U.S. Lawmakers Propose 30-Year Prison Terms for AI-Powered Financial Fraud

Bipartisan legislation introduced Tuesday targets the explosive growth of AI-driven scams infiltrating financial markets. The AI Fraud Deterrence Act, spearheaded by Rep. Ted Lieu (D-CA) and Rep. Neal Dunn (R-FL), imposes draconian penalties—up to 30 years imprisonment and $2 million fines for bank fraud involving artificial intelligence.

The bill specifically addresses synthetic media threats, including deepfake impersonations of federal officials, now punishable by three-year sentences. This crackdown follows a surge in AI-enabled market manipulation, with criminals deploying voice-cloning and algorithmic impersonation to exploit crypto traders and traditional investors alike.

Wire fraud and money laundering statutes receive parallel upgrades, reflecting Washington's alarm over AI's weaponization in financial crimes. The proposal arrives as blockchain analysts report sophisticated phishing campaigns targeting DeFi platforms—a trend compounding regulators' concerns about pseudonymous crypto transactions enabling such schemes.