Global State of Document Fraud Report: Trends, Impacts and Countermeasure Strategies

Executive Summary

Document fraud represents a rapidly expanding global threat, whose scale is considerably amplified by the advent of generative artificial intelligence. This report analyzes the current state of this phenomenon, its key figures, fraud typologies, financial and societal impacts, as well as technological, regulatory and collaborative solutions implemented to combat it. The analysis highlights the rapid industrialization of fraud, the urgent need for a coordinated multi-stakeholder response, and the crucial importance of continuous innovation to counter an ever-evolving threat. The consequences of this fraud extend beyond direct financial losses, affecting public trust, institutional stability and the fluidity of digital transactions.

1. Introduction: Understanding Document Fraud

1.1. Definition and Scope of the Phenomenon

Document fraud is an illegal act that manifests itself through the creation, fraudulent modification or abusive use of documents in order to obtain an undue advantage. France's Ministry of Economy and Finance defines this fraud as including, but not limited to, false identity documents, false civil status documents, false proof of residence, and false proof of income.

Interpol proposes a more detailed classification, distinguishing several categories of document fraud:

- Counterfeiting involves the unauthorized reproduction of an authentic document, often carried out with such sophistication that an "official/governmental caliber printing press" is necessary, making these fake documents extremely difficult to recognize.

• Falsification consists of altering an authentic document. This may include modifications of dates on medical certificates, grades on school transcripts, or amounts on invoices. A common technique is replacing the identity photo on a legitimate document.
• Pseudo-document refers to a document that is not officially recognized by an authority.
• Fraudulent obtaining of authentic documents, also called "intellectual fraud" or "true-false", where legitimate documents are acquired through deception, for example by using false supporting documents to obtain an authentic identity card. These documents are particularly insidious because they are "totally valid" to the naked eye or under special lights, shifting the detection challenge from document materiality to identity verification and user intent.
• Fraudulent use of authentic documents by an impostor, where a person uses another person's legitimate identity document.
• Creation of fake documents (fantasy/fictitious), which are entirely invented documents, with no reference to an existing model, but designed to appear convincing.
• Stolen blank documents, which are authentic documents stolen before being personalized, then fraudulently filled out.

The complexity of fraud no longer lies only in the manufacture of fake documents, but also in the fraudulent obtaining and use of authentic documents. This means that a document may appear perfectly legitimate, but the underlying identity or the acquisition process was fraudulent. This evolution shifts the need from purely visual or physical inspection to more thorough checks, identity verifications and background processes.

1.2. Global Context and Urgency of the Threat

Document fraud is a "very relevant and pressing" crisis on a global scale. It is now considered the third largest criminal industry worldwide. This phenomenon is described as an "omnipresent, ambient and endemic scourge", affecting all social sectors and all areas of activity. The example of Mali illustrates this omnipresence, where corruption and document fraud are widespread and, in some cases, perpetrated with the complicity of authorities, making detection and prevention all the more difficult.

The qualification of document fraud as the "third largest criminal industry worldwide" and its "endemic" nature elevate the problem beyond a simple financial loss for companies. This makes it a systemic threat to the global economy and institutional stability. If document fraud is a major criminal industry on a global scale, this implies the existence of sophisticated networks, the mobilization of significant resources and a high degree of organization. This complexity and scale have direct repercussions on the nature and scale of countermeasures necessary to combat it.

2. Current State and Key Figures of Document Fraud

2.1. Global and Regional Economic Scale

Document fraud has a colossal financial impact, both globally and regionally. On a global scale, identity fraud costs companies an average of 7 million USD per year. For large organizations, costs increase considerably: those with more than 5,000 employees suffer an average loss of 13 million USD per year, and 20% of companies with more than 10,000 employees record direct and indirect costs exceeding 50 million USD annually.

In France, the annual cost of document fraud to the national economy amounts to more than 65 billion euros, representing 2.5% of the country's Gross Domestic Product (GDP). This amount is sometimes referred to as a "hidden tax". In 2024, France detected 20 billion euros in fraud, a historic figure, and aims to double it by 2029.

The financial impact is felt significantly in various sectors:

- Insurance: Annual losses due to fraud amount to 2.5 billion euros.

• Banking: The banking sector records more than 1 billion euros in losses each year. An alarming 8% of identity documents presented for opening bank accounts are fake.
• Real Estate: Between 5 and 10% of rental files contain falsified documents.
• Tax Fraud: Estimates reach 60 billion euros per year.
• Health: Losses due to fraud in this sector amount to 2.7 billion euros.

The disparity between average costs for companies (7 million USD) and the national cost for France (65 billion EUR) indicates that document fraud is not limited to losses suffered by companies. It has a massive macro-economic impact on public finances, particularly through fiscal, social and public aid fraud. This situation fully justifies a coordinated state response and significant public investment in combating this phenomenon.

