Here’s What You Should Know About Business Email Compromise (BEC)

According to FBI estimates, the cost of business email compromise attacks in the ten years up to 2023 amounts to around $55.5 billion. No enterprise is immune to this cyber risk, which has rapidly grown in sophistication (and numbers) in recent times.

“Because of the prevalence of BECs, it’s not uncommon for organizations to handle these types of incidents on their own if they believe there hasn’t been too much damage,” says Brandy Griffin, cyber service delivery manager for Avalon Cyber.

But many businesses still lack a proper understanding of how these attacks work and, importantly, what organizations could do to avoid them in the first place.

This article is an educational guide for you and your team to learn more about BEC so you can create a safer business environment.

Business Email Compromise: Here’s What Is at Risk

Let’s first look at what BEC involves. It is a type of cyberattack where bad actors mimic a legitimate person or entity via email to trick a business (i.e., an unsuspecting employee) into giving away money or sensitive data.

For example, someone could imitate a senior executive, like the finance director of your company, to dupe a junior employee into sharing confidential financial information that is only accessible to a handful of people.

Or a criminal could impersonate one of your regular vendors and email your finance department to direct payments to a fraudulent account.

Note that in a BEC attack, fraudsters can impersonate anyone known to an organization, from an investor to a customer.

To make this scam work, they will often use a spoofed email ID that resembles the one used by the individual or entity they are posing as. In some cases, they may even hijack genuine email accounts using hacking, phishing, or malware.

Now, to get to the real question—what does your business stand to lose if you fall for a BEC? Mostly money, when the scam has financial motives.

If data is involved, things can get riskier. For instance, bad actors could use BEC to steal valuable data (say, account passwords) and sell it on the dark web, compromising your business security. Scammers can also achieve this by downloading dangerous files through email attachments or links.

Either way, the outcome is the same. A customer database breach, for instance, can seriously hurt your business reputation. On top of that, it could erode your market competitiveness and land you in trouble with regulators, too. Then, there are the indirect financial repercussions of dealing with an incident, like the costs of lawsuits, compensation, security upgrades, downtime, and recovery.

How Can You Identify a BEC Attack?

If the prospect of falling for a BEC threat is beginning to worry you by now, your reaction is certainly justified.

But the good news is, many of these attacks have underlying traits that could easily give them away to anyone paying attention.

Some of the common characteristics to keep an eye on include:

An Unfound Urgency

As much as BEC relies on building trust, it also counts on creating a sense of urgency to get the email receiver to respond in a hurry without checking facts.

Unusual Requests

This could mean asking for a sudden wire transfer or some sort of confidential information without much explanation.

Language Mistakes Atypical to the Sender

Are there spelling errors that seem uncharacteristic of the email sender? Maybe there are words and phrases you have never heard them use. All these are likely signs of an impersonation scam.

Typos in the Email Address

Spoofed email IDs will closely resemble the legitimate ones they are mimicking. But they won’t be identical. If you are attentive, you might notice an extra character or one that’s missing.

Dissimilarities in the Email Signature

During impersonation frauds such as BECs, scammers would follow the typical email signature elements (like fonts, formats, and designs) of the original company. But they are bound to make a mistake that could give away an imposter.

What Can You Do to Minimize BEC Threats?

Unfortunately, knowing how to identify BEC attempts is not enough to keep your business safe.

There are specific steps you must take to mitigate their threats before it is too late. These include:

Establishing Business Protocols and Policies

For example, create clear policies and procedures covering data sharing, data access limits, payment processing, vendor verifications, and other critical aspects of your enterprise. These are essential for curbing process loopholes that scammers could exploit and lessening the risk of falling for a BEC fraud.

Setting Up Security Barriers

At a bare minimum level, every business must have air-tight passwords, two-factor authentication, and biometric verifications to safeguard data. Using anti-malware software that could scan email attachments, detect spam, warn you of malicious sites, and provide an extra layer of much-needed protection is also important for combating BEC.

Training Your Teams

How can your staff detect an email imposter? What measures should they follow to verify business-critical email requests? Why should they avoid links and attachments? There’s a lot you must train your teams on to gear them effectively to beat BEC threats. But training should be an ongoing process to keep data security on top of their minds.

Reporting Threats

To tackle BEC attacks on time, employees must escalate each and every incident, no matter how insignificant. This means alerting the IT team and other key stakeholders. If you suspect an actual BEC attempt, make sure you report it to the Federal Trade Commission and the FBI’s Internet Crime Complaint Center with proper evidence to help investigate.

To Recap

In 2024, 70% of organizations were subjected to a BEC attack. This type of cyber threat can be pretty lucrative for criminals and painfully costly for enterprises, especially those of small to medium size.

The fact remains that BEC is a highly targeted risk that increasingly relies on social engineering and AI to mimic credible sources.

But it doesn’t mean you can’t thwart them. With the right approach to cyber security, you can lower your company’s exposure to business email compromise attempts.

Implementing clear processes and guidelines to minimize risks, strengthening security infrastructure and related activities, building awareness through employee training, and reporting potential threats without delay are pivotal for this.