How Cryptocurrency Scammers Are Adopting New AI Technology

Author: Eric Johansson, dlnews Compiler: Shan Ouba, Golden Finance

• Butchery scammers are using new artificial intelligence tools to trick their victims.
• Prosecutors warn of growing number of new cases around the world. *Cryptocurrency scams will cost victims more than $2.5 billion in 2022.

In the months since OpenAI launched ChatGPT and upended the startup ecosystem, the technology has been branded a threat to journalism, screenwriting and national security. So it’s no surprise that fraudsters and cybercriminals are exploiting large language models to steal cryptocurrency from their victims. Still, this happened to him when a guy using Tandem, a language-sharing app that doubles as a dating platform, was having an online conversation. Another talker quickly convinced him to move the chat to WhatsApp.

Whatever the intended end result, the con was botched by a lengthy text that revealed "as a language model of 'me', I don't have human-like feelings or emotions," basically using advanced Chatbots, if not ChatGPT, bear a striking resemblance to it. Shocked, the would-be victim contacted cybersecurity firm Sophos, which confirmed fears of criminals taking advantage of the new technology had become a reality.

"We can now say that, at least in the case of butchery scams, this is indeed happening," Sean Gallagher, principal threat researcher at Sophos, said in a report highlighting the case.

Butchery is a scam in which scammers try to lure victims into investing in a cryptocurrency platform for a period of time, promising high returns before cashing out, thereby encouraging victims to commit their funds, which ultimately results in them suffering losses and shame. The FBI estimates that such cryptocurrency scams have cost victims more than $2.5 billion by 2022.

However, the use of ChatGPT and similar tools will allow criminals to scale up "in a way worse than we've seen in the past," California Attorney Erin West said. She is famous for successfully recovering millions of stolen cryptocurrencies. This technology will allow criminals to better tailor conversations with victims, overcome language barriers, reach more people and cause more damage. "The addition of ChatGPT makes this even more dangerous," she added. The sober warning follows reports of cybercriminals using similar tools to quickly write malware.

Not a question of if, but a question of when

Security firms and law enforcement are uneasy about this development, but none of the people we spoke to were surprised. "It's not a question of if, it's a question of when," Bobby Cornwell, vice president of strategic partner enablement and integration at cybersecurity firm SonicWall, told DL News.

These stories have been brewing since OpenAI launched ChatGPT last November. These advanced chatbots are trained with vast amounts of data. They leverage large datasets including books, codes, websites and articles, are able to write complex codes and even carry on conversations based on user prompts. This is a breakthrough for OpenAI. As of January, it had about 100 million monthly active users, making it one of the fastest-growing apps in history. People have started using it for everything from writing online dating profiles to horror stories, and even generating video scripts and debugging code. Tech giants including Google and Meta are also accelerating the development of their own conversational AI tools, such as Bard and LLaMA.

In July, Tesla CEO Elon Musk launched a new company called x.AI with the aim of creating a version of ChatGPT that is less “awake” than the OpenAI version. In the first half of 2023, AI companies raised more than $25 billion from investors, according to Crunchbase.

The dark side of ChatGPT

Instead of celebrating the victory, OpenAI CEO Sam Altman went on a world tour warning of the dangers of unfettered artificial intelligence. He has testified before the U.S. Congress and told reporters he was losing sleep over fears that OpenAI had unleashed its proverbial AI genie "to do some really bad things." Whether his remarks were motivated by genuine fear or part of an elaborate PR strategy remains uncertain.

Whatever the motivation behind Altman's remarks, digital mobs are already using ChatGPT or similar tools to support their plans. Cybercriminals even claim to have created their own version of ChatGPT, immune to the security measures installed by OpenAI. They advertised them on the dark web as tools to enhance phishing attacks and write malware, Wired reported in early August. The cybercriminal and threat actor community is tech-savvy and proactive, and tends to be early adopters of new technology trends as they see the benefits and improvements in how their tools, techniques, and practices evolve.

So it’s no surprise that threat actors are adopting generative AI, as they can reap the same productivity gains and potentially improve their ability to hide, conduct reconnaissance, build malicious code, deceive people and security software, and more. These developments have cybersecurity experts and law enforcement agencies scrambling to respond to the threat.

Cybersecurity firms must "build more intelligence into our systems to look for AI-generated content," Cornwell said, adding that developing such countermeasures will take time. , and while she and other law enforcement can warn of these threats, the criminal groups behind the killing spree will be difficult to take down even before harnessing artificial intelligence.

According to the global anti-fraud group, many criminal networks operate from places like Cambodia, Laos and Myanmar. Their crimes have raked in billions of dollars, allowing them to pay local law enforcement and avoid international sanctions. It is very difficult to fight against such a large and rich criminal group.

OpenAI did not respond to our request for comment.