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Hackers are taking advantage of the lack of security awareness among employees. Their limited knowledge about cybersecurity concepts are resulting in cyberattacks. One such type of cyber-attack which occurs due to lack of cybersecurity awareness is CEO fraud. Attackers impersonate high-level executives and trick employees into transferring money or revealing sensitive company details. To tackle such attacks, it requires proper security awareness training to reduce the chance of manipulation and human error.
What is CEO fraud?
CEO Fraud is a type of cyberattack in which hackers impersonate senior management or company executives to trick employees into revealing confidential data or demanding for money transfer. In this type of attack, cybercriminals target employees of finance, HR, or accounts payable departments. Attackers use techniques like spear phishing to attack specific people in the organization and take advantage of compromises and vulnerabilities in their accounts by using spoofing methodologies.
Tactics Used for CEO Fraud by Cybercriminals
- Phishing: Bulk emails are sent to deceive recipients by revealing confidential company data.
- Spear Phishing: This type of phishing attack involves targeting specific individuals of an organization using personalized information.
- Whaling: Hackers use Whaling attacks to target senior management and high-profile people to reveal sensitive organization details.
- Email Spoofing: Hackers use fake email addresses that resemble legitimate but intend to deceive employees.
- Social Engineering: This type of cyberattack involves manipulating human psychology and deceiving it to reveal private details such as pins, passwords, bank details, and private data.
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Real-Life Examples of CEO Fraud
Bengaluru IT Firm CEO Losses 2.3 crore in courier fraud(February 2024)
CEO of an IT Firm in Bengaluru was deceived into courier fraud where scammers posed as law enforcement officials and sent fraudulent emails and convinced him to transfer Rs 2.3 crore to avoid legal issues.
Reference: Economic Times
Delhi-Based Firms Defrauded of 7 crore
Cybercriminals spoofed the email addresses of CEOs of various Delhi-based companies, impersonated as real CEOs and convinced employees to transfer Rs 7 crore in fraudulent accounts.
Reference: Business Standard
The Four Stages of CEO Fraud
1. Research
Hackers gather details about the company and its executives through social media handles and online resources present on the internet.
2. Impersonate
Attackers create fake email addresses or spoof legitimate ones to impersonate as CEO of an organization.
3. Deception
The fraudulent emails sent by hackers appear to highlight the sense of urgency or appear legitimate to request confidential and financial details.
4. Exploitation
Employees believe the requests are genuine and transfer funds or share sensitive details of the company.
Prevention Strategies for mitigating the risk of CEO Fraud
- Providing cybersecurity awareness training to the employees to recognize CEO fraud and update them about fraudulent tactics used by cybercriminals can help to reduce these types of cyberattacks.
- Enabling MFA for email accounts can help in preventing unauthorized access and impersonation attempts.
- Organizations must conduct regular audits of financial transactions and communication which will help in identifying suspicious activities earlier.
- Running dummy phishing simulations for employees can help organizations test and improve employee response to fraudulent emails.
- For domain protection, registering similar domain names can help to prevent spoofing and impersonation techniques.
- Implementation of email authentication solutions such as Threatcop’s TDMARC, which uses SPF and DKIM techniques to detect spoofing attempts and offers advanced email filtering solutions.
- There is a need to limit the exposure of executives’ details on social media and websites to reduce impersonation attempts.
- Limit access to financial accounts, only trained people can access them.
- Use of monitoring tools to detect suspicious and unusual activities like irregular payment attempts or account logins.
- Organizations can encourage a culture of verification which empowers employees to question and specify suspicious attempts.
Conclusion
CEO fraud is one of the growing attacks that are used to target senior executives of an organization. Due to these types of attacks organizations need to face heavy financial losses and reputation damages. To stop such attacks there is a need to adopt a culture of security awareness and verification to reduce these types of cyberattacks. Providing proper security training, limiting access control, implementing domain protections and MFA can help to reduce the chances of these types of frauds and help organizations to be safe and secure over digital platforms.
Technical Content Writer at Threatcop
Milind Udbhav is a cybersecurity researcher and technology enthusiast. As a Technical Content Writer at Threatcop, he uses his research experience to create informative content which helps audience to understand core concepts easily.
