Fake IDs and documents have always been an issue in the real estate sector. Yet creating them convincingly used to be a skill reserved only for sophisticated fraudsters. Now, of course, AI has completely changed this.
Deepfakes are already becoming highly realistic, equipping fraudsters with the ability to create convincing fake IDs and synthetic identities by manipulating images.
A whole new range of bad actors have access to these capabilities and can carry out fraud faster and at a greater scale too.
Red flags that used to be noticeable to the human eye are becoming far harder to spot. AI tools even have the ability to construct entire fake social media profiles and live video avatars, making background checks harder to perform. It’s why Deloitte has predicted that by next year, financial fraud from generative AI and deepfakes could reach $40 billion in the US alone – a problem that could easily be reflected in the real estate sector.
So, when AI can alter documents in seconds, images can be deepfaked and paper documents are inherently unreliable, how do estate agents know what to trust?
THE AI THREAT
Fraudsters can now use AI to produce hyper-realistic, pixel-perfect fake identity documents such as passports, driving licences and utility bills that easily overcome traditional identity and verification (IDV) checks.
Techniques like synthetic identity generation also enable them to blend real and fabricated data to construct new identities and pass Know Your Customer checks, such as stealing a real person’s face but using a fictitious name.
One step around this for estate agents has been to incorporate ‘liveness’ detection checks with a selfie or video call.
But AI deepfakes are becoming more sophisticated at bypassing these checks. While live avatars often have telltale signs of being AI that are detectable to the human eye, they’re not far off becoming highly believable.
In fact, there have already been high-profile cases of this type of fraud – in 2024, a worker got duped into paying £20m by a deepfake video call. As such, IDV techniques are having to evolve rapidly to meet this advancing threat.
KNOWING WHAT TO TRUST
In the age of AI, solely trusting photos of identity documents has ceased to be an effective verification tactic.
Instead, what’s required is a shift from document scrutiny to data integrity – real estate firms need the ability to ensure submitted files haven’t been digitally tampered with or AI generated, and that depends on using IDV technology.
For example, rather than relying solely on photos of identity documents, IDV technology can use a smartphone’s NFC (near-field communication) reader to extract biometric and cryptographic data directly from the microchip embedded in passports and other biometric ID cards.
This ensures verification accuracy and protects against AI fraud. An effective IDV platform should then be able to check the person’s name and identity against official databases like the electoral roll and sanctions lists.
These actions can be combined with a real-time biometric facial recognition and liveness check. In this instance, IDV platforms can analyse physical characteristics and compare a live selfie or video with the document ID photo to ensure they match and haven’t been manipulated with AI. Of course, as AI deepfakes become harder to spot, IDV processes will need to evolve further to provide even more robust IDV capabilities.
COLLABORATION AND EFFECTIVE IDV
To truly combat the threat of AI fraud, collaboration is crucial, both within real estate and with other sectors like tech.
A key initiative that could take a big step towards tackling synthetic identities is digital IDs and digital wallets.
A digital ID provides a secure, tamper-proof way of verifying an identity, and once stored in a digital wallet, it can be combined with other verification steps such as anti-money laundering checks and sanctions screening to build up a detailed compliance profile of a person. Crucially, the ID only needs to be shared once via a secure platform instead of over channels like messaging apps and email, which increase the chances of fraud.
What’s more, there are innovations from other sectors that could be used to enhance IDV processes. Zoom and Tinder recently introduced ‘proof of humanity’ eye scans in order to tackle the growing sophistication of AI – is this something for real estate and IDV firms to follow? While the sector might need a tailored approach, what this example does show is the need for the sector to be open and agile to innovative approaches in order to keep pace with the latest advancements in AI fraud.
AI poses a great challenge for real estate, giving far more people the ability to create convincing synthetic documents and identities.
As it becomes harder to trust what you see, the need for advanced digital IDV solutions coupled with employee awareness is critical for maintaining trust and credibility in the sector.
