business email compromise fraud

Eliminating the risk of business email compromise (BEC) attacks requires all parties to a financial transaction to pay close attention to email security, financial controls, and communication protocols.

By Jennifer C. Archie, Serrin Turner, and Tim Wybitul

Key Points:

  • The FBI has identified BEC fraud as the No. 1 financial threat to businesses in the US.
  • The FBI’s Internet Crime Complaint Center (IC3) estimates that global “exposed dollar losses” to BEC fraud has exceeded US$26 billion in the past three years.[i] In 2019 alone, the IC3 recorded 23,775 complaints about BEC, which resulted in losses worth some US$1.7 billion.
  • All parties to financial transactions must be aware of this fraud risk. Each should put in place not only appropriate security controls for email, but also financial controls for bank account and wiring-instruction verification.

What Is Business Email Compromise?

Business email compromise is a type of Internet-based fraud that typically targets employees with access to company finances — using methods such as social engineering and computer intrusions. The objective of the fraud is to trick the employee into making a wire transfer to a bank account thought to belong to a trusted partner, but that in fact is actually controlled by the fraudster.