Lead Fraud Raises CPA and Ups Compliance Risks

By 2025, we know that lead fraud has evolved from a minor nuisance into a serious threat, reshaping how businesses generate and manage leads. Fraudsters are getting smarter, deploying advanced tactics that drive up your cost per acquisition (CPA) and expose your business to compliance nightmares.

The numbers are staggering: up to 30% of leads sold by third-party vendors are fraudulent, draining budgets and wasting precious resources. Fake leads mean wasted hours for agents chasing dead ends and frustrated consumers who never agreed to be contacted. The result? Eroded trust in your brand and fewer real opportunities to close deals.

And it’s not just humans you’re up against. The digital landscape is shifting, with only 50.4% of web traffic coming from humans, while malicious bots account for 32%. Separating genuine prospects from fraud has become a high-stakes challenge.

To stay competitive in this evolving landscape, call centers are adopting smarter tools, streamlined processes, and robust fraud prevention strategies. Read on to learn more about how lead fraud is driving up CPAs and compliance risks and what you can do to protect your sales pipeline in 2025.

This trend article is part of the series, “Contact Center Trends,” helping you stay current with issues, technologies, best practices, and strategies that impact your business. Our aim is to provide tools and guidance that will improve productivity, efficiency, and sustainable profitability for your sales and lead generation team.

The growing threat of lead fraud

Lead fraud has evolved. In 2025, it’s no longer about obvious, easily dismissed fakes. Fraudsters are pulling out all the stops, using sophisticated techniques that make detecting and preventing fraudulent leads harder than ever.

Take human fraud farms, for example. Fraudsters now hire real people to fill out lead forms, bypassing standard defenses like captchas and bot traps. These leads might look authentic on paper, but they’re anything but. 

Adding fuel to the fire is aged-lead recycling, where outdated or already-used leads are dressed up and resold as new. Together, these tactics create a perfect storm that wastes resources, skews data analytics, and damages brand reputations.

What’s even more concerning? Fraudsters are leveraging AI tools like “fraud GPT,” found on the dark web, to create bots that learn and adapt in real time. These bots are smarter, faster, and harder to spot, making traditional detection methods obsolete. 

“Fraudsters use AI to create more advanced and adaptive bots that get smarter every minute of every day,” says Rich Kahn, co-founder of the fraud tool Anura. 

Lead fraud isn’t just a nuisance—it’s a direct threat to your business’s growth and reputation. In this shifting landscape, understanding how fraud works and taking action to stop it before it infiltrates your pipeline is no longer optional—it’s essential.

How lead fraud raises CPA

Imagine spending thousands on lead generation only to discover a large chunk of your investment is funding fraud instead of fueling growth. Marketing teams pour time and effort into nurturing bogus leads, while sales agents chase down prospects that either don’t exist or never gave their consent.

The financial impact is hard to ignore. According to Juniper Research, ad fraud cost advertisers $84 billion in 2023, with 22% of all digital ad spend lost to fraud. To put that into perspective, if your business spends $10,000 on lead generation ads, $2,200 of that investment is going straight into fraudulent activity—money that’s producing zero results.

“You’re spending money to get those leads one way or another, whether you’re buying them or driving them in yourself. Once they’re in your system, you’re spending even more to find out they were bad leads all along,” Kahn says.

And while your team is spinning their wheels on fake leads, real prospects—the ones that could actually drive revenue—are slipping through the cracks. Fraud doesn’t just inflate your CPA; it undermines campaign efficiency and leaves your business struggling to compete.

In 2025, the key to lowering CPAs isn’t just working harder—it’s working smarter. By identifying and stopping fraudulent leads at the top of the funnel, you can redirect your budget and resources to genuine opportunities, ensuring your team stays focused on what truly matters.

The compliance risks of fraudulent leads

Fraudulent leads aren’t just a financial drain—they’re a compliance nightmare waiting to happen. Even a single call or text to someone who never gave consent can trigger hefty fines, lawsuits, and long-lasting damage to your reputation. And as fraudsters become more sophisticated, the risks are only growing.

