Overview
The Hong Kong Securities and Futures Commission (SFC) recently issued a severe warning about a deepfake scam involving Elon Musk, aimed at promoting a fraudulent cryptocurrency trading platform called “Quantum AI”. This incident sheds light on the increasing trend of AI-related fraud, particularly in Asia.
Quantum AI Scam and Regulatory Response
On May 8, the SFC alerted the public to the scam, which uses manipulated videos of Elon Musk to attract investors with promises of unrealistic returns. The regulator urged the Hong Kong Police Force to block access to related websites and social media pages. As of this week, these sites and Facebook groups have been taken down.
Increase in Deepfake Fraud
Incidents involving deepfake technology have surged dramatically, with the Asia-Pacific region experiencing a 1,530% increase in deepfake-related fraud last year. Vietnam and Japan were the most targeted countries, according to a report by Sumsub.
Details of the Scam
- The Quantum AI scam has been operating for at least a year, targeting various groups with different iterations.
- Manipulated videos falsely depicted Elon Musk and Jack Ma endorsing the platform, using footage from events like the 2019 World AI Conference.
- Scammers altered appearances in videos to deceive viewers into investing in the fraudulent scheme.
Technological Exploits and Financial Impact
Scammers utilize inexpensive hosting providers and technologies like WordPress to create convincing websites. One site requires a minimum deposit of $250, advising users to invest only what they can afford to lose completely.
High-profile Deepfake Incidents
Deepfake technology has led to significant financial losses, such as a Japanese bank manager being deceived by a fake audio resulting in a $35 million transfer.
Ongoing Efforts and Additional Warnings
The SFC remains vigilant in flagging crypto-related scams, issuing warnings about suspicious virtual asset trading platforms. Efforts to combat fraudulent activities continue as the financial landscape evolves.
