Experts warn about growing problem of AI fakes in business: "AI fraud is streets ahead of public awareness"

EXPERTS have warned about the growing problem of AI fakes in business.

AI now churns out photorealistic business owners, convincing branding, and documentation slick enough to fool basic checks. 

And it's not stopping at dodgy webshops – official business registries are under siege.

Companies House, wielding emergency powers under the Economic Crime and Corporate Transparency Act 2023, reported it had already corrected or removed dodgy information affecting 100,400 companies  by 2024. 

It's blocked another 10,200 suspicious applications, many linked to mass company formations at single addresses, a hallmark of money laundering operations.

Colette Mason, Author & AI Systems Architect at London-based Clever Clogs AI, said it's becoming hard to work out what is real in business.

She added: "AI can now fake pedigree, paperwork, and people faster than regulators can blink. Proven authenticity just became a business superpower. 

“If AI can fake a founder, the only true differentiator left is proof of life: real humans-in-the-loop, real craft, real contact. Trust isn’t just moral currency anymore. It’s fast becoming the lifeblood of reputable ecommerce.”

Mitali Deypurkaystha, Founder/CEO at Newcastle upon Tyne-based Impact Icon AI, shared some advice on how to avoid the pitfalls.

She continued: "Family firms can’t out-fake AI, but they can out-prove it. In a world where algorithms can fabricate “heritage” overnight, authenticity becomes a new form of capital. Real businesses must show their humanity in plain sight, lots of behind-the-scenes posts spread over time, community moments, charitable endeavours, unpolished stories. 

"That trail of candid content becomes living proof of existence. AI can simulate charm, but not the slow, messy record of a real life unfolding online. Government must enforce business identity checks and provenance standards. 

“But tech firms bear the real duty. Platforms profiting from generative tools must build in deception detection and clear accountability pathways. They must not be allowed to follow the path of social media platforms in the past, doing the bare minimum to protect users and turning a blind eye to deceptive content.”

Clive Bonny, MD at Strategic Management Partners, said it is also an issue in recruitment and universities.

He added:  "AI fraud is streets ahead of public awareness. No public online data is safe. Your voice and photo can be quickly cloned. Besides Companies House data, Brit ID cards are at risk of cloning. 

“As a personal background vetter I am also seeing many more job hunters using AI to replicate professional qualification certificates and University students are using AI in dissertations to artificially boost grades. Employers must now test job applicants onsite before offers.”

Kundan Bhaduri, Entrepreneur and Landlord at London-based The Kushman Group, said he needs to meet potential tenants due to worries about AI.

He continued: "It is time to go back to the good old style of functioning. We no longer offer tenancies on virtual viewings or online checks only. Until I have seen the whites in the eyes of the proposed tenant, and have asked them to regurgitate their story in my face, we are not doing business with them. 

“The entire foundation of high street relationships built on trust, documentation, and assumed human existence is now under threat. Property investors evaluating commercial tenants now face the prospect that impressive corporate histories, glowing references, and professional headshots may be entirely algorithmic creations designed to secure premises for money laundering operations.”

Scott Gallacher, Director at Leicester-based Rowley Turton, said he was tricked himself.

He added: "The misrepresentation of Chinese companies as UK retailers is becoming increasingly common – and it’s one that even caught me out when ordering a ‘Mod’ suit for my son. 

"We genuinely believed we were buying from a UK-based store, but only after placing the order did we realise it was actually shipping from China. While the suit fortunately turned out fine, we were immediately concerned about quality, accuracy, potential customs charges, and the practicalities of returns under distance selling regulations. 

“Many people won’t be so lucky, and it’s easy to see how AI-generated shopfronts could make this kind of deception far more convincing – and far harder for consumers to detect.”