Deep Fakes: Educating Teams to Spot and Stop Synthetic Threats
- Alternit One
- 7 days ago
- 3 min read
The rise of deep-fake technology represents one of the most significant and fast-evolving risks facing hedge funds today. What began as a novelty, digitally manipulated videos or voice recordings circulating online has rapidly become a tool for sophisticated fraud, social engineering, and reputational damage. Incidents of synthetic identity and manipulated media attacks against financial services firms rose by 47% year-on-year, according to Sensify’s State of Digital Fraud 2024 (SODF) report. This is consistent with wider industry warnings: in late 2024, the U.S. Treasury’s FinCEN issued an alert highlighting the increasing use of deep-fake media in fraud schemes targeting financial institutions.
The Mechanics of Deep Fakes
Deep fakes use artificial intelligence to generate highly realistic but fraudulent video and audio content. Attackers may impersonate a CEO’s voice to request a wire transfer or fabricate video evidence to gain credibility in social engineering campaigns. The technology’s accessibility means threat actors no longer need specialist skills. Cheap tools and online tutorials are now sufficient to create convincing fakes.
Why Hedge Funds Are Prime Targets
Hedge funds manage large sums of capital, often move money quickly, and rely heavily on digital communication for speed. These characteristics make them prime targets for attackers who exploit urgency and authority. A fabricated audio call from a portfolio manager instructing a junior team member to act immediately may be all it takes to cause significant financial and reputational damage.
Spotting the Signs
Teams must be equipped with the skills to recognise manipulation. Key indicators include:
Mismatched audio and visual cues (e.g., blinking patterns or unnatural pauses).
Background inconsistencies in lighting or sound quality.
Contextual red flags, such as unusual requests outside of normal processes.
Training is critical. According to Sensify, firms that conduct quarterly awareness sessions reduce the likelihood of successful synthetic identity fraud by 35%. Similar findings emerged in a Deloitte-supported survey by Regula, where executives confirmed that staff education was one of the most effective defences against synthetic identity attacks.
Safeguards That Work
Technology must complement awareness. Sensify’s deep-fake detection tools, for example, use AI to analyse biometric inconsistencies and metadata traces invisible to the human eye, offering a second layer of defence. When integrated into IT security workflows, these tools flag suspicious content before employees act on it.
Best practice for hedge funds includes:
Embedding deep-fake detection into compliance and IT systems.
Establishing verification protocols (e.g., multi-factor confirmation for all high-value instructions).
Running simulated attacks to test response and resilience.
Independent research reinforces the financial stakes. In a 2025 statement, the U.S. Securities and Exchange Commission noted that over a quarter of surveyed executives had already experienced deep-fake incidents, with average losses exceeding US $450,000 per case.
Building Resilience
Deep-fake technology is here to stay, and attackers will only become more sophisticated. In 2024 alone, more than 105,000 deep-fake attacks were recorded in the U.S., resulting in over US $200 million in confirmed losses. One of the most striking examples was the £25 million fraud against London-based engineering group Arup, where employees were deceived by AI-generated impersonations of senior executives.
The challenge for hedge funds is to stay one step ahead by combining education, vigilance, and detection technologies. Firms that empower their teams with knowledge and integrate advanced tools into their IT environments can materially reduce their exposure to synthetic threats.
