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Fake Employee Scams on the Rise – The Reasons and How AI Helps That Happened

ElitePersonalFinance
Last Update: April 9, 2025 • Financial News •

According to research and advisory firm Gartner, by 2028, one in four job applicants will be fake.

With emerging artificial intelligence, it is now easier for job applicants to use AI tools to fabricate photo IDs, simulate interviews, and provide predetermined answers. It’s become a lucrative industry for bad actors to essentially extort companies by stealing consumer data, business secrets, and other proprietary information.

Pindrop, specializing in deepfake detection technology using a proprietary AI-generated speech detection system, commented on the latest trend.

“Gen AI has blurred the line between what it is to be human and what it means to be machine,” said Pindrop CEO and co-founder Vijay Balasubramaniyan in a note to CNBC. “What we’re seeing is that individuals are using these fake identities and fake faces and fake voices to secure employment, even sometimes going so far as doing a face swap with another individual who shows up for the job.”

The Role of North Korea in Deepfake Job Employment Scams

One of the major players in deepfake job employment scams is North Korean IT workers. North Korean spies have been known to apply to hundreds of job listings, comprising an overseas network that has caught the attention of the Department of Justice.

In terms of processing, the workers used stolen American IDs and a network of VPNs to disguise their locations. Ultimately, funds received from earned jobs are known to go back to North Korea to contribute towards its weapons programs—and other national interests.

In December of last year, the Department of Justice caught 14 North Koreans using fake IDs to get US-based IT jobs, which was estimated to generate close to $88 million collected over six years from 2017 to 2023. These 14 North Korean nationals were charged under the International Emergency Economic Powers Act. Some other techniques include hiring actual Americans to take their place at job interviews and using a series of fraudulent web domains and websites to lure prospective employers into giving them an opportunity.

The State Department also offered a reward of up to $5 million for information about the conspirators who remain at large to date.

“The government of North Korea has trained and deployed thousands of IT workers to perpetrate this same scheme against U.S. companies every day,” said Ashley Johnson, St. Louis-based FBI special agent. “The government of North Korea has trained and deployed thousands of IT workers to perpetrate this same scheme against U.S. companies every day,” she continued.

How AI Tools Are Helping Job Fraud

Artificial intelligence has taken employment fraud to new levels. Now, fictitious workers can do everything from creating fake identities to even credentials. For example, deepfake technology can create realistic video and audio recordings. It has sometimes even been used to deepfake company C-suite executives to facilitate financial transfers. Even cheap image generators can produce counterfeit documents, including certifications.

What Are the Reasons “Fake Workers” Do This?

“Fake workers” do not simply use companies for financial gain. Now, all stakes are on the table, including unauthorized access to sensitive information through data breaches, where imposters can tap into confidential databases to steal intellectual property/data, reroute payroll deposits, and monitor a company’s activities for actual competitors. They can also infiltrate companies to install malware and conduct phishing attacks, passing on information to the dark web.

What Employers Can Do to Detect Fake Workers

With the rise of deepfaking artificial intelligence in job opportunities, employers have taken a step back and doubled down on security efforts such as multi-step identity verification and AI video interviewing auditing tools.

Multi-Step Identity Verification

One of the most popular ways to detect employee fraud is by conducting multi-step identity verification using biometric facial recognition tools to ensure that a candidate is who they claim to be during a live video session. These tools compare users’ facial data against government-issued photo IDs to ensure they’re not overseas scammers. Sometimes, detecting pre-recorded clips is challenging, making this technology very useful.

Another area where multi-step identity verification proves effective is real-time document capture. Many job interviews do not require applicants to use a phone or webcam to show their documents in real-time, instead accepting uploaded files. Uploaded files can always be doctored using simple editing tools, whereas real-time verification ensures the document is genuine.

Lastly, government databases can be used to cross-verify identity through the federal system E-Verify, which uses SSA and DHS databases to ensure a candidate meets eligibility requirements. This is available at the federal level, not necessarily in the private sector, but efforts are underway to evangelize this technology for improved security.

AI Video Interviewing Auditing Tools

AI video interviewing auditing tools aim to catch deepfake interviews. Deepfake interviews occur when applicants use fake voice overlays and synthetic faces to impersonate someone, appearing legitimate. These tools can analyze facial expressions in real-time (e.g., consistency with eye contact) and detect pixel distortion or erratic, static backgrounds that do not correspond to reality. Sometimes, it’s tough for humans to catch the fakes, which is why trained detection software is essential.

Employers are encouraged to avoid text-based interviews in favor of live, unscripted video interviews instead of predetermined questions. Candidates may also be asked to hold up government-issued photo IDs or handwritten notes to prove they are real.

In short, generative AI has made it harder for employers to identify fake workers. Fortunately, there is no shortage of protocols that can assist with this effort—assuming companies have the budget and the resources to devote to them.

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