A nonprofit publication of the Kentucky Center for Public Service Journalism

BBB Trends: Is that email really from your boss? A closer look at business email compromise scams

An in-depth investigative study by BBB finds that business email compromise scams are skyrocketing in frequency and have cost businesses and other organizations more than $3 billion since 2016.

Business email compromise fraud is an email phishing scam that typically targets people who pay bills in businesses, government and nonprofit organizations. It affects both big and small organizations, and it has resulted in more losses than any other type of fraud in the U.S., according to the Federal Bureau of Investigations (FBI). 

The study – Is That Email Really From ‘The Boss?’ looks at the prevalence of email scams and the criminal systems that perpetuate them. It digs into the scope of the problem, who is behind it, the multi-pronged fight to stop it and the steps consumers can take to avoid it.

BBB’s report finds that the average email compromise loss involving wire transfers is $35,000, while the average loss involving gift cards is $1,000 to $2,000. However, the cost to businesses can be much higher: Google and Facebook lost more than $100 million to email fraud before the perpetrator was arrested in 2017.

Smaller businesses such as real estate agents also report losing thousands of dollars to this scheme affecting not only the business but also their clients. Businesses and other organizations are encouraged to take technical precautions such as multi-factor authentication for email logins and other changes in email settings, along with verifying changes in information about customers, employees or vendors. The report also urges culture and training changes in organizations – namely, confirming requests by phone before acting and training all employees in internet security.

If an organization suspects it has been a victim of email fraud, call the bank to stop the payment and report it to the FBI. Then, take immediate steps to report it to scamtraker.org.

The full report can be found on www.bbb.org/scamstudies

Sandra Guile is the Public Relations Specialist for BBB. She promotes BBB’s message of marketplace ethics through public speaking engagements, presentations, media relations, press releases, web content, and other written materials. Your BBB is located at 1 East 4th Street Suite 600 Cincinnati, Ohio 45202 – to reach the office, call 513-421-3015.

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