Joseph Cox, a privacy journalist and the co-founder of the independent press house 404 Media, has related in a controversial blog how he successfully used a generated fake ID for the Know-Your-Customer (KYC) verification process on a crypto exchange. Notably, such fake documents may also be used on other financial trading apps that require users to complete KYC verification.
Cox said he created two highly convincing photos of IDs of a California driver’s license and a British passport for $15 each. He used an underground website called OnlyFake, which claims to use “neural networks” to generate realistic-looking photos of fake IDs.
The IDs generated from the site can streamline everything from bank fraud to laundering stolen funds. According to Cox, a remarkable attribute of the IDs created using OnlyFake is that it gives the appearance that the card is lying on a fluffy carpet, as if someone has placed it on the floor and snapped a picture, which is a requirement from some sites for verification purposes.
Fake IDs for Verifying Crypto Exchange Accounts Allegedly Worked on OKX
Using the fake British passport, the private journalist tested OKX’s verification process. Surprisingly, he bypassed the exchange’s identity verification check indicating vulnerabilities in the system.
New: inside the underground site where "neural networks" churn out fake IDs
– I tested, made two IDs in minutes
– used one to successfully bypass the identity verification check on a cryptocurrency exchange
– massive implications for crime, cybersecurityhttps://t.co/hCjHWbKJPf pic.twitter.com/sd8ofmdEOE— Joseph Cox (@josephfcox) February 5, 2024
When the journalist confronted the exchange over the vulnerability in the system, Jumio OKX’s verification partner, who had previously highlighted its robust process in identifying fake profiles, refrained from commenting on the exchange’s specific procedures.
In a statement, OKX strongly denied allegations of verifying a fake ID. The exchange added:
“We are actively working with our internal teams and our external partner to investigate the allegations. We are committed to aggressively fighting fraudulent conduct on our platform and seeking the highest standards of compliance. It is apparent that the abusive use of AI to conduct fraudulent activity is an evolving and industry-wide challenge which OKX is comprehensively addressing.”
Meanwhile, the website “OnlyFake” used by the journalist to generate the fake IDs went offline following the investigation and was exposed by the media company. This incident is a clear scenario that the abusive use of AI to conduct fraudulent activities is going to pose a huge problem for financial institutions, government agencies, and other companies if left uncurbed.
