Email-driven cyber claims rose nearly 25% in 2023: At-Bay

SOURCE: Zywave Cyber Front Page News; By Erin Ayers

Email-related cyber claim frequency jumped nearly 25% in 2023, with financial fraud accounting for 61% of all email claims last year and 72% for the first half of 2024, according to new data from At-Bay. “Email is the most common cyberattack vector for businesses, serving as the most prevalent initial entry point to launch financial fraud, ransomware, and data breach attacks,” said At-Bay in its report. By the firm’s definition, “email claims” can be caused by malicious emails with phishing links or malware, or attacks enabled by non-malicious emails. Manufacturing, finance, and law firms were the most targeted industries last year for email crimes. While the frequency of email incidents increased across all sizes of businesses, firms with revenues over $100 million saw a bigger uptick with three times more email claims than firms with under $25 million in revenue. Financial fraud, as the most common cybercrime committed over email, often involves business email compromise. BEC accounted for 63% of all financial fraud claims in 2023 and was split evenly between first-party compromises and third-party events where a vendor’s compromise resulted in a loss for an insured. “While the term financial fraud may sound like the result of a simple social engineering scam where a human is deceived into authorizing a mistaken transaction, the reality is 64% of financial fraud cases begin with a sophisticated hack into a user’s inbox,” said At-Bay. In 2023, financial fraud resulted in an average loss of $219,000 for At-Bay clients. The real estate industry saw the highest average loss at $434,000. “In the most severe cases, threat actors stole more than $5M, leading to not only devastating financial impact for those businesses, but also operational and reputational fallout as well,” said At-Bay. The firm added that between 2023 and first-half 2024, it had recovered $61 million in stolen funds for clients. However, cybercriminals aren’t solely interested in stealing  funds – At-Bay said 4.5% of these incidents involved stolen goods, with threat actors redirecting a wide range of products including Christmas decorations, beauty products, and paper towels.

Security rankings
The rise in email claims shines a spotlight on email security. Following up on previous research, At Bay studied solutions used by clients and found that businesses using Google Workspace experienced three times fewer claims than those using Microsoft 365. Across all email providers, Google Workspace users saw 54% fewer email claims on average while Microsoft 365’s claim frequency rose by 45% year over-year, as well. Businesses using Microsoft Exchange saw 55% more events than the average. At-Bay offered some context for these results – Microsoft 365 is more widely used than Google Workspace, for one. Additionally, Google applies some security features by default. Evaluating six email security solutions providers, At-Bay found that users of Mimecast saw 37% fewer email incidents than the average for a second year in a row. Users of Proofpoint saw improved security year-overyear, coming second in the study’s rankings. At-Bay also highlighted the human element at play in financial fraud. “Stopping malicious or suspicious emails and protecting against technical attacks is just one layer of defense, but it won’t prevent an employee from mistakenly sending a wire transfer to a fraudulent account because they did not follow the proper verification processes. However, a combination of email security, identity management and control, plus processes and training can lead to significantly lower risk,” said the insurance provider