2.2. Increasing Trends and Role of Generative AI

Document fraud is experiencing exponential growth, largely fueled by the advent and democratization of generative artificial intelligence technologies. The global identity fraud rate worldwide has more than doubled in three years, rising from 1.10% in 2021 to 2.50% in 2024. More than two-thirds (69%) of global organizations have reported an increase in identity fraud attempts over the past two years.

Generative AI is a major catalyst for this escalation, industrializing document fraud at unprecedented speed. The number of digital frauds has jumped 244% in just one year. Over a longer period, digital frauds have experienced a staggering 1600% increase since 2021.

Deepfakes are at the heart of this new wave of crime. A deepfake attack is reported every 5 minutes in 2024. AI-based attacks, and particularly deepfakes, constitute the main identity fraud trend in 2024. These technologies make it possible to manipulate facial images on identity documents, making detection extremely difficult, even for automated facial recognition systems.

The effectiveness of these new methods is confirmed by the high success rate of fraud. In the banking sector, 42.5% of fraud is now generated by AI, with a success rate of 29%. The overall success rate of document fraud reaches 73%.

The explosion of deepfakes and AI-generated fraud represents not just a quantitative increase, but a fundamental qualitative change in the nature of the threat. This makes traditional detection methods obsolete and requires a massive reorientation towards cutting-edge technologies capable of countering falsifications that are almost undetectable to the naked eye. The high success rate of fraud (73%) confirms the effectiveness of these new methods, implying that simple human vigilance or basic digital verifications are no longer sufficient. This pushes the industry towards advanced AI-based solutions, capable of detecting subtle anomalies generated by AI. An additional challenge lies in managing "false positives", where overly aggressive systems could reject legitimate users, highlighting the need to find a balance between security and user experience.

2.3. Most Targeted Documents and Most Vulnerable Sectors

Document fraud is a horizontal threat that exploits any value chain requiring proof of identity or legitimacy, emphasizing the universality of risk. Fraudsters target a wide variety of documents, depending on their value and the benefits they can provide.

Most targeted documents:

- Identity and travel documents: The identity card is the most commonly used document in daily life and is therefore a preferred target. Passports, essential for travel, are used for illegal immigration, terrorism and human trafficking. In 2024, 10% of French passports were targeted by document fraud. Driver's licenses are also falsified for vehicle rental, transportation work or to commit traffic violations.

• Financial and administrative documents: Bank Identity Statements (RIB), pay slips, bank statements and proof of residence are frequently falsified for loan applications, rentals or fund embezzlement.
• Other documents: The Vitale Card is targeted for fraudulent medical consultations or undue reimbursements. Diplomas are falsified to obtain jobs or promotions. Residence permits and visas are modified for illegal employment or housing rental.

Most vulnerable sectors:

- Finance, Banking & Insurance: These sectors are most impacted by identity fraud. Banking records more than 1 billion euros in annual losses, and 42.5% of banking fraud is now generated by AI.

• Real Estate: Between 5 and 10% of rental files contain falsified documents.
• Public Services and Social Aid: The use of false documents to justify public aid requests is a common practice.
• Cryptocurrencies: This sector experienced a fraud attempt rate of 9.5% in 2024, up 50% from 2023.
• Dating and Online Media: These platforms are among the five sectors most vulnerable to identity fraud.
• Health: Fraud by healthcare professionals, involving fictitious acts or false prescriptions, is also a problem.

The diversity of targeted documents and affected sectors, from identity documents to public services, through finance and cryptocurrencies, demonstrates that fraudsters are opportunistic and exploit any weakness where a document can give access to a service or advantage. This implies that solutions cannot be compartmentalized by document type or sector, but must adopt a holistic and intersectoral approach.

3. Typologies and Methods of Document Fraud

3.1. Falsification, Counterfeiting and Creation of Fake Documents

Fraudsters employ various techniques to manipulate documents, ranging from subtle alteration to complete creation of fakes.

- Falsification consists of modifying an authentic document. These alterations can be minor, such as changing a date on a medical certificate or a grade on a transcript, or more complex, such as modifying amounts on invoices. A frequent method is replacing the identity photo on a legitimate document with that of the fraudster or their client.

• Counterfeiting involves unauthorized reproduction of an authentic document. High-quality counterfeits are often produced with sophisticated printing equipment, of "official or governmental caliber", making them extremely difficult to distinguish from originals.
• Creation of fake documents, or fantasy/fictitious documents, refers to the manufacture of entirely new documents that have no real equivalent. These documents, such as fake pay slips, fake bank statements or fake school certificates, are designed to appear very credible and deceive even vigilant professionals in order to obtain benefits.
• Stolen blank documents are authentic documents that have been stolen before being personalized, then fraudulently filled out by criminals.

The growing sophistication of fraud methods, particularly "official caliber" counterfeiting and the creation of convincing "fantasy" documents, makes manual document analysis insufficient. Documents are increasingly credible and can mislead even the most experienced professionals. This reality underscores the urgency of adopting advanced detection technologies.

