26/08/2024
Hello everyone. Warning on scams to watch out. I was almost scammed, if not because of my more new sophisticated Apple laptop.:..
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"Imitation is a kind of artless flattery"
— The Spectator magazine, c. 1714
Take a look at these two images from Facebook…
One is real. The other an AI-generated video.
Can you spot the difference?
Many of us will have seen AI tools like ChatGPT in action and know how they can make our lives easier.
Whether it’s planning a weekend get-together or drafting important emails, AI tools have become incredibly helpful and almost indispensable.
However, there is a downside.
The same advances in AI that assist in our day-to-day lives have also lowered the barriers for criminals and fraudsters.
Namely, in this case, with the ease of creating “deepfake” videos - videos which, while fake, are frighteningly close to the real thing.
Using AI-generated advances, deepfake videos manipulate legitimate video footage, transforming it into something entirely different.
And it’s simply becoming harder to distinguish between genuine and altered content... increasing the potential for scams and misinformation.
Celebrities and people in trusted positions have already run afoul of these faked videos, often 'endorsing' scam investments.
Of course, it’s merely a new technological twist in the age-old story of scams and fraud.
Scams and fraud have been around since people first realised they could gain an advantage over others by bending the truth. In fact, one of the earliest documented examples of insurance fraud dates back over 2,000 years ago!
Around 300 B.C., Greek merchant Hegestratos — who could easily be the poster child for early fraudsters — took out a large insurance policy known as bottomry.
Bottomry was a type of loan arrangement where a ship owner or merchant would borrow money using the ship itself (the "bottom" or keel) as collateral. Often to make urgent repairs while at sea.
If the merchant refused to pay back the loan, the lender could claim the cargo and the boat used for its transportation.
In this case, Hegastratos borrowed a large sum of money and agreed to pay it back with interest when the cargo (corn) was delivered. But he actually planned to sell the corn, sink his empty boat, and keep the loan.
Ultimately the plan failed, and Hegestratos drowned trying to escape his crew and passengers when they caught him in the act.
Fast forward a couple of millennia, and you'd think we’d have learned our lesson. Yet, the schemes just keep coming, this time in the form of early “impersonation” scams.
Imagine it’s the 19th century, and you've just received a letter: a wealthy prisoner is stuck in Spain, wrongly-accused, and needs a bit of money to secure his release.
In return for helping him, you’ll be rewarded with a handsome cut of some previously-hidden treasure, and potentially even his daughter's hand in marriage.
The scam was so successful versions of it continued into the 1900s. Although, in truth, the Spanish Prisoner scam has never truly ended... it's just evolved.
Modern versions include the infamous 'Nigerian Prince' scam, where victims are asked to assist in transferring a large sum of money out of a foreign country in exchange for a share of the fortune.
Excerpt from the memoirs of Eugène-François Vidocq (1775-1857), an early French criminologist, describing a French version of the scam.
Throughout history, many early scams relied on impersonation, fake investment schemes, and selling non-existent products or services.
For instance, in the 1920s, Victor Lustig twice "sold" the Eiffel Tower to scrap metal dealers by impersonating a government official, collecting down payments and then disappearing.
In the early 1600s, several impostors claimed to be Dmitry Ivanovich, the son of Tsar Ivan the Terrible of Russia, with one even briefly ruling as Tsar before being killed.
In the 1820s, Scottish confidence trickster Gregor MacGregor impersonated the "Cazique" of the made-up "Principality of Poyais" in Central America, selling land grants and producing fake currency to lure investors.
So, while the technology and methods have evolved, the essence of impersonation fraud remains the same. Whether it’s deepfake videos or Victorian letters, the age-old art of the scam is alive and well.
Prominent Australians like former ASX CEO Dominic Stevens, billionaire Andrew Forrest, and mining magnate Gina Rinehart have all been caught up in these scams, highlighting their ever-present risk.
So, given our track record of helping thousands of Australian investors, I guess it’s no wonder that our own Chief Investment Officer Scott Phillips has also been among the high-profile targets of these deepfake videos.
While we have made some big early calls on some individual stocks…
We'd never promise you a 'categorical and guaranteed 60% return' like in the fake video above (with a British-accented Scott Phillips).
In a world where scams and fraud are increasingly sophisticated, it's more important than ever to have reliable, expert sources you can trust.
from Motley Fool Research Paper..........
I personally subscribed to this Research Report Before.
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