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When trust turns sour: The threat of social engineering attacks to your institution

When trust turns sour: The threat of social engineering attacks to your institution

Hunter S. Thompson once said, “I am a generous man, by nature, and far more trusting than I should be. The real world is risky territory for people with generosity of spirit. Beware.”

This quote could not be truer or resonate more today, especially when discussing the topic of social engineering attacks in the financial sector.


“The real world is risky territory for people with generosity of spirit” is incredibly accurate if you think about it. The unfortunate truth is that, as humans, our natural inclination is to trust and to look for the good in people—particularly in the case of individuals working in customer service positions. Unfortunately, this makes us easy prey for fraudsters. Trusting, helpful human spirits are the low hanging fruit. Attacks aimed at humans don’t require an attacker to place malware on a device or inject anything into a browser—often all it takes is a simple phone call into the back office. With just a few nuggets of information about an end user, fraudsters often have all of the necessary tools to convince a financial institution’s (FI’s) employee to readily “help” them.

While we all would like to think that our staff will not fall for such schemes, I’d caution that the shift in transaction amounts occurring in such attacks are raising fewer and fewer eyebrows. Why? In many cases fraudsters are moving toward initiating smaller transactions—generally less than $10K—rather than high-dollar amount wires, so as not to gain unwanted attention. These smaller dollar amount transactions are bounced through multiple mule accounts before ultimately leaving the country.

Particularly where social engineering is concerned, we have seen a 63 percent increase in fraud cases reported to Q2, when comparing only the first quarter of this year to all of 2014. That’s a dramatic upsurge in just three months, as compared to
the prior 12.

At a high level, these reports consist of phone calls, faxes or emails into the back office attempting to generate transactions or change sensitive information on an end user’s account. And, with the amount of personal and company information available and accessible on the internet, the reality is that these scams are not difficult to pull off.

As we look to the future, a combination of factors will continue to contribute to fraudsters’ use of social engineering as an attack of choice, to name just a few:

  • The shift toward Europay, MasterCard and Visa (EMV), and the reduction of fraud via the reselling of reproduced cards.
  • The continued evolution of anomaly detection anti-fraud tools catching transactions generated online.
  • The fact that these attacks really are just too easy, as they rely simply on trusting human nature.


Building a successful defense strategy for these types of attacks ultimately comes down to consistent training and testing of employees’ reactions to a variety of challenging scenarios. The Q2 Security team has built a targeted, customized Social Engineering Testing service designed to pressure employees in scenarios we’ve seen used in actual fraud cases. The reality is that we truly don’t know how staff will react to these types of schemes until they are faced with the situation in a real-world scenario. Trust itself is not a bad thing, however, encouraging a culture of “trust, but verify” may just pay off in the long run.

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