In today’s world, businesses of all sizes and types rely heavily on email communication. Email is a fast, easy, and convenient way to send and receive information, but it also creates vulnerabilities that can be exploited by cybercriminals. One such vulnerability is Business Email Compromise (BEC), which is becoming an increasingly common threat to businesses of all sizes. In this article, we will provide a comprehensive overview of BEC, including its types, how it works, and preventive measures to protect your organization.
- Definition of Business Email Compromise
BEC is a sophisticated scam in which attackers use fraudulent email messages to trick employees into transferring funds or sensitive information to a malicious third party. This type of attack is also known as CEO fraud, wire transfer fraud, or email account compromise. BEC attacks are often highly targeted and can be difficult to detect, making them a significant threat to organizations.
- Statistics on Business Email Compromise
BEC attacks have become increasingly common in recent years. According to the FBI’s Internet Crime Complaint Center (IC3), BEC attacks have resulted in losses of over $26 billion globally since 2016. In 2020 alone, IC3 received 19,369 BEC complaints, resulting in losses of over $1.8 billion.
- Why is Business Email Compromise a serious threat?
BEC attacks can have serious consequences for businesses. Attackers can steal sensitive information, compromise financial accounts, and cause reputational damage to the organization. BEC attacks are also difficult to detect and prevent, making them a persistent threat.
Types of Business Email Compromise
- CEO Fraud
CEO fraud is a type of BEC attack in which attackers impersonate a high-level executive, such as a CEO or CFO, and send an email to an employee requesting a wire transfer or other sensitive information. The email may appear to be legitimate, often including the executive’s name, email signature, and company logo.
- Invoice Scam
In an invoice scam, attackers send a fake invoice to a business’s accounts payable department, requesting payment for goods or services. The invoice may appear to be from a legitimate vendor, but the payment details will lead to a fraudulent account controlled by the attacker.
- Account Compromise
In an account compromise attack, attackers gain access to an employee’s email account and use it to send fraudulent emails to other employees or customers. The emails may request sensitive information or ask for a wire transfer.
- Lawyer Impersonation
In a lawyer impersonation scam, attackers impersonate a lawyer or law firm and send an email to a business requesting payment for legal services or settlement of a legal dispute. The email may appear to be from a legitimate law firm, but the payment details will lead to a fraudulent account controlled by the attacker.
- Data Theft
In a data theft attack, attackers gain access to an employee’s email account and use it to steal sensitive information, such as trade secrets, customer data, or financial information.
How Business Email Compromise Works:
- Social Engineering Tactics
BEC attacks rely heavily on social engineering tactics, which are designed to trick employees into taking action that benefits the attacker. Social engineering tactics may include impersonation, urgency, and intimidation.
- Common Attack Vectors
Attackers use a variety of methods to carry out BEC attacks, including spear-phishing emails, malware, and password attacks. The most common method is spear-phishing emails, which are highly targeted emails that appear to be from a trusted source.
- Red Flags to Look Out For
Employees can help prevent Business Email Compromise attacks by being aware of common red flags, such as emails requesting urgent wire transfers, changes to payment details, or unusual account activity. Employees should also be wary of emails that use urgent language, misspellings or poor grammar, and requests for sensitive information.
- Case Studies
Numerous high-profile cases demonstrate the severity of the BEC threat. In 2019, a Lithuanian man was arrested and charged with stealing $100 million from Google and Facebook through a BEC scam. The man and his associates allegedly used fake invoices and fraudulent documents to trick the tech giants into transferring funds to fraudulent accounts.
Prevention and Mitigation Strategies:
- Employee Training and Education
Training and educating employees on the risks of BEC attacks and how to recognize and report suspicious emails is essential to prevent these attacks. Regular training sessions and simulated phishing campaigns can help raise awareness and reduce the risk of successful BEC attacks.
- Strong Password Policies
Enforcing strong password policies, including two-factor authentication and password managers, can help prevent password-based attacks and limit unauthorized access to email accounts.
- Two-Factor Authentication
Two-factor authentication provides an additional layer of security for email accounts by requiring a second factor, such as a biometric or token, in addition to a password.
- Encrypted Email Communication
Using encrypted email communication can help protect sensitive information from interception by unauthorized third parties. Encryption ensures that the contents of the email are only accessible by authorized parties.
- Vendor Management
Establishing strong vendor management policies, including conducting due diligence on vendors and verifying payment details before transferring funds, can help prevent BEC attacks that target vendors.
- Incident Response Plan
Having an incident response plan in place can help organizations quickly respond to BEC attacks and mitigate their impact. The plan should include procedures for identifying and containing the attack, notifying affected parties, and conducting a post-incident analysis.
BEC attacks are a growing threat to businesses of all sizes and types. By understanding the different types of BEC attacks, how they work, and implementing preventive measures, organizations can reduce the risk of falling victim to these attacks. Training and educating employees on BEC risks, enforcing strong password policies, using two-factor authentication, and having an incident response plan in place can all help protect against BEC attacks. By taking these steps, businesses can ensure that their email communication remains secure and that they are better equipped to defend against this persistent and evolving threat.