AI Scams Are Getting Smarter: How to Protect Your Money
AI has made scams more realistic, faster, and harder to spot
Urgency and pressure are major warning signs of fraud
Credit cards usually offer better protection than debit or wire transfers
Slowing down and verifying information can save you thousands
In a recent episode of the Moolala: Money Made Simple podcast, host Bruce Sellery discusses AI’s impact on fraud in the world of personal finance with Larry Zelvin, Head of Security Advisory at BMO Financial Group. Their conversation explores how AI is being used both to stop fraud and commit it, and what everyday people can do to protect themselves. The following blog is based on insights from that conversation: AI-Driven Scams Explained and How to Avoid Them.
While artificial intelligence (AI) is making our lives easier, with faster access to information and better customer service, it’s also making fraud more convincing, more personal, and harder to detect.
Gone are the days when we could spot a scam almost immediately. Perhaps a mysterious “Nigerian prince” emailing you out of nowhere, asking for help to move millions of dollars. For a small fee, of course, and then you’ll get your reward, promise. Or you receive a clumsy request via email or text to pay off a debt you’ve never heard of with Bitcoin or gift cards.
Thanks to AI, the sophistication of scams has gotten a major upgrade. Nowadays, voices can be cloned, emails can sound polished and professional, and fake websites can look so real that they fool almost anyone.
This growing risk was the focus of an episode of the Moolala: Money Made Simple podcast, hosted by Bruce Sellery. His guest was Larry Zelvin, Head of Security Advisory at BMO Financial Group, who highlighted just how prevalent the risk of financial scams has become in the age of AI.
But the goal here isn’t to scare you. It’s to help and remind everyone that it’s important to slow down, stay alert, and make safer choices, especially when it comes to decisions that impact your money.
How AI Has Changed the Fraud Game
AI has essentially “lowered the bar” for scammers. In the past, fraud often required some technical skills or inside knowledge. Today, AI tools can write convincing phishing emails in seconds, create fake investment offers, or even imitate a real person’s voice.
As Larry Zelvin explained on Moolala, scammers don’t need to be experts anymore. They can use AI to do the hard work for them:
“You don't need a lot of technical skills. There's plenty of applications out there that if you say, ‘Hey, I want to send a very sophisticated phishing email and I need the addresses,’ it'll build it all forward.”
That means more scams, sent faster, to more people.
Fraud is also showing up in more places:
Fake emails and text messages
Deepfake videos and voice calls
Phony investment flyers sent by mail
Messages that look like they’re from the government or a trusted company
The message is clear: scams are no longer obvious or poorly written. They’re designed to look real and to catch you off guard.
One term that came up in the podcast was “digital pickpocketing.” It sounds dramatic, but it’s very real.
In crowded places like buses, trains, or events, criminals can sometimes access phones wirelessly. They don’t need to steal your phone physically. Just being close enough can give them access to your personal information on your phone if your device isn’t secured.
Having your device auto-lock within a relatively short period of time, like after 30 seconds, can help safeguard against digital pickpocketing. Also, make sure that your lock screen doesn’t display sensitive information.
This is a reminder that digital fraud doesn’t just happen online. It can happen anywhere, especially when we’re distracted or in a rush.
What Banks Can Do and What They Can’t
Financial institutions are investing heavily in fraud detection. AI helps banks spot unusual behaviour, flag suspicious transactions, and even identify when someone is pretending to be you on a phone call.
You may have seen this in action:
A text asking if a charge was really you
A warning that a call might be spam
A card being frozen while you’re travelling
These systems are designed to protect you, but they aren’t perfect. And they can’t stop everything.
For example, Larry’s mother-in-law has dementia, and she has been repeatedly targeted by scammers who use her empathetic nature against her:
“My wife has had to change her bank accounts three times in seven months because she falls prey to helping children. She's into church charities. And none of these things are real. They're all fraud. But unfortunately, because of her cognitive abilities, she doesn't have the ability to detect. And that's outside of the bank's control system.”
As Larry shared during the podcast, individuals are often the last line of defence. Banks can monitor patterns, but they can’t always protect someone from responding to a convincing message or sending money willingly to a scammer.
How to Protect Yourself Against Bank Impersonation Scams
Bank impersonation scams are when someone contacts you via phone, email, or text, claiming to be a representative from your bank. They often say there has been suspicious activity on your account and ask you to confirm your personal information, like your name, address, account number, or even answers to your security questions, before eventually requesting your PIN.
Remember: in Canada, legitimate banks will never contact you out of the blue and ask for your PIN, passwords, or full security information.
If you are contacted by someone claiming to be your bank and they ask for your PIN, do not share it, and do not enter it on your phone if they called you. Hang up immediately, or ignore the message if it’s an email or text. Then, contact your bank directly using a verified phone number from their official website or on the back of your bank card to confirm whether the request is legitimate.
