Go to:

February 2019
< Jan Mar >
Leaguer Email Subscription

You are not currently subscribed. Click Subscribe below to receive the Leaguer email.

Tech Tuesday: Business Email Compromise/CEO Fraud
Tuesday, October 16, 2018 6:50 AM

Cyber Security Awareness Month

Cyber attackers have been using sophisticated phishing, social engineering, and other hacking tactics to convince employees with access to company finances to make wire transfers into criminals' bank accounts. These Business Email Compromise (BEC) scams target businesses working with foreign suppliers and businesses that regularly perform wire transfer payments.

The FBI says more than $12 billion in domestic and international losses between October 2018 and May 2018 were due to BEC scams. That's massive financial losses in 100 countries. In the U.S., more than 14,000 victims of BEC scams have been targeted across all 50 states.

"We have already received at least three reports from credit unions recently, including one request from the 'CEO' for a wire of $350,000," said Credit Union Resources IT Consultant Kevin Hood. "Luckily, the accounting staff caught it due to unusual grammar and language, and they reached out directly to the CEO.

In a BEC scam, fraudsters frequently target high-level executives by impersonating the company's CEO. They do their homework, researching publicly available information on the corporate hierarchy, staff, and payment patterns, and they use the method most commonly associated with their victim’s normal business practices. In most cases, victims use wire transfers, but others use checks as a common method of payment.

Once they criminals have gleaned enough information, attackers are able to craft convincing emails that appear to come from the company's CEO. Some of the messages might look like the following: "I'm heading out of town and will be out of reach for the next several hours, but we need to make a wire transfer ASAP to bank account #XXXXXXX."

An actual BEC attack occurred involving Xoom Corporation, an online, international wire-transfer provider based in California. Xoom reported an incident involving employee impersonation and fraudulent requests targeting the company’s finance department, and as a result, $30.8 million in corporate cash was transferred to overseas accounts.

How to Safeguard Against BEC Scams

The FBI's tips on protecting against a BEC scam can help prevent financial fraud or a data leak:

  • Verify email communication or requests over a different channel, such as in person or over the phone.
  • Use a second form of verification for wire fund transfers.
  • Flag emails with extensions similar to company email domain names.
  • Flag email communications where the reply email address is different from the from email address shown.

What Victims of a BEC Scam Should Do

The U.S. Chamber of Commerce. Advises victims of BEC scams to respond immediately. Acting within one or two days means the company might be able to recover the stolen money.

"These scams normally try to create a sense of urgency and state that the CEO is in a meeting or at a conference and will be unavailable," said Hood. "Credit unions should have processes in place to verify a request such as this, no matter the sense of urgency communicated in the email."

If you have additional questions about cybersecurity, please contact Credit Union Resources at 800-442-5762.

Stop the Data BreachesNational Cyber Security Awareness Month is observed each October since its inception in 2004 in the U.S. Cyber Security Awareness Month encourages vigilance and protection by all computer users.

Credit Union Resources is a wholly owned subsidiary of Cornerstone Credit Union League.


Security Resources at Your Fingertips

As technology changes, every credit union faces new security issues. Let Credit Union Resources help you stay on top of it—your future could depend on it. Our team of technology professionals provides guidance on compliance, shares best practices, and performs audits. We have a vested interest in your success, and your cybersecurity matters to us. To find out how we can help you manage cybersecurity and operational risks, contact:

Idrees Rafiq
800-442-5762, ext. 6799

Deanna Brown
800-442-5762, ext. 6464