#28: Fake Students, Global Scam Networks, and AI Shopping Fraud

Fraud is scaling in every direction: fake identities clogging education systems, organized cybercrime expanding across borders, and AI-generated scams blending into everyday shopping. It’s another reminder that fraud isn’t standing still, and neither can we. Let’s get into it.

NATE'S TAKE - APRIL 22, 2025

Top Three This Week

1. Bot Students Are Flooding Community Colleges And Stealing Millions
2. Global Scam Networks Are Growing Fast—and Getting More Organized
3. AI-Generated Shopping Scams Are Getting Harder to Catch

1. Bot Students Are Flooding Community Colleges And Stealing Millions

Fraudsters are targeting education systems now too. A new report reveals that 25 percent of community college applicants in California were bots last year, with fake students stealing over $11 million in financial aid during 2024—more than double the amount stolen the year before.

Bots are moving beyond simple application fraud, navigating enrollment and financial aid systems designed for real humans. Colleges are now facing thousands of fake applications at a time, straining resources and delaying services for legitimate students.

For fraud teams, the pattern is familiar: low-cost, high-volume automation overwhelming outdated defenses. If identity, intent, and early journey behavior aren’t being scrutinized, fraudsters will keep scaling faster than detection can catch up.

2. Global Scam Networks Are Growing Fast—and Getting More Organized

Photo: DarkReading

Cyber scam operations, once localized to Southeast Asia, are scaling internationally, operating more like multinational businesses than disorganized gangs.

According to findings from the United Nations Office on Drugs and Crime (UNODC), scam networks are now worth billions of dollars annually, running industrialized fraud operations out of compounds where trafficked victims are forced to work under brutal conditions.

The UN report points to:

• Human trafficking and forced labor as critical components of scam operations, particularly in Cambodia, Laos, and Myanmar.
• Pig butchering scams, investment frauds, and crypto scams as their primary revenue streams.
• Global targeting, with scams often initiated through social media platforms, dating apps, and online games.

Even when enforcement agencies crack down in one country, operations often relocate quickly to continue business elsewhere, highlighting the need for truly international disruption efforts.

For fraud fighters: fraud networks today are multinational, organized, and far more sophisticated than the old models assumed. Any platform, no matter the size, can be a target—or a tool—in the next attack cycle.

3. AI-Generated Shopping Scams Are Getting Harder to Catch

AI-generated shopping scams are surging, using fake websites, AI-created reviews, and deepfake customer service chats to fool consumers into handing over money and personal information.

Professional-looking storefronts can now be spun up by AI in minutes, complete with realistic but fake testimonials and support interactions. Scams that once took hours or days to build now launch instantly—and disappear just as fast.

For consumers, the advice is the same: verify websites, double-check offers, and stay skeptical of deals that seem too good to be true.

For fraud teams, the challenge is bigger. Fraudsters are using AI to scale faster and appear more legitimate than ever before, making it harder for basic scam detection models to keep up. AI is no longer a theoretical risk—it’s a force multiplier for fraud.

Commerce is blurring faster than platforms realize. Defenses have to move faster too.