News

Be aware of clients using AI to bypass identity checks

22 April 2026

The National Economic Crime Centre (NECC) recently issued an alert to its partner financial institutions with information on the scale of AI's use in bypassing customer due diligence (CDD) checks in the UK financial sector.

AI has been detected in various parts of the CDD process, including to manipulate or create identity documents and produce deepfakes to deceive liveness detection tests. Most attempts are unsuccessful, but some have been able to bypass controls, confirming this as a current threat not a theoretical one. Accounts created using AI have been linked to other crimes, such as fraud and money laundering.

But what does this mean for the legal sector? Here are our top tips:

• Be aware of the risk posed by AI tools known as deepfakes, which can impersonate a real person's appearance convincingly.
• Assess the heightened risk of relying on video calls to identify and verify your client.
• If you only meet clients remotely, understand whether your electronic due diligence protects you against this.
• Explore software solutions to assist in detecting deepfakes, many are available on the market.

Take a look at our sectoral risk assessment as a reminder.

Following the release of guidance on the use of digital ID verification, the government has provided further clarity on the use of providers and the digital identity services register. We have updated our blog on what this means for law firms.