The Canadian Anti-Fraud Centre is a valuable resource you should check from time to time to stay informed about recent scams and fraud, how to protect yourself and your loved ones from them, and how to report fraudulent activity.
Why Urgency Is a Major Red Flag
One of the biggest warning signs of fraud is pressure.
Scammers want you to act fast so you don’t stop to think. They may say:
“Your account will be closed today.”
“You owe money right now.”
“These tickets are almost gone.”
“This offer expires in minutes.”
Big events make this worse. As Larry explains, “World Cup is coming up. You have the Olympics, you have all these concerts. Be careful of those emotional events that drive you to click on things and move your money faster.”
Concerts, major sports tournaments, travel deals, and holidays are all popular hooks. Emotional moments make people more likely to click, pay, or share information quickly, in fear of missing out on the chance to attend.
Slowing down is one of the simplest and most powerful tools you have. When you consider the risk of potentially being scammed out of hundreds, if not thousands of dollars, taking some time to reflect and assess can be one of the smartest financial decisions you make.
Simple Ways to Protect Yourself From AI Scams
Even though scams are more advanced, many protective steps are still surprisingly basic. Larry reminds us that while we have to protect ourselves against new threats enhanced by AI, we can’t forget those tried and tested rules that have protected us against digital scams in the past:
“We gotta remember the old and the new. The old is still a problem, so don't click on those links, don't open those attachments. All those things are still working. Some people ask me, ‘Hey Larry, are you worried about the quantum threat?’ I am, but I'm even more worried about people still clicking on links and giving away their information.”
Here are some other practical tips shared on Moolala, and reinforced by what our Credit Counsellors see every day:
Be cautious with payment methods. If someone won’t accept credit cards and only wants debit, wire transfers, or crypto, that’s a red flag. Credit cards offer more protection if something goes wrong.
Watch out for “too good to be true” deals. Deep discounts and guaranteed returns are common scam tactics.
Think twice before scanning QR codes. A QR code is just a link you can’t easily see, so the same rules apply. Pause before scanning, especially in public places. Only scan QR codes from trusted sources.
Look up companies on your own. Don’t trust links in messages. Search for the company name yourself and check reviews or the Better Business Bureau.
Question unexpected messages. Even if a text or email looks real, verify it using official contact information.
There aren’t many tools you can download that will fully protect you. Awareness and skepticism are still your best defence.
The Inconvenience vs. the Cost of Fraud
Fraud protection can be annoying. A frozen card while travelling. Extra steps to log in. Two-factor authentication that doesn’t work because your phone doesn't work in that country.
As Bruce shared on the podcast, these situations can feel frustrating in the moment. But the alternative (which can mean thousands of dollars lost to fraud) is usually worse.
This is where balance comes in. While no system is perfect, a bit of inconvenience can be a sign that safeguards are working.
Staying Safe Without Living in Fear
The goal isn’t to stop living your life or to distrust everything. It’s to be informed, alert, and thoughtful.
AI isn’t going away. It will keep improving on both sides, the good and the bad. Staying safe means combining technology with human judgment. Slow down, ask questions, and always double-check when something feels off.
And if fraud or financial stress has already taken a toll, support matters.
Fraud can feel personal, stressful, and even embarrassing, but the truth is it’s happening to more people every day. If you’re worried about your finances, debt, or the impact of a scam, you don’t have to figure it out alone.
You can book a free one-on-one credit counselling session with one of our certified Credit Counsellors by calling 1 (800) 267-2272. They can help you understand your options and regain confidence in your financial decisions.
And if you’re not quite ready to speak to someone, you can always ask any debt-related questions to our AI-powered debt agent, Mariposa. It can provide you with quick answers to questions you might have regarding debt and your financial situation, 24 hours a day, 7 days a week. It’s just like speaking with one of our Credit Counsellors.
Navigating your personal finances doesn’t have to be scary or intimidating, even now with the addition of AI. Support is available to help you see life more clearly, with confidence and hope for your financial future.
Frequently Asked Questions
How can I tell if a message is an AI scam?
Look for urgency, requests for immediate payment, or pressure to act quickly. Even polished language or familiar names can be fake.
Are QR codes always unsafe?
No, but they should be treated with caution. Only scan QR codes from trusted sources and pause before entering any personal information.
How can I tell if a message is an AI scam?
It’s safer to go directly to the company’s website instead of clicking links in emails or texts.
What should I do if I’ve already been scammed?
Contact your bank or credit card company right away. Then consider speaking with a non-profit credit counselling agency for guidance and next steps.
Adriana Molina • Author
Adriana Molina is a communications professional with over 15 years of experience working in the non-profit credit counselling industry, helping those bogged down by debt see life more clearly.
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