In today’s digital banking world, small businesses face growing threats from cybercriminals. One of the most dangerous scams is Corporate Account Takeover (CATO), a type of fraud where thieves gain access to a company’s bank accounts and make unauthorized transactions. At BankFive, we’re committed to helping small business owners understand the risks of CATO and take steps to protect their finances. Let’s take a closer look at what Corporate Account Takeover is, how it happens, and what you can do to safeguard your business.
What Is Corporate Account Takeover?
Corporate Account Takeover is a form of cybercrime where fraudsters steal login credentials and access a company’s online bank accounts. With access to the accounts, they can transfer money, change account settings, and even lock out the owner. Cybercriminals use a variety of tactics to break into business bank accounts. One common method is phishing, where fake emails or websites trick employees into revealing their login credentials. Another is malware, which is malicious software secretly installed on a computer to capture passwords and other sensitive data. Additionally, hackers often engage in credential theft, either by purchasing stolen usernames and passwords on the dark web or by exploiting weak or reused passwords to gain unauthorized access.
Small Businesses are Especially Vulnerable
Small businesses are often targeted by cybercriminals due to limited cybersecurity resources and the absence of dedicated IT teams or advanced protection tools. Small businesses may also have fewer checks and balances in place for financial transactions than larger companies, making them attractive to fraudsters.
Warning Signs of Account Takeover
Knowing the signs of a possible account takeover can help you act fast. Here are some red flags to watch out for:
The good news is that there are several proactive things you can do to help reduce the risk of your business being impacted by Corporate Account Takeover.
If you think your business account has been compromised, time is of the essence. Act as quickly as possible and follow these steps:
What Is Corporate Account Takeover?
Corporate Account Takeover is a form of cybercrime where fraudsters steal login credentials and access a company’s online bank accounts. With access to the accounts, they can transfer money, change account settings, and even lock out the owner. Cybercriminals use a variety of tactics to break into business bank accounts. One common method is phishing, where fake emails or websites trick employees into revealing their login credentials. Another is malware, which is malicious software secretly installed on a computer to capture passwords and other sensitive data. Additionally, hackers often engage in credential theft, either by purchasing stolen usernames and passwords on the dark web or by exploiting weak or reused passwords to gain unauthorized access.
Small Businesses are Especially Vulnerable
Small businesses are often targeted by cybercriminals due to limited cybersecurity resources and the absence of dedicated IT teams or advanced protection tools. Small businesses may also have fewer checks and balances in place for financial transactions than larger companies, making them attractive to fraudsters.
Warning Signs of Account Takeover
Knowing the signs of a possible account takeover can help you act fast. Here are some red flags to watch out for:
- Unusual Login Activity: Login attempts from unfamiliar IP addresses, devices, and locations can be a red flag, as can login attempts that happen at strange times—like late at night.
- Unauthorized Transactions: Be on the lookout for wire transfers or ACH payments you didn’t approve, or changes to payment instructions.
- Changes to Account Settings: Unexpected updates to contact info, passwords, or security settings could indicate that your account is being accessed by someone else. The addition of new users or administrators you don’t recognize is also a red flag.
- Suspicious Emails or Messages: Messages that request urgent financial actions or that come from strange or slightly altered email addresses could be phishing attempts.
- Alerts from Your Bank: Notifications about unusual activity, password changes, large transactions, or account access should be reviewed immediately.
- Locked or Disabled Accounts: If you suddenly can’t access your online account, it could mean that someone else has taken control of it.
The good news is that there are several proactive things you can do to help reduce the risk of your business being impacted by Corporate Account Takeover.
- Protect Your Online Environment. Safeguarding your digital space should be just as important as protecting your physical location or cash. Always use a secure internet connection when conducting business, encrypt sensitive data, and keep your software updated. Use strong, unique passwords for all of your business systems and tools, and change them often. You should also enable multi-factor authentication (MFA) wherever possible.
- Educate Your Employees. You and your team are the first line of defense against Corporate Account Takeover. A strong security program paired with employee education about the warning signs, safe practices, and responses to a suspected takeover are essential to protecting your company and customers.
- Monitor Your Accounts Frequently. Check your bank accounts on a regular basis. If you notice any unauthorized transactions or account changes you didn’t make, contact your bank immediately.
- Take Advantage of Fraud Prevention Tools. Talk to your bank about fraud prevention tools that can strengthen your account security. These might include things like Positive Pay, device authentication, multi-person approval processes, and batch limits.
- Understand Your Responsibilities. Your account agreement with your bank outlines the security measures you’re expected to take as a business. It is critical that you understand and implement these safeguards. If you don’t, you could be liable for losses resulting from a takeover. If you have questions about your responsibilities, contact your business banker.
If you think your business account has been compromised, time is of the essence. Act as quickly as possible and follow these steps:
1. Contact Your Bank Immediately. Let them know what’s happening so they can freeze the account and stop further damage.
2. Freeze Affected Accounts. This will help to prevent additional unauthorized transactions while the takeover is being investigated.
3. Notify Law Enforcement. File a police report to document the crime and help with investigations.
4. Conduct an Internal Investigation. Review how the breach happened and the extent of the damage.
5. Strengthen Security Protocols. Update passwords, review access controls, and improve employee training to prevent another takeover.
Corporate Account Takeover is a serious threat, but with the right knowledge and tools, small businesses can defend themselves against financial loss and reputational damage. By recognizing the warning signs and implementing strong security practices, you can significantly reduce your risk. For more tips on safeguarding your business against online threats, visit https://www.bankfive.com/business-security.