Business Email Compromise and its Impact on Your Business: Strengthening Cybersecurity and Awareness

Business Email Compromise (“BEC”) is a rapidly growing cyber threat that poses a significant risk to you and businesses worldwide. According to the FBI's Internet Crime Complaint Center, BEC was a costly cybercrime in 2023, with 21,489 complaints and $2.9 billion in adjusted losses.*

BEC attacks involve social engineering tactics aimed at deceiving you into divulging sensitive information or making fraudulent financial transactions. This article explores the impact of BEC on businesses, the common techniques used by cybercriminals, and the essential steps business must take to strengthen cybersecurity and raise awareness.

Understanding Business Email Compromise and its Techniques

BEC typically involves cybercriminals masquerading as trusted entities, such as a CPA or a vendor, to gain victims' confidence. These attackers exploit human vulnerabilities rather than relying solely on technical weaknesses. The following are common techniques employed by cybercriminals in BEC attacks:

• Phishing Emails: Attackers send deceptive emails, appearing to be from a legitimate source, requesting sensitive information or financial transactions. These emails often mimic bank logos, email addresses, and language to deceive recipients.
• CEO Fraud: Also known as "whaling," this technique targets high-level executives or business owners to authorize fraudulent transactions. The attackers impersonate CEOs or other top officials and request urgent fund transfers.
• Invoice Fraud: Cybercriminals alter or forge legitimate invoices to trick you into making payments to fraudulent accounts.

Impact on Businesses

Protecting your business from BEC attacks requires a joint effort from businesses and banks. The following strategies can help strengthen cybersecurity and raise awareness:

• Financial Losses: Businesses who fall victim to BEC attacks may lose substantial amounts of money. Once funds are transferred to fraudulent accounts, recovering the money becomes challenging and, in many cases, impossible.
• Identity Theft: BEC attacks often involve the collection of personal information, leading to identity theft and potential misuse of the victim's credentials for other criminal activities.
• Emotional Stress: Being a victim of BEC can be distressing, causing anxiety, fear and a sense of violation of privacy.

Strengthening Cybersecurity and Raising Awareness

Protecting your business from BEC involves a multi-faceted approach. Here are some recommendations businesses can implement:

• Staff Education: Businesses should educate their staff about BEC threats, warning signs, and safe practices. Regularly updating staff about the latest phishing techniques can help fight BEC attacks.
• Multi-Factor Authentication: Utilizing additional security measures to confirm valid payments or requiring an additional approver before releasing payments are ways to reduce your risk of releasing a fraudulent payment.
• Secure Communication Channels: Use secure communication channels when discussing any matters related to sensitive financial information. Businesses should adopt this practice internally as well, especially when sensitive information such as account details are included in images or text.

Summary

Business Email Compromise presents a serious threat to businesses, with cybercriminals continually refining their tactics to deceive and exploit unsuspecting individuals. As BEC attacks continue to evolve, it is imperative for businesses to prioritize cybersecurity measures and awareness. Businesses need to invest in employee training to respond effectively to red flags as it often requires awareness and action at the business user level to successfully prevent loss. Through such proactive measures, the impact of BEC can be significantly mitigated, paving the way for a more secure environment.

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* https://www.ic3.gov/Media/PDF/AnnualReport/2023_IC3Report.pdf

For more on protecting yourself from BEC, visit:
https://www.fbi.gov/how-we-can-help-you/safety-resources/scams-and-safety/common-scams-and-crimes/business-email-compromise