KUALA LUMPUR: Artificial intelligence (AI) is proving a double-edged sword in the financial sector, experts said.
While it strengthens security in Malaysian banks, criminals are using the same technology for fraud, scams, and identity theft, panelists warned at the 15th International Conference on Financial Crime and Counter-Terrorism Financing 2025.
United Nations Interregional Crime and Justice Research Institute (UNICRI) Programme Management Officer Carlotta Zenere said that criminal syndicates, rather than terrorist groups, are currently the leading actors leveraging AI to disguise their identities, conduct cyberattacks, and orchestrate complex financial scams.
“These organised crime networks use artificial intelligence, cyberattacks and other sophisticated techniques to disguise their identities and commit fraud of all kinds,” she said.
“They don’t operate alone; they rely on intermediaries and proxies, some of whom are linked to state actors. That’s the reality.
“While extremist organisations such as the Islamic State have used technology mainly for propaganda and fundraising, their use of AI remains relatively unsophisticated compared to the tactics employed by profit-driven crime networks,” she said.
Meanwhile, on the potential use of fingerprint verification at automated teller machines, SymphonyAI Financial Services Head of Strategy and Innovation Jason Shane said banks should look beyond fingerprints as the sole means of biometric authentication for ATMs, noting that emerging technologies offer far more sophisticated ways to confirm a user’s identity.
He said the financial industry is witnessing rapid progress in artificial intelligence (AI)-driven verification systems that can detect subtle human indicators, such as blood flow beneath the skin, to confirm that the person interacting with the machine is real.
“There are companies we work with where the technology is profound, using AI to identify blood flow below the skin to ensure there’s a true human at the end of it,” he said.
While acknowledging that fingerprint-based systems could be vulnerable to cloning or spoofing attempts, Shane said innovation in areas like voice and facial recognition continues to evolve quickly and could redefine the way banks conduct onboarding and Know Your Customer (KYC) processes.
“I’m not sure about the whole fingerprint approach because there are ways it can be cloned,” he added.
“But I continue to be optimistic about the technology coming through, and the companies we’re working with give me confidence that the industry is moving in the right direction.”
He also noted that card cloning remains a more pressing concern for most banks, but the convergence of AI, biometrics, and real-time data analytics would likely create more secure and seamless verification experiences for customers at ATMs in the near future.
Meanwhile, Asian Institute of Chartered Bankers chief executive Edward Ling said Malaysia’s banking institutions are currently on par with global averages in adoption of AI, with about half of financial institutions reporting active AI integration.
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