The Securities and Exchange Board of India (SEBI) issued a warning on July 17 about a surge in cyber frauds known as "Boss Scams," where fraudsters impersonate company executives using AI technologies. The scams involve tricking finance teams of regulated entities and listed companies into transferring funds under false pretenses, according to a SEBI press release reported by medianama.com.
The Indian Cyber Crime Coordination Centre (I4C) alerted SEBI to these scams, which increasingly use AI-generated deepfakes, voice cloning, and social engineering tactics. Fraudsters pose as CEOs or senior officials via email, WhatsApp, Microsoft Teams, or other platforms, instructing employees to execute urgent financial transactions. One method involves AI-powered impersonation with fake video calls or social media groups, while another uses malicious ZIP files containing malware that hijacks WhatsApp Web sessions or compromises devices to facilitate fraud.
These scams exploit the confidentiality around Unpublished Price Sensitive Information (UPSI) by instructing finance officers to keep transactions secret while transferring funds to mule bank accounts. The use of AI tools to create convincing impersonations marks a significant evolution in cyber fraud tactics, posing new challenges for corporate security. SEBI’s alert underscores the growing risk of AI-enabled financial fraud in India’s regulated markets.
SEBI’s press release on July 17 serves as an official advisory to all listed companies and regulated entities to enhance vigilance against such AI-driven impersonation scams. The regulator emphasized the need for robust verification protocols before executing financial transactions initiated by senior executives.