Protect your company against CEO fraud: when the boss is not really the boss

Fraud is a considerable threat for many companies worldwide. No fewer than 1 in 3 businesses fear that they wouldn’t be able to function after a cyber-attack, an all-time high. What’s more, fraudsters are becoming more and more resourceful in their methods, which specifically target employees.
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In recent years, companies invest considerably in the security of their digital networks. As a result, hackers are forced to resort to other forms of fraud. CEO fraud is by far the best-known method: the fraudster poses themselves as a high-ranking manager (CEO, CFO, etc.) – via e-mail or telephone – and persuades ignorant employees to make an (international) payment or to release sensitive information. Typically, the urgent request runs counter to existing security procedures.

CEO fraud is on the rise in part due to the professional approach of the scammers. They have studied the company meticulously and know how its internal business processes run, which makes their false communication seems trustworthy. And they will stop at nothing. Nowadays, it is perfectly feasible to make phishing phone calls based on a voice recording sampled from a video on your own YouTube channel.

Remain vigilant at all times

The true extent and economic damage of this type of fraud is difficult to measure. After all, most managers prefer to keep the effects of this type of practice under the radar. Even so, Belgian companies easily fall prey. These fraudulent actions are relatively simple to perform and involve little risk for the fraudster. Conversely, this type of fraud is also easier to detect and prevent. A few smart interventions may suffice.

Henk Deraedt, director of Specialties & Banking Channel at Euler Hermes:  

How to prevent CEO fraud

 

  • Inform your employees about the risks.
  • Check the authenticity of e-mails that include payment requests.
  • Identify the gaps in your internal payment processes and tackle them.
  • Invest in strong security solutions for your IT systems.
  • Provide watertight reporting procedures and encourage your staff to apply them correctly.
  • Limit the amount of online available information so that fraudsters are less aware of your internal ins and outs.
  • Contact the police as soon as a suspicious action occurs.

 


Fraud insurance: comfort and risk management in one

The question is not whether your company will be affected, but rather: what will you do when it happens?

In that case, you want to be sure your company is sufficiently protected. That is precisely what fraud insurance provides. Euler Hermes covers various forms of fraud such as cyber theft, internal fraud and external fraud (including CEO fraud), in a single policy. Our protection comprises both the repair costs and the stolen amount. This approach minimises any damages.

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