AI: It’s All Fun and Games Till Someone Gets Hacked

Joanna Stone, from the Wall Street Journal, created an avatar of herself and challenged her clone to replace her for 24 hours. That sounds great! Why not have a bot do your job while you sleep in, have a self care day and walk your dog?⁽¹⁾It’s all fun and games till someone gets hacked.

What did she discover?

Joanna sent videos and voice messages to her co-workers and her sister. They were convinced at first, but soon figured out it was not her. What was the clue? The clone’s body didn’t move with the rest of her head and some of the intonations and pauses were not quite right. And then she did a test that was concerning. The bot successfully mimicked her voice, passed the voice recognition security test, and accessed her bank account.

One of the tools Joanna used to create her clone cost as little as $5/month. As AI improves its’ biometric technology it’s going to be more difficult to separate what is real from what is fake. We all need to be on high alert to determine what is real and what is AI.

How bad is the problem?

On October 31^st, the NASDAQ Composite declined 2.76%. This was led by Microsoft and Meta (owner of Facebook) who were down 6% and 4.1% respectively. ⁽²⁾ Why?!? “You had three of the Magnificent Seven* all say they basically have open-ended budgets for AI spend and investors don’t like to hear that,” said Carol Schleif, chief investment officer at BMO Family Office. ⁽³⁾

The good news is that the tech companies know there is a problem, and they are taking it seriously.

The financial services industry is an obvious and coveted target. As advisors, we are learning about the advanced techniques that hackers are using to move your money to their account. The consequences can be devastating

What are we doing about it?

If one of our clients asks for a funds transfer:

We are going to hang up, call the phone number we have on file, and have a brief chat about your personal life. We want to make sure it’s “really you.”
If the transaction takes more than one call, we will hang up, rinse, and repeat.
We will not accept any kind of statements via email. Documents need to be uploaded to our secure and encrypted Black Diamond Vault. Michelle and I are here to help you navigate this step and make it easy.

How can we further protect ourselves from threats?

Password protected internet access. Almost all of us pay for internet access at home and / or work and we add passwords to our internet access. Does that protect us from our neighbors or hackers? Lately, that seems a bit too simplistic. Additionally, users are not protected if they are sitting at a Starbucks or other public place. Just to be sure, I’m taking more steps.
Virtual Private Networks (VPN). These programs encrypt your connections and changes your IP address to a virtual location. The virtual address means you are no longer next door. You could be anywhere in the US. This protects your online activity from spying eyes and helps to keep your data safer from cybercriminals. I subscribe to (but not endorse) Nord VPN.
Malware Protection, or Malicious Protection software. Some of the more popular are Norton Antivirus or McAfee. These should protect you from worms, trojans, bots, and other threats to your computer, identity, and files. This is a good step for mitigating damage once something gets into your computer. But this also means the thief has entered your computer. I want more than that.
Full Disk Encryption. (FDE) If a thief gets into my computer, I don’t want him/her to be able to see any of my files. FDE works by automatically converting your data into a format that can’t be understood by anyone who doesn’t have the key to undo the conversion. Only the computer owner holds that encryption key. I use (but do not endorse) ESET. Their Ultimate Plan gives you both the Malware, Full Disk Encryption, and $1M insurance for identity recovery.

It’s not fun to pay for these, but they are relatively inexpensive and the protection they offer is priceless. With Black Friday around the corner, many of these services are already discounting their subscriptions.

If you are a client and feel you cannot afford these services, then Sage Path Solutions will help you pay for them. Just reply to this email with “I’d love your help!” Our goal is to help protect you and your life savings.

Please let us know if you have questions or if we can help you navigate your software and your safety.

Stay safe,
Barbara

*Magnificent Seven stocks: Alphabet, Amazon, Apple, Meta Platforms, Microsoft, and Tesla.

Past performance is no guarantee of future results. Investing involves risk, including possible loss of principal. Investors should consider the investment objectives, risks, charges and expenses of the investment company carefully before investing. The prospectus and, if available, the summary prospectus contain this and other important information about the investment company. You can obtain a prospectus and summary prospectus from your financial representative. Read carefully before investing.