The issue boils down to one critical flaw: fraudulent leads often come with fake or incomplete consent records. This makes it nearly impossible to prove that you had permission to contact the individual. Worse, even if these leads come from a third-party vendor, the liability doesn’t stop with them. “The person making those dials... is the one on the hook for a TCPA violation,” Kahn says.

The stakes have never been higher. Regulators are ramping up enforcement, and privacy laws are becoming stricter by the day. TCPA class action lawsuits increased by 21% between 2023 and 2024, so your call center isn’t likely to get away with contacting illegitimate leads. And considering that the average TCPA class action settlement is $6.6 million, the cost of non-compliance can be devastating.

Damage to agent morale and call center operations

Your agents are the heart of your operation, but fake leads sap their energy and enthusiasm, turning every call into a potential dead end. When fake leads flood your pipeline, your team is left chasing prospects who never wanted to be contacted. It’s frustrating, exhausting, and a recipe for burnout.

The problem has only worsened with the rise of bot traffic. 42% of all digital traffic now comes from bots, and 65% of those bots are malicious. These fake entries clog your campaigns, leaving agents to deal with confused or annoyed recipients who have no idea why your company called them.

It’s a vicious cycle. Day after day, agents invest time and energy into calls that go nowhere. “By the time an agent finally connects with a legitimate prospect, their morale is already shot,” Kahn says. With enthusiasm drained, their ability to engage and close deals takes a hit, dragging down campaign performance even further.

This emotional toll often leads to high turnover. Burned-out agents are more likely to leave, and replacing them isn’t just expensive—it diverts resources away from growing your business. Training new hires and rebuilding team cohesion takes time, leaving your call center in a constant state of recovery.

The solution starts with protecting your pipeline. By keeping fraudulent leads out, you allow your agents to focus on real opportunities with leads who want to hear from them. This boosts productivity and creates a more positive work environment where agents can thrive. Protecting your team is about more than morale; it’s about ensuring your entire operation runs smoothly.

Tech tools that turn fraud and compliance risks into opportunities

In 2025, lead fraud and compliance challenges are more intertwined than ever. Fraudulent leads don’t just inflate costs—they put your business at risk of serious legal trouble. Each fake lead that slips into your pipeline carries the potential for compliance violations. The stakes are high, but the right technology makes it easier than ever to stay ahead.

The secret? A layered approach that pairs advanced fraud detection with robust compliance tools. 

Fraudsters aren’t standing still—they’re evolving their tactics, using techniques like human fraud farms and AI-driven bots to outsmart traditional defenses. 

As Kahn explains: “Fraudsters are using advanced techniques like human fraud farms and AI-driven bots to bypass traditional detection methods. By scanning records upfront, you can confirm leads were generated by real people and avoid costly mistakes.”

This is where solutions like Anura and Convoso come in. Anura starts at the very top of your sales funnel, scrubbing out fake leads before they have a chance to cause damage. It ensures that only verified, legitimate prospects make it into your system. From there, Convoso picks up the baton with tools like StateTracker™, which keeps your campaigns compliant with state-specific regulations.

Convoso has a suite of tools to help support compliance with TCPA regulations. The integration of Anura within the Convoso platform helps make sure that leads coming into the system are being scrubbed and cleaned at the same time.

This seamless integration of fraud detection and compliance technology allows your team to operate with confidence. Verified leads flow straight to your agents, eliminating wasted effort and boosting productivity. Features like Convoso’s workflow automation and ClearCallerID Pro™ further protect your reputation, reducing spam labeling and keeping your contact rates strong.

But the benefits go beyond safeguarding your business. By removing fraudulent leads from your pipeline, you transform it into a growth engine. Agents can focus on real opportunities, leading to higher engagement, better results, and stronger customer relationships.

In 2025, success isn’t just about reacting to fraud—it’s about outsmarting it. With the right tools and proactive strategies, you can turn the challenge of lead fraud into an opportunity to strengthen and scale your business.