What Is a Business Email Compromise (BEC) Attack

Business Email Compromise (BEC) attacks are increasingly dangerous cyber threats targeting businesses worldwide. These attacks exploit weaknesses in email systems, using social engineering to trick employees into transferring funds, sharing confidential data, or exposing sensitive information. Understanding BEC attacks is crucial for organizations of all sizes, as these scams are responsible for billions in financial losses annually.

In this guide, we’ll dive into the details of BEC attacks, how they work, the different types, and how businesses can protect themselves.

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Table of Contents

1. What Is a Business Email Compromise (BEC) Attack?
2. How Does a BEC Attack Work?
3. Types of BEC Attacks
4. Examples of BEC Attacks in Real Life
5. Warning Signs of a BEC Attack
6. How to Prevent BEC Attacks
7. What to Do If Your Company Experiences a BEC Attack
8. Protect Your Business with SSL Dragon

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What Is a Business Email Compromise (BEC) Attack?

A Business Email Compromise (BEC) attack is a form of cybercrime where attackers use email fraud to manipulate an organization. By impersonating an executive, partner, or trusted colleague, attackers convince employees to make wire transfers, share sensitive information, or approve large purchases under false pretenses.

BEC attacks are effective because they rely on social engineering, which manipulates human trust rather than technical vulnerabilities. These attacks have become one of the most costly cybercrimes globally, impacting companies of all sizes and industries.

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How Does a BEC Attack Work?

BEC attacks involve a series of calculated steps designed to manipulate employees. Here’s how a typical BEC attack unfolds:

1. Reconnaissance: Attackers study the company’s public information, including staff roles, hierarchies, and common business partners.
2. Impersonation Setup: Using phishing emails or fake login pages, attackers may gain access to an employee’s email credentials or set up a similar-looking email domain.
3. Execution of the Attack:
   • Spoofing or Impersonation: Attackers send messages that appear to be from a trusted figure, like a company executive, client, or attorney.
   • Requesting Urgent Action: These emails often have an urgent tone, asking for immediate payments, wire transfers, or sensitive information.

A common method used in BEC attacks is email spoofing, where attackers send emails that appear to be from a trusted domain. Phishing and malware are also used to access employee login credentials, granting attackers ongoing access to the company’s internal communications.

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Types of BEC Attacks

There are several types of BEC attacks, each targeting different weaknesses in a company’s structure:

1. CEO Fraud. In CEO fraud, attackers impersonate a high-level executive, such as the CEO or CFO. They send urgent emails to employees, often in finance or accounts payable, requesting an immediate transfer of funds.
2. Account Compromise. Here, attackers gain access to an employee’s actual email account. They use this access to request payments or sensitive data from others within the company or from clients, posing as a trusted colleague.
3. Invoice Scams. Attackers send fake invoices, often impersonating a supplier or business partner. These invoices look genuine, complete with the company’s branding and payment details, tricking finance teams into transferring money to the attacker.
4. Attorney Impersonation. Attackers pose as legal representatives, usually during times of critical financial activity such as mergers or acquisitions. The attackers create a sense of urgency by referencing legal consequences if the employee does not comply with the request.
5. Data Theft. Sometimes, BEC attacks focus on stealing information rather than money. Attackers may request sensitive HR data, such as tax IDs or payroll information, which can later be used for identity theft or future attacks.

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Examples of BEC Attacks in Real Life

BEC attacks have led to severe financial losses for businesses worldwide. Here are a few notable cases:

• Ubiquiti Networks: The company lost over $46 million in a BEC attack in 2015, where attackers posed as employees and convinced the finance department to transfer funds to fraudulent overseas accounts.
• Toyota Boshoku: This Japanese subsidiary suffered a $37 million loss due to a BEC attack where cybercriminals impersonated a senior executive, requesting an urgent wire transfer.

These examples highlight the effectiveness and sophistication of BEC attacks, especially when they target high-level employees and the finance departments.

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Warning Signs of a BEC Attack

Recognizing the signs of a BEC attack can help employees respond promptly before damage is done. Here are some red flags to watch for:

• Unusual Requests from Executives: Emails from a company executive requesting urgent or large financial transactions, particularly if it’s out of their usual scope of work.
• Pressure to Act Quickly: BEC emails often carry a sense of urgency, pressuring the recipient to complete a task quickly to avoid some negative outcome.
• Suspicious Attachments or Links: Any unexpected email containing attachments or links, especially from an unknown or high-ranking source, should be treated with caution.

Being able to differentiate between legitimate and fraudulent emails can make a significant difference in preventing BEC attacks.

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How to Prevent BEC Attacks

Preventing BEC attacks requires a combination of technical safeguards, employee awareness, and strict protocols. Here are the most effective strategies:

1. Implement Email Authentication Protocols

Using protocols like DMARC (Domain-based Message Authentication, Reporting, and Conformance), SPF (Sender Policy Framework), and DKIM (DomainKeys Identified Mail) can help prevent attackers from spoofing your domain. These protocols verify the sender’s email domain, significantly reducing the risk of fraudulent emails reaching employees.

2. Employee Training on Phishing and Social Engineering

Regular training sessions on BEC and phishing attacks can greatly improve your company’s resilience to BEC attacks. Employees should be trained to:

• Recognize red flags in emails, such as unfamiliar links, typos, and requests for urgent transfers.
• Verify requests for sensitive information or transactions by contacting the sender directly.

3. Enable Multi-Factor Authentication (MFA)

MFA adds an extra layer of security, requiring users to verify their identity through a secondary method like a mobile app or biometric scan. By enabling MFA on business accounts, companies can reduce the chance of unauthorized access, even if an attacker obtains login credentials.

4. Use Secure Email Gateways and Encryption

Secure email gateways can identify and block phishing attempts, spam, and other potential threats. Email encryption ensures that sensitive information remains secure and unreadable if intercepted. Investing in high-quality email security software can provide an essential layer of protection against BEC attacks.

5. Establish a Verification Process for Large Transactions

A simple but effective policy is to require verbal or in-person verification for large transactions. Implementing a standard process, such as requiring two-person verification for large transfers, can help prevent unauthorized transactions triggered by fraudulent emails.

6. Regularly Update Security Software

Ensure all security software, operating systems, and applications are up to date to reduce vulnerabilities that attackers may exploit. Implementing automated updates can help streamline this process, ensuring you’re always using the latest and most secure software.

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What to Do If Your Company Experiences a BEC Attack

If your company falls victim to a BEC attack, immediate action is crucial. Here’s what to do if you suspect an attack:

Step 1: Contain the Breach

• Immediately isolate compromised accounts by disconnecting them from the network and changing login credentials.
• Notify the IT team so they can initiate an incident response plan and monitor for further suspicious activity.

Step 2: Report the Attack to Authorities

BEC attacks are serious crimes. Reporting to local and federal authorities, such as the FBI’s Internet Crime Complaint Center (IC3), can help recover lost funds and prevent future attacks. Law enforcement agencies have specialized teams that can assist in tracking cybercriminals.

Step 3: Conduct a Forensic Investigation

Working with cybersecurity experts or your IT team, conduct a thorough forensic analysis of the attack to identify how the attackers gained access. This helps pinpoint vulnerabilities and guide improvements in your cybersecurity practices.

Step 4: Implement Corrective Actions

Following an attack, use the lessons learned to strengthen your defenses. This may involve additional employee training, upgrading security measures, or revising company policies to prevent similar incidents in the future.

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Protect Your Business with SSL Dragon

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