AI and fraud in the UK: the new face of financial crime

A few years ago, if someone told you a fraudster could replicate your voice with a 10-second audio clip and drain your bank account, all before your morning coffee,  you’d probably laugh it off. Today, that’s no longer science fiction. It’s a Monday morning in modern Britain.

Financial crime is evolving. Fast and artificial intelligence is right at the heart of it.

This Isn’t Just Another Tech Scare

Let’s be clear, AI isn’t the enemy. In fact, it’s already doing great work in compliance, fraud detection, and risk monitoring. But like any tool, it depends on who’s wielding it. Criminals are getting their hands on sophisticated AI models, and they’re not wasting time figuring out how to weaponise them.

Take deepfakes. We’ve moved beyond grainy photoshopped IDs. Today’s fraudsters can spin up convincing digital personas, mimic voices to perfection, and send phishing emails that would fool even the most cyber-savvy. One executive recently told Financial News he nearly fell for a voice note that sounded just like him - because it was, in a way. AI had cloned his voice from online recordings.

This isn’t isolated. Feedzai’s recent report suggests over half of global fraud attempts now involve AI. And in the UK, banks are facing a surge in what I’d call “synthetic fraud”: crime facilitated by data, code, and clever machine learning,  not crowbars and balaclavas.

Our Laws Are Still Catching Up

The UK has made some moves; the Economic Crime and Corporate Transparency Act 2023 tightened rules around corporate reporting and ownership transparency. But when it comes to AI, those tools are starting to feel outdated.

We’re trying to catch digital criminals with analogue laws. It's like chasing a Tesla on a bicycle.

That’s why the upcoming Crime and Policing Bill 2025 is getting attention. It proposes something bold, holding senior managers personally liable for criminal acts committed within their firms, including those aided by AI systems. It’s a sharp pivot from the old “directing mind” doctrine, which often let executives off the hook unless they were directly involved.

If this bill passes, the C-suite won’t be able to shrug off responsibility for algorithmic failures or rogue automation. And that’s a game-changer.

The Online Safety Act: Quietly Crucial

While the headlines tend to focus on social media and child safety, the Online Safety Act 2023 might be one of the most underrated pieces of legislation when it comes to financial crime.

Here’s why: the Act forces online platforms to actively monitor and remove illegal content, including scams and fraud. It doesn’t just suggest they try; it makes them legally responsible. Ofcom has the power to demand that these platforms use AI tools to detect fraud, and if they fail? They’re looking at fines of up to £18 million or 10% of global turnover.

That’s not small change. And it means platforms that once turned a blind eye are suddenly scrambling to build real-time fraud detection systems. It also means that as AI becomes more capable, regulators are expecting companies to keep pace or pay the price.

Regulators Are Treading Carefully - Maybe Too Carefully

The Financial Conduct Authority (FCA) has been pushing for responsible AI use through its AI Public-Private Forum and the AI Sandbox. It’s a start. But let’s not kid ourselves, these are still early steps.

Without hard rules, we’re relying on companies to self-regulate.  As we’ve seen in tech time and again, that rarely ends well.

Some Firms Are Leading the Way

NatWest’s partnership with OpenAI made headlines this year, and rightly so. They’re integrating large language models to spot fraudulent behaviour in real time. It’s ambitious,  and it shows that parts of the industry are willing to innovate before regulators force their hand.

But even this raises questions. If an AI system flags a legitimate transaction as fraud and delays payment, who’s liable? What if it misses a scam? These are the grey areas we’re only beginning to understand.

Culture Still Matters More Than Code

At the end of the day, no law or algorithm will fix this if companies don’t take fraud seriously at a cultural level. That means investing in proper training, doing more than the minimum, and embedding ethical risk into boardroom discussions, not just compliance checklists.

As The Times rightly put it, the law can only go so far. The rest is up to us.

What Comes Next

AI is already changing financial crime, not next year, not someday. Now. And the question isn’t whether we’ll adapt, but how quickly.

For lawyers, regulators, and firms alike, this is a moment of reckoning. We need smarter laws, better enforcement, and a mindset that puts responsibility on the same level as innovation.

Because if we don’t get ahead of this curve, we’ll be chasing shadows. And in the world of AI-driven fraud, shadows move fast.

How Forbes Solicitors Can Help

The rise of AI-driven financial crime marks a new era of legal and regulatory challenges. With deepfakes, synthetic fraud, and automated scams becoming more sophisticated by the day, businesses and individuals alike face heightened risk and heightened scrutiny. At Forbes Solicitors, we’re here to help you stay ahead.

Whether you're navigating the implications of the Economic Crime and Corporate Transparency Act 2023, preparing for the incoming Crime and Policing Bill 2025, or grappling with liability in the use of AI systems, our expert team can provide the strategic guidance you need.

We advise financial institutions, tech companies, senior executives and regulated professionals on everything from AI governance and compliance frameworks to defending against investigations involving digital fraud and algorithmic failure. We also help firms develop resilient risk management systems that align with both current and upcoming regulatory expectations.

Led by Craig MacKenzie, Partner and Head of our High-Profile & Private Crime Division, our team combines specialist knowledge of economic crime with cutting-edge insight into AI and digital regulation. We work with discretion, urgency, and precision to protect our clients' interests in this fast-changing legal landscape.

If you’re concerned about AI-related fraud risk, regulatory exposure, or potential liability under new laws, contact Craig at [email protected] or call 01772 220022.