Key Takeaways:
- Crypto exchangeOKX faces scrutiny amid reports of accepting fake IDs for its KYC verification.
- $15 AI-generated fake IDs are allegedly bypassing crypto exchange identity checks
OKX, a prominent cryptocurrency exchange, has found itself embroiled in controversy amid allegations that it may be allowing the use of counterfeit identification documents for its Know-Your-Customer (KYC) verification process.
Reports indicate that a service known as OnlyFake is utilizing advanced artificial intelligence technology, including neural networks and generators, to produce convincing fake driver’s licenses and passports from 26 countries, including major nations such as the United States, Canada, the United Kingdom, Australia, and various European Union countries.
This revelation comes at a critical juncture, coinciding with new regulatory mandates from the Financial Conduct Authority (FCA) of the UK. OKX is reportedly proposing guidelines for its users based in the country to comply with these stringent requirements.
Notably, OnlyFake accepts payments in multiple cryptocurrencies through Coinbase’s commercial payments platform. The service, attributed to an individual known as “John Wick,” boasts the ability to generate a wide array of identity documents with unprecedented efficiency and scale, ranging from driver’s licenses to passports for numerous countries.
These fabricated documents are visually convincing, incorporating realistic backgrounds to enhance their authenticity. Shockingly, reports suggest that a fake British passport created by OnlyFake successfully passed verification checks on the OKX crypto exchange.
Moreover, users on a Telegram channel have claimed success in using these counterfeit IDs to bypass checks on other exchanges such as Kraken, Bybit, Huobi, and PayPal.
This development poses a grave risk, as scammers and hackers could exploit these fake IDs to establish accounts and conceal their true identities, thereby complicating efforts to trace their activities.
However, OKX’s customer support has reportedly acknowledged that the exchange may not be conducting comprehensive KYC/AML procedures during the account creation or cryptocurrency deposit stages. Instead, OKX appears to focus on KYC/AML checks when users attempt to withdraw funds from the platform.
This revelation raises concerns about OKX’s compliance with regulatory standards and its commitment to preventing money laundering and illicit activities within its ecosystem.
Amidst mounting concerns over the proliferation of convincingly realistic fake IDs facilitated by advanced artificial intelligence (AI) technology, Coin Center’s Director of Research, Peter
Van Valkenburgh, has emphasized that the issue transcends the realm of cryptocurrency.
Valkenburgh contends that every institution, whether crypto-related or traditional, is poised to confront a significant challenge stemming from rampant identity fraud facilitated by AI.
