The Securities and Exchange Commission (SEC) is cautioning the public against rising cases of fraudulent investment schemes powered by artificial intelligence (AI).
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In a statement issued on Friday, July 25, the Commission revealed that these unlicensed schemes are using sophisticated AI tools to manipulate audio, video, and facial features to impersonate public figures and create fake endorsements.
“These operations are not licensed by the SEC and are designed to defraud unsuspecting investors,” the statement warned.
According to the SEC, some of the telltale signs include:
- The unauthorised use of images and names of politicians, regulators, and celebrities to appear credible.
- Promises of unusually high returns in a short time frame.
- Lack of transparency, including no physical addresses, verifiable contact persons, or valid licenses.
- Anonymous operations mostly on social media and unregulated digital platforms.
The Commission urged the public to be vigilant and avoid schemes that sound too good to be true.
It also confirmed that it is working closely with law enforcement to investigate and shut down these fraudulent operations.
