October 19, 2015
CEO fraud, also known as the business email compromise (BEC) scam, appears to be on the increase.
CEO fraud is a type of scam where fraudsters learn what they can about the inner workings of a company and then use social engineering techniques in an attempt to steal cash or gain unfettered access to a company's internal systems.
Finding out who the CEO, CFO and accounts department staff of a company are isn't particularly difficult these days; thanks in part to the increasing popularity of business-oriented social networks. The other way the scammers glean this information is through infecting staff computers with malware via email links.
In addition to having the insider knowledge on board, a domain name is registered - a typo version of the company's true domain that at first glance may appear correct.
Then it's just a case of the fraudster sending an email from what appears to be the CEO's email address; requesting a transfer of a large sum of cash, a password or other financially and/or commercially sensitive information to another party.
The ploy certainly doesn't work all the time, but when it does, the payoff for the fraudster can be huge.
According to recent statistics from the FBI, between October 2013 and August 2015 more than 8,000 business victims globally lost more than USD $1.2 billion.
"The BEC scam continues to grow and evolve and it targets businesses of all sizes," says the Bureau. "There has been a 270 percent increase in identified victims and exposed loss since January 2015."
Aside from fending off typosquatting, avoiding CEO fraud may be one of the reasons large companies register a bagful of misspelled domain names. However, for small to medium business; this can pose an overwhelming administrative and financial headache.
If you run a business, it may be wise to educate your staff about this sort of scam and ensure processes are in place to help prevent the transfer of funds or sensitive details to parties who are not entitled to them.
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