AI fraud hits Canadian companies’ bottom lines, KPMG survey shows

AI fraud is quickly emerging as a major threat to Canadian organizations, with nearly three-quarters (72 per cent) losing as much as five per cent of their annual profits to AI-driven scams last year, new research from KPMG Canada shows.

The findings underscore an increasingly complex fraud landscape as 81 per cent of businesses that experienced fraud in the past year say they faced an AI-enabled attack with seven in 10 being targeted more than once.

As a result, nine in 10 (94 per cent) business leaders say they are concerned about encountering AI-powered attacks in the year ahead. Yet despite the risks, only 26 per cent have a comprehensive and tested response plan to defend against AI‑enabled attacks such as deepfakes and voice clones.

“AI‑powered fraud is changing the ground rules. Canadian organizations aren’t just seeing more attempted attacks – they’re more sophisticated, harder to spot and faster to execute, leaving many businesses vulnerable and unprepared to fight back,” says Myriam Duguay, Partner and National Leader of Forensic Investigation, Integrity and Dispute Services at KPMG Canada.

“Beyond the immediate financial hit, the reputational fallout from a fraud attack can be devastating. A single scam can shatter customer confidence, result in lost business, and leave lasting damage to a company’s brand. Now, with rise in AI-powered attacks that can mimic legitimate business interactions with alarming accuracy, the margin for error becomes razor-thin and having strong fraud defences is even more essential.”

Top three most common AI fraud schemes

phishing

AI-generated phishing emails/chats

plagiarism

Deepfake/ manipulated documents

phone

Executive voice-clone calls

The most common attacks they encountered were AI-generated phishing emails/chats (60 per cent), deepfake documents (39 per cent) and voice‑clone executive impersonation calls (24 per cent).

Key poll highlights:

72 per cent say they lost between one and five per cent of their business profits to AI-powered fraud attacks in the past 12 months
81 per cent of 251 Canadian business leaders surveyed by KPMG who experienced fraud in the past 12 months say the attack was AI-enabled
72 per cent of organizations which experienced AI-enabled fraud attacks last year say they were targeted more than once
94 per cent say they are concerned about the risk of AI-powered attacks targeting their organization in the next 12 months
26 per cent say they have a formal, comprehensive and tested fraud incident response plan that explicitly covers AI-enabled attacks

Battle of the bots: Fighting AI fraud with AI tools

As AI‑enabled fraud becomes more frequent and difficult to detect, Canadian businesses are increasingly deploying AI as a defensive tool, with over half (52 per cent) saying they are directly “fighting AI with AI” by leveraging the technology to identify anomalies, authenticate users, and detect manipulated content.

Where do you plan to allocate your fraud prevention budget?

74% Detection technology

72% Employee training
and awareness

60% Transaction controls
(e.g., dual authentication)

Recognizing the need to bolster their defences, six in 10 respondents plan to increase their fraud prevention and detection budgets by up to seven per cent this year. Further, 81 per cent of companies conduct employee fraud awareness training every six-to-12 months. Key investment areas include detection technology, employee training and transaction controls, the survey finds.

“Businesses recognize that they are facing a new reality in the fight against fraud, and they’re deploying advanced tools to keep pace with fast‑moving threats,” says Marilyn Abate, a partner in KPMG Canada’s Risk Services practice who specializes in fraud and forensic investigations in the financial services industry. “While that’s a good step forward, technology alone isn’t enough. It’s not just about buying technology; it’s about equipping people to use it well, closing skills gaps, and running programs that evolve just as quickly as the threats.

“The good news is that organizations are no longer standing still – they’re starting to invest, adapt, and treat AI‑enabled fraud as a strategic business risk. While momentum is building, many organizations still have significant work ahead to fully modernize and strengthen their defences against rapidly evolving AI‑enabled fraud,” she adds.

In addition to specialized staff training, Ms. Duguay and Ms. Abate recommend the following to improve anti-fraud programs in the age of AI:

Think of fraud prevention not just as a technology issue, but as a strategic capability that incorporates governance, talent, and accountability
Avoid incrementally enhancing existing pre-AI operating models and relying on point-in-time checks
Instead, utilize continuous, risk-based controls to prevent, detect, and disrupt fraud earlier in the lifecycle

Fraud prevention

Combat threats by integrating forensic, financial crime and cyber security.

Learn more

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About the KPMG Canada Business Fraud survey

KPMG Canada surveyed business owners or executive level C-suite decision makers at 251 Canadian companies about the instances of fraud they experienced. The survey took place between February 4-13, 2026, using the Angus Reid Group’s premier business research panel. Fifty-five of the companies surveyed have annual gross revenue between $300 million to $1 billion; 23 per cent have over $1 billion; and 22 per cent have between $50 million to $299.9 million. No respondents under $50 million in annual revenue were included in the survey. Over half (62 per cent) are privately held and 38 per cent are publicly traded. Fifty per cent are based in Ontario, 19 per cent in Alberta, 13 per cent in British Columbia, and 10 per cent in Quebec. The remaining respondents are from other regions across Canada.

About KPMG in Canada

KPMG LLP, a limited liability partnership, is a full-service Audit, Tax and Advisory firm owned and operated by Canadians. For over 150 years, our professionals have provided consulting, accounting, auditing, and tax services to Canadians, inspiring confidence, empowering change, and driving innovation. Guided by our core values of Integrity, Excellence, Courage, Together, For Better, KPMG employs more than 10,000 people in over 40 locations across Canada, serving private- and public-sector clients. KPMG is consistently ranked one of Canada's top employers and one of the best places to work in the country.

The firm is established under the laws of Ontario and is a member of KPMG's global organization of independent member firms affiliated with KPMG International, a private English company limited by guarantee. Each KPMG firm is a legally distinct and separate entity and describes itself as such. For more information, see kpmg.com/ca.

For media inquiries:

Alannah Page
National Communications and Media Relations
KPMG in Canada
(306) 934-6255
alannahpage@kpmg.ca

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