New York Warns of AI-Driven Fake Crypto Scams as Losses Top $8 Billion

New York’s Division of Consumer Protection has issued a warning that AI‑generated deepfakes and fake cryptocurrency schemes are driving a sharp increase in investment fraud. In 2025, more than 144,000 consumers reported losses that totalled over $8 billion, up 38% from 2024.

Investment Scam Losses Surge

The Federal Trade Commission (FTC) identified investment scams as the costliest fraud category in 2025. The median loss per victim was $10,560. Both the state alert and an FTC consumer alert in April placed total losses near $8 billion.

AI Deepfakes Amplify Deception

Fraudsters are using artificial intelligence to clone voices, fabricate video endorsements, and produce polished advertisements that appear to come from celebrities or financial experts. New York Attorney General Letitia James highlighted schemes that feature deepfake endorsements, pump‑and‑dump operations, and fake trading platforms across social media channels.

Fake Crypto Projects Mimic Real Firms

Scammers create entire counterfeit online ecosystems – including fake trading sites, fabricated news articles, and chatbots posing as support staff – to lure investors. Victims often see professional‑looking applications showing fabricated balances and returns, sometimes allowing small withdrawals to build trust before demanding larger deposits.

Consumer Guidance

Officials advise verifying the identity of any promoter, confirming the legitimacy of the company and investment, and never paying additional fees before funds are released. Warning signs include guaranteed high returns, unsolicited offers, high‑pressure tactics, and lack of clear documentation.

Reporting Fraud

Anyone suspecting a scam should stop payments immediately and report the incident to the FTC, the FBI’s Internet Crime Complaint Center, the SEC, or the New York Attorney General’s office.