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It’s every parent’s worst nightmare. It’s 2 a.m. and your phone rings. It’s your child, who’s backpacking across Europe, so you pick up. A voice says they’ve been kidnapped, and unless you send money right away, they’re going to harm them.
The twist? Your child isn’t in danger. They’re safely asleep in their bed. And to add another twist, there was never a real person on the other end of the line. It was all generated by artificial intelligence.
The scam described above is known as a fake kidnapping. They’ve been around for decades. What’s new is that the scale, scope and level of sophistication that scammers can now leverage because of AI.
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As members of the financial independence retire early (FIRE) community, my wife and I write often and publicly about saving and investing our money. But protecting it from online thieves is equally important.
Because we’ve been public about our personal finances for close to a decade, we’re targeted by every type of scam under the sun. AI has now made these scamming attempts increasingly sophisticated.
Gone are the days of easily detectable phishing e-mails riddled with typos and grammatical mistakes. Now, scammers can generate perfect e-mails in multiple languages, audio that perfectly imitates a person’s voice and live video that is indistinguishable from reality.
“In the old days, if you wanted to hold somebody for ransom, it took a lot of human intervention,” says Marc Goodman, retired FBI agent and author of the New York Times bestselling book Future Crimes. “Today, Ransom is an app.”
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You may have seen AI-generated videos of Brad Pitt and Tom Cruise. That same technique can be used to create a photorealistic video of your child, parent, or spouse, tied up and with a gun pointed at their head. All using illegal software that can be purchased on digital black markets.
The audio and video we all post on social media is making these high-tech impersonations possible.
“Now, all they need is a TikTok video of Little Johnny talking for 30 seconds, and they’ve got Johnny’s voice,” Mr. Goodman says. “And they can script these things for emergency scams at scale and they are doing it to defraud parents and grandparents.”
The scalability of AI-powered scams is especially disturbing. While a human scammer is limited by the number of hours in a day, an AI scammer can be “working” 24/7, scamming hundreds or thousands of people at a time.
So how can we keep ourselves, and our money, safe in an increasingly scary world?
The biggest telltale sign of any scam is the sense of urgency.
Scammers rely on emotions such as panic and fear to keep their victims off-balance. And AI-powered scams are so sophisticated now that they can be tailored to what you’re afraid of.
While a parent with an adult child travelling in another country may be susceptible to a kidnapping scam, someone living in the United States with a Hispanic-sounding last name may be more easily scared by AI pretending to be an ICE agent.
If someone calls you and seems to be trying to get you to panic, stop for a few seconds. Ask yourself: How do you know this person is legit?
Any communication can now be faked so convincingly that you can’t tell if it’s real any more. So it’s imperative to verify the identity of the caller.
For most scenarios, this is as simple as hanging up and calling them back. If you owe the CRA money, then another CRA agent would be able to look that up if you call back.
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AI-powered scammers will try to prevent you from doing this by threatening you if you hang up. This can be especially effective in fake kidnapping scams.
In this case, have a secret word or phrase in your family that is used to identify each other. It can be anything, like “coconut milkshake” or “golden retriever.”
Whatever the phrase is, agree on it before your loved one leaves on their trip, and don’t type it into any device. If it’s stored digitally, it can be stolen.
Finally, be especially wary of anyone asking for money using methods such as cryptocurrency, gift cards or wire transfers (like Western Union). Scammers know that to get away with it, the money must be untraceable.
There is never any legitimate reason to pay for your taxes in gift cards or crypto.
“It’s important to build a verification reflex,” Mr. Goodman says. “AI scams work because they feel real and urgent. If money, passwords or urgency are involved, verify on a second channel.”
Bryce Leung and Kristy Shen retired in their 30s and are the authors of Parent Like a Millionaire (Without Being One).