3.2. Identity Theft and Fraudulent Obtaining of Authentic Documents

Beyond material falsification, document fraud extends to more complex forms:

- Identity theft occurs when a fraudster uses another person's authentic identification documents, often lost or stolen. In this case, the document itself is legitimate, but the person presenting it is not the rightful holder.

• Fraudulent obtaining of authentic documents, sometimes called "true-false", is a particularly insidious technique. It involves using falsified or counterfeit documents (for example, a fake proof of residence or a fake birth certificate) to obtain an authentic and legally valid document, such as a national identity card. What makes this fraud so difficult to detect is that the final document is "totally valid", even under special lights, and can pass checks if verification only focuses on the document itself.

The prevalence of "true-false" documents and identity theft represents a major challenge for traditional verification systems. The fraud no longer lies in the materiality of the document, but in the legitimacy of the associated identity or the acquisition process. This requires rigorous cross-checking with external databases, as well as the use of "face matching" technologies and liveness detection to ensure that the person presenting the document is indeed its legitimate holder and that it is not a manipulated image or video.

3.3. The Industrialization of Fraud by Emerging Technologies (Deepfakes)

Generative artificial intelligence has become a major catalyst for fraud. It allows cybercriminals to create fake documents and falsify biometric data with unprecedented ease and sophistication, thus bypassing existing control systems.

Deepfakes, in particular, are a growing threat. They are used to manipulate facial images on identity documents, making detection extremely difficult, even for automated facial recognition systems. These technologies make it possible to "morph" faces on passports, increasing the chances that the falsified photo will pass identity checks, including those using facial recognition systems. The phenomenon of "Deepfake as a service" makes these cutting-edge techniques accessible to a wider audience, reducing the barrier to entry for fraudsters.

The speed with which AI technologies, particularly deepfakes, are adopted and industrialized by fraudsters creates a constant gap with detection capabilities. This situation requires continuous technological monitoring and proactive investment in research and development of countermeasures. Fraudsters adapt their techniques at an alarming rate, which means that defense solutions cannot remain static. It is imperative to invest in continuous R&D and agile deployment of new solutions to maintain the effectiveness of anti-fraud systems.

4. Impacts of Document Fraud

4.1. Financial and Operational Consequences for Organizations

Document fraud leads to significant direct financial consequences for companies, such as bad debts, fund embezzlement, salary payments to fake employees, unrecovered loans and fraudulent orders. Beyond these direct losses, organizations suffer considerable hidden costs. Fraud investigations, for example, divert significant resources that could be allocated to the company's main activities.

Operationally, document fraud can seriously disrupt business operations. It can lead to deteriorating relationships with suppliers whose identity has been usurped, which can in turn disrupt the supply chain. For certain rare goods, the loss of a critical supplier can seriously affect the entire chain, thus impacting the company's major processes.

The impact of document fraud far exceeds direct financial losses, leading to erosion of trust, operational overload and strategic disruption. This damage can threaten the long-term viability of businesses and institutions, as it affects partner confidence, internal efficiency and the ability to maintain smooth operations.

4.2. Legal and Reputational Risks

Document fraud exposes organizations to serious legal and reputational risks. Concluding a contract based on a modified, falsified or false document can lead to contract invalidity and lengthy and costly legal proceedings. Companies also risk having their liability called into question in the event of damage caused to a third party.

Non-compliance with anti-fraud regulations can lead to significant sanctions, including financial ones, or even marketing bans. Document fraud can also generate regulatory compliance and corporate governance problems, subjecting companies to more rigorous controls by authorities.

In addition to legal repercussions, fraud affects the reliability and brand image of the company vis-à-vis its customers and partners. Damage to reputation can have lasting consequences on consumer confidence and the ability to attract new customers or partners.

The convergence of these financial, operational, legal and reputational risks makes the fight against document fraud a strategic imperative of corporate governance. Non-compliance and security breaches can lead to cascading consequences much more serious than direct losses, including severe criminal prosecution for "false public writing" and irreversible loss of trust. Governments, like France, are also strengthening criminal sanctions and cooperation between administrations to fight more effectively against these frauds.

4.3. Societal Impact and on Public Trust

Document fraud has profound repercussions on the social fabric and public trust. A worrying phenomenon is the normalization of fraud within the population: 10.8% of French people admit to having already used a fake document, and more than 20% of those under 35 have falsified documents for banking procedures.

This trivialization is often motivated by socio-economic factors. Economic precariousness is cited by 38% of fraudsters as a main motivation, followed by the feeling of impunity (33%) and the feeling of social injustice (25%).

The widespread use of deepfakes and other sophisticated falsification techniques undermines trust in authorities and official information. This can lead to societal confusion about reliable information sources, threatening citizens' ability to distinguish truth from falsehood in an increasingly complex digital environment.