Deduce raises $9 million to tackle AI-generated identity fraud
Deduce has raised $9 million in funding led by Freestyle Capital, with additional investment by Foundry and True Ventures. The funding will launch Deduce’s GenAI Identity fraud solution out of stealth and help the company scale to prevent large-scale SuperSynthetic identity fraud across multiple verticals, including the financial service industry, fintech, and e-commerce.
The rise of generative AI has accelerated efficiency across industries, including organized fraud, with the introduction of platforms such as FraudGPT. Bolstered by these new technologies, fraudsters can leverage AI and stolen PII to create batches of credible digital identities, authenticate those identities with deep fake biometrics, and create online transactional histories.
Utilizing this technology, cybercriminals can leverage automation to create a virtual army of SuperSynthetic identities that are indistinguishable from legitimate identities.
“We stand at a critical juncture where the security and privacy of our most important data is being threatened at an unprecedented level. Legacy fraud prevention methods will no longer be able to protect us from AI-generated fraud,” noted Ari Jacoby, CEO of Deduce.
“Leveraging this new investment, we can take our solution to the market with the speed necessary to prevent this type of fraud from overtaking the organizations we serve,” Jacoby added.
Detecting AI-generated identities requires a massive identity graph that sees the vast majority of the online U.S. population several times each week. Deduce will leverage multi-contextual activity-backed intelligence to help organizations identify Super Synthetic identities during account opening and “sleeper” identities already onboarded.
“We know the rapid adoption of generative AI will enable bad actors to use new technologies to perpetrate fraud,” said Jenny Lefcourt, Partner at Freestyle Capital. “Every company that cares about customer data and identity will need a solution like Deduce provides immediately. Deduce has built a proprietary solution to tackle this new type of threat, so our decision to invest in scaling that solution was simple.”