Fighting Fire With Fire: How credit unions can use AI in the fight against scams and fraud

By Becky Ross, Head of Marketing, Carefull

Artificial intelligence (AI) is showing up everywhere; you can’t open a news source without discovering a new way it’s being used in everyday life. Unfortunately, that same AI is also fueling scams, fraud, and emotional manipulation of your members. But you don't have to just stand by, credit unions are also leveraging the power of AI to stop fraud and scams, a movement we call “fight fire with fire.”

For credit unions, institutions built on trust, member service, and community protection, this poses a strategic challenge: How do we defend our members from increasingly sophisticated threats when the very tools used by fraudsters are advancing faster than conventional fraud controls?

The answer lies in matching innovation with innovation: fighting fire with fire through AI.

AI Fraud and Scam Threats

Emerging scams aren’t just about stolen credentials or simple account takeovers anymore. Today’s threats combine psychological manipulation, rapid automated targeting, and subtle financial exploitation that often sneak through rule-based fraud systems. All of these frauds are more complex, moving faster, and harder to spot because of AI. For example, with AI image video and voice technology scammers can now almost identically replicate a family member, friend, or even a staff member from a credit union. Traditional fraud alerts, based on fixed thresholds or static rules, struggle to detect patterns that unfold over time or mimic legitimate behavior.

For credit union members, particularly older adults who control a significant share of household wealth, a single successful scam can mean devastating financial loss and broken trust with their financial institution.

AI as a Defense

Preventative fraud solutions that leverage AI offer a fundamentally different approach to risk detection from traditional fraud system:

• Behavioral Baselines Over Static Rules: AI models analyze how a member “normally” behaves in terms of spending, withdrawals, and financial habits, then detect and alert subtle deviations that may signal risk.

• Adaptive Learning: Unlike traditional systems that must be manually tuned, advanced AI continuously learns from new transactions and emerging scam tactics, staying ahead of attackers.

• Complex Pattern Detection: Beyond identifying single suspicious events, AI can recognize patterns associated with cognitive changes, social engineering, and long-term exploitation.

This next generation of intelligence is being called an “intelligence layer” because it doesn’t just react, it anticipates, contextualizes, and alerts before losses occur.

How Credit Unions Benefit

For credit unions, AI-driven fraud detection is not just a technical enhancement, it’s also a member-centered approach that aligns with your core mission. AI systems empower institutions to:

• Detect emerging scams earlier, even when tactics shift daily.

• Reduce false positives, preserving strong member experiences.

• Support vulnerable members, particularly older adults, with real alerts based on their personal financial behaviors.

• Extend trust and safety beyond the branch, into daily digital financial activity.

Partnering with AI-powered solutions gives credit unions a scalable and adaptive defense that matches the pace of modern financial crime.

Credit union members deserve more than blocking bad transactions after the fact, they need proactive intelligence that evolves as threats do. As credit union leaders, you’ve built institutions that protect and empower members. Now is the time to ensure your fraud and risk systems are as dynamic and resilient as the threats they face. It’s about upholding trust in every member relationship.

Put simply: it’s time to fight fire with fire.

Connect with Carefull to learn more.