{"slug": "gop-financial-services-report-cites-ai-as-both-fraud-accelerator-and-preventer", "title": "GOP Financial Services report cites AI as both fraud accelerator and preventer", "summary": "A House Financial Services Committee staff report released Wednesday by top Republicans cites artificial intelligence as both a key driver of financial fraud and a critical tool for prevention, noting that U.S. consumers reported over $15.9 billion in fraud losses in 2025 according to FTC data. The report, compiled after a year-long investigation, warns that AI enables criminals to generate personalized scams, clone voices, and create deepfake videos, but argues that public and private entities must deploy the same tools to counter these threats, citing CMS's use of AI to save more than $2 billion in improper payments.", "body_md": "# GOP Financial Services report cites AI as both fraud accelerator and preventer\n\n## With AI playing a more prominent role in the scammer’s playbook, the report says “the counter to this is ensuring that those empowered to prevent and respond to fraud and scams — namely public and private sector entities — deploy the same tools.”\n\nTop Republicans on the House Financial Services Committee released a staff report on Wednesday outlining policy approaches for combating financial fraud and scams, with the document citing artificial intelligence as a key driver of financial fraud and also an important tool for countering more sophisticated criminal schemes.\n\nThe [report](https://financialservices.house.gov/uploadedfiles/2026-07-22_-_fsc_report_-_fighting_back.pdf) was compiled following a year-long investigation conducted by the panel, which included holding a series of fraud-focused hearings. The final document appears to have been released without any input from the committee’s Democrats.\n\nThe staff report’s release comes amid a broader governmentwide effort to crack down on waste, fraud and abuse. President Donald Trump [launched](https://www.nextgov.com/digital-government/2026/03/trumps-anti-fraud-task-force-poised-scrutinize-benefits-programs/412219/) a self-described “war on fraud” during his second administration, with the White House launching an anti-fraud task force earlier this year to scrutinize scams targeting federally-funded benefits programs.\n\nRep. French Hill, R-Ark., the chair of the House panel, said in a [statement](https://financialservices.house.gov/news/documentsingle.aspx?DocumentID=411203) that “as fraudsters become more sophisticated, we must ensure law enforcement, regulators, and financial institutions have the tools they need to stay ahead of these evolving threats.”\n\nData [released](https://public.tableau.com/app/profile/federal.trade.commission/viz/FraudReports/FraudFacts) by the Federal Trade Commission at the end of 2025 found that U.S. consumers reported over $15.9 billion in fraud losses over the course of that year. The panel’s document, which looked at financial scams affecting Americans, warned that “AI is rapidly becoming one of the most powerful tools in the modern scammer’s arsenal.”\n\nAmong the report’s key findings were that financial fraud and scams are growing in volume and precision because “AI and other advanced technology have given criminal organizations the ability to generate personalized, culturally calibrated, grammatically flawless communications at mass scale; to clone the voices of loved ones that are indistinguishable from real distress calls; and to create deepfake videos convincing enough to authorize substantial wire transfers from the finance departments of major corporations.”\n\nThe growing use of more powerful AI tools, however, also means that the capabilities can be successfully harnessed to combat these schemes.\n\n“Criminals are increasingly adopting AI and other cutting-edge technologies to perpetuate fraud and crimes,” the report said. “The counter to this is ensuring that those empowered to prevent and respond to fraud and scams — namely public and private sector entities — deploy the same tools.”\n\nAI has already been used by some agencies, including the Centers for Medicare and Medicaid Services, to identify and prevent waste, fraud and abuse across their operations. A CMS official previously told *Nextgov/FCW* that uses of the emerging capabilities have helped the agency [save more than $2 billion](https://www.nextgov.com/artificial-intelligence/2026/03/cms-expands-tech-driven-fight-against-medicaid-fraud/412256/) that would have otherwise gone toward improper payments.\n\nAs uses of AI as an anti-fraud tool increase, however, the report said “it is imperative that Congress and federal regulators understand the use and effectiveness of such tools.” This includes, it added, better insights into the effectiveness of these capabilities so policymakers “can help identify both successful practices and any regulatory or operational barriers that may limit their adoption.”\n\nThe document also said Congress should pass several bills that would potentially expand AI’s use in fraud prevention activities.\n\nThese include the Bank Fraud Technology Advancement Act, a bipartisan measure [introduced](https://www.congress.gov/bill/119th-congress/house-bill/8671) in May by Rep. Mike Flood, R-Neb., that calls, in part, for federal banking agencies to study “the use of advanced technologies in fraud detection and prevention, with particular attention to community financial institutions.” The proposal would also create a community bank fraud technology pilot program to help covered banks gain access to “advanced fraud detection tools.”\n\nThe report also said lawmakers should pass the Artificial Intelligence Practices, Logistics, Actions and Necessities — or AI PLAN — Act. The bill, another bipartisan proposal that is sponsored by Rep. Zach Nunn, R-Iowa, was [introduced](https://www.congress.gov/bill/119th-congress/house-bill/2152/text) in March 2025 and would direct the departments of Homeland Security, Commerce and Treasury to develop a joint plan for combating nefarious uses of AI, including ways of countering AI being used to conduct financial fraud.", "url": "https://wpnews.pro/news/gop-financial-services-report-cites-ai-as-both-fraud-accelerator-and-preventer", "canonical_source": "https://www.nextgov.com/artificial-intelligence/2026/07/gop-financial-services-report-cites-ai-both-fraud-accelerator-and-preventer/414956/", "published_at": "2026-07-23 12:42:00+00:00", "updated_at": "2026-07-23 13:27:14.128538+00:00", "lang": "en", "topics": ["artificial-intelligence", "ai-policy", "ai-safety"], "entities": ["House Financial Services Committee", "Rep. French Hill", "Federal Trade Commission", "Centers for Medicare and Medicaid Services", "President Donald Trump", "White House"], "alternates": {"html": "https://wpnews.pro/news/gop-financial-services-report-cites-ai-as-both-fraud-accelerator-and-preventer", "markdown": "https://wpnews.pro/news/gop-financial-services-report-cites-ai-as-both-fraud-accelerator-and-preventer.md", "text": "https://wpnews.pro/news/gop-financial-services-report-cites-ai-as-both-fraud-accelerator-and-preventer.txt", "jsonld": "https://wpnews.pro/news/gop-financial-services-report-cites-ai-as-both-fraud-accelerator-and-preventer.jsonld"}}