European startups get serious about deepfakes as AI fraud losses surpass €1.3 billion

European startups are increasingly focused on combating the surge in deepfake-related fraud, which has led to significant financial losses. A recent study by cybersecurity startup Surfshark revealed that losses linked to deepfakes have surpassed €1.3 billion, with €860 million stolen in 2025 alone. This represents a €500 million increase year-on-year, highlighting the escalating threat. The dramatic price collapse in generating synthetic media is a key factor, with a one-minute deepfake video now costing only a few euros to produce. As a result, new categories of fraud have emerged, including "lost pet" scams, where fraudsters exploit emotional vulnerabilities. Additionally, deepfakes are being used in corporate recruitment processes to bypass background checks. This rising threat has spurred innovation and investment across Europe, with several startups receiving funding to tackle deepfake-enabled fraud. Spanish cybersecurity platform Acoru recently raised €10 million to help banks predict and prevent AI-powered fraud, while Italian startup IdentifAI secured €5 million to expand its deepfake detection platform. Trustfull, another Italian company, raised €6 million to broaden its fraud-prevention suite. These developments demonstrate a growing commitment from European startups to address the challenges posed by AI-driven deception. As the market for fraud detection and prevention continues to grow, it is expected that more European companies will enter this domain.