may be getting shared,” warns Michele Mason from the Better Business Bureau.

Threat actors are employing increasingly diverse tactics, from taking over social media accounts to solicit money from friends and family to impersonating individuals to rent apartments or open credit cards. Brian Edwards of the BBB explains that identity theft exists on a spectrum: “Sometimes just pieces of information are stolen, say it’s an email or a phone number and that’s people getting those spam texts from scammers or getting spam emails… Those scammers have stolen your information from somewhere and are using those to try and perpetuate a scam.”

Protecting Yourself in the AI Era

With local law enforcement often unable to assist due to the international nature of many scams, prevention becomes crucial. The BBB recommends a two-pronged approach to safeguarding your identity: protect your personal data and monitor your accounts vigilantly. “One is to protect our data, make sure we’re not giving it out to unknown sources. The second is to monitor our information, especially if we find out there’s a chance our information got compromised in a data breach,” advises Michele Mason.

Specific protective measures include implementing credit freezes, which prevent new accounts from being opened in your name; enabling multi-factor authentication on all accounts; using strong, unique passwords; securing internet connections with a VPN; and regularly monitoring credit reports for unauthorized activity. The Federal Trade Commission offers free resources for victims of identity theft, and suspected cases can be reported to the BBB Scam Tracker, FTC, or FBI. Taking these precautions is essential as AI technology continues to make identity theft more accessible and profitable for criminals.