Internal Audit and AI-Enabled Fraud
Artificial intelligence is changing the way organizations work, but it is also making fraud faster, more scalable, and more advanced. AI is increasingly being used to create convincing fake documents, alter audio and video, and tailor deception to specific individuals. As a result, established controls are struggling to keep up, placing internal audit at an important inflection point.
Fraud risk is evolving quickly due to three developments:
- AI is introducing new fraud methods while also speeding up and amplifying existing schemes.
- Attack techniques are becoming more advanced, because AI makes deception harder to spot and easier to deploy broadly.
- Many audit teams are not fully prepared, as gaps remain in tools, capabilities, and confidence to detect and respond to AI enabled fraud.
The report shows that awareness of AI enabled fraud risk is increasing, but it also identifies room to strengthen internal audit’s readiness. Based on input from 373 senior internal audit leaders, the research points to where knowledge is still incomplete, which obstacles limit progress, and how deeper familiarity with AI can support stronger detection, better control evaluation, and more effective advisory work. Taken together, the insights describe how internal audit can shift from mainly reacting to fraud risks toward taking a more forward looking role in an AI driven fraud environment.
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