AI-Driven Scams Spike as Holiday Shopping Begins

As the holiday shopping season kicks off, cybersecurity experts are warning that AI-powered scams are becoming more widespread and harder for consumers to detect. Larry Zelvin, head of BMO Financial Group’s financial crimes unit, said fraud activity surges during the festive period as both retailers and shoppers move online in large numbers.

Zelvin noted that scammers are now relying heavily on AI to create convincing fake retailer websites, phishing emails, and even deepfake videos that impersonate trusted brands or influencers. These tactics are designed to trick shoppers into sharing personal or financial information without realizing it.

Another rising threat involves QR-code scams. Fraudsters embed malicious links into codes placed on posters, packages, or deceptive advertisements. Because most people don’t examine URLs after scanning, they unknowingly land on phishing sites created to steal data.

Digital pickpocketing is also increasing. Criminals use contactless payment skimmers to capture data from smartphones in crowded areas like malls and public transit. Zelvin warned that “where thieves once took your wallet, now they steal what’s inside your phone.”

The scale of the problem is growing quickly. Last year, 2.6% of online transactions in Canada between Thanksgiving and Cyber Monday were flagged as fraudulent, a 51% jump from the previous year. Older consumers are particularly targeted due to their reliance on mobile payments.

Despite rising risks, Canadians continue to shop online. A Boston Consulting Group report shows 77% plan to participate in Black Friday and Cyber Monday deals, though average spending is expected to be more cautious.

To stay safe, Zelvin advises avoiding links in emails or texts, visiting retailer sites directly, checking for HTTPS security, and using credit cards—which offer stronger fraud protections—over debit, gift cards, or instant payment apps.