National Cybersecurity Awareness Month reminds us that cyber threats are an ever-growing danger, costing businesses of all sizes billions annually. Fraud is no longer limited to large corporations. Small- and medium-sized businesses (SMBs) and individuals are equally at risk. Staying ahead of the latest fraud trends and prevention strategies is crucial to protect your business from costly breaches.
In this article, we’ll explore five fraud trends that every business leader needs to know, along with actionable steps to avoid becoming a victim.
Table of Contents
5 Fraud Trends
1. Fabrication
Synthetic identity fraud is a type of identity theft in which criminals combine pieces of real personal data with false information to create an entirely new identity. They often start by stealing or purchasing a social security number on the Dark Web, then fabricate an associated:
- Name
- Date of birth
- Email account
- Phone number
The fraudster then legitimizes and nurtures the synthetic identity to build up lines of credit. After about 5months, once they can become an authorized user, they are ready to execute the ‘bust-out’ scheme.
The fraudster then maxes out all available lines of credit before dropping the identity. When the dust settles, creditors and businesses are left with dummy accounts filled to the brim with credit card maximums, loans, and cell phone/utility plans.
2. Ransomware
The word “ransomware” can send chills down the spine of any business owner, and for good reason.
Two cities in Florida were forced to pay over a million in aggregate bitcoin ransom, only after losing access to phone and email systems for multiple weeks. Municipalities are not alone.
A quick glance at data breach news headlines on any given week will reveal attacks on a SMBs as well.
3. Account Takeover (ATO)
Understanding the methods criminals use to target your business or industry is essential to building a strong cybersecurity strategy. However, the work of a CISO is often reactive.
They are tasked with managing a Security Operations Center (SOC) where analysts sift through vast amounts of data – trying to spot threats like finding a needle in a haystack. As crimeware and “spray-and-pray” techniques become easier to access and deploy, the frequency of breaches continues to rise.
At the SMB level, solving account takeover fraud is a shared responsibility across your entire organization. It requires dedicated teams and smart technologies that work together to protect your business more effectively and efficiently.
4. Universities
In 2019, three US universities disclosed data breach incidents within two days. However, this pales in comparison to the 2018 highlight. In March 2018, nine hackers breached 144 US universities, charged with stealing 31 terabytes of data worth roughly $3.4 billion in intellectual property.
University breaches have a ripple effect across all verticals and companies, driving awareness and raising cybersecurity standards for everyone.
5. Dark Web
In the first half of 2019, over 23 million credit and debit card details were sold in underground forums, with 64% originating from the U.S., followed by the UK and India. Stolen credit card data can be acquired for as little as $5, making it a lucrative and accessible target for cybercriminals.
Fast forward to 2024, and the scale of data breaches has only worsened, with over 1 billion records stolen so far, including medical and personal information.
Download a free copy of your guide today to learn about the Dark Web and how to protect your small business.
In 2024, healthcare giant Change Healthcare was hacked by a ransomware gang, exposing vast amounts of sensitive medical data. The breach occurred due to a lack of multi-factor authentication on a critical system, resulting in millions of Americans’ health information falling into the wrong hands.
This breach followed the U.S. Justice Department’s failed attempt in 2022 to block UnitedHealth Group’s acquisition of Change Healthcare, which raised concerns over the conglomerate’s access to sensitive health data. Telecom giant AT&T also suffered not just one, but two data breaches in 2024.
In April, hackers stole phone numbers and call records of over 110 million AT&T customers from data giant Snowflake’s systems. Though the breach didn’t include the contents of calls or messages, the metadata could be used to infer sensitive details, particularly for high-risk individuals like domestic abuse survivors.
Earlier in March, a separate breach saw 73 million customer records published online, including names, phone numbers, and addresses. It was only after the exposure of encrypted account passcodes that AT&T took action, resetting passcodes to protect millions of customer accounts. However, the company still doesn’t know how the data was leaked.
These breaches illustrate the growing risk once data reaches the Dark Web, where cybercriminals use stolen information to fuel fraud schemes that can be devastating for businesses and individuals alike.
Tips to Avoid Fraud and Protect Your Business
1. Strengthen Credentials
Create unique passwords and enforce multi-factor authentication for all network users.
2. Block Phishing Attempts
Install spam-filtering solutions with anti-phishing capabilities across your network.
Strengthen your organization’s defenses against advanced cyberattacks, like ransomware, by elevating phishing awareness with these expert tips and actionable insights.
3. Stay Prepared for Emerging Threats
Prepare for emerging threats, like cryptojacking attacks.
4. Use Monitoring
Use SMB security suites that include Dark Web monitoring.
5. Raise Cybersecurity Awareness
Involve all stakeholders in raising cybersecurity awareness across your organization.
6. Regularly Audit
Assess your organization’s information, protection levels, and access protocols regularly.
7. Verify Security
Ensure that all third-party vendors have cybersecurity protocols and policies in place.
8. Develop a Plan
Build a cybersecurity incident response plan (CIRP) and democratize key information.
9. Build Strategic Partnerships
Partner with a managed service provider (MSP), like Teal, to gain cybersecurity protection and awareness training for your employees.