HSB Survey Shows Increase in Business Email Cyber Schemes
Hackers Scam U.S. Companies Out of Thousands of Dollars
U.S. businesses report an increase in suspicious emails, a survey released today by The Hartford Steam Boiler Inspection and Insurance Company (HSB) shows, and employees are taking the bait and transferring tens of thousands of dollars in company funds into fraudulent accounts.
Over half of business executives (58 percent) polled by Zogby Analytics for HSB, a leading provider of cyber insurance and services, said suspicious emails had increased in the past year.
More than a third (37 percent) of the organizations received an email from someone pretending to be a senior manager or vendor requesting payments.
Almost half of employees receiving those emails (47 percent) responded by transferring company funds, resulting in losses most often in the $50,000 to $100,000 range (37 percent) and rarely less than $10,000 (only 11 percent). Most businesses recovered at least some of the funds.
“Whether it’s a phishing scheme or malware, most cyber attacks start with an email,” said Timothy Zeilman, vice president for HSB, part of Munich Re. “Even companies that have information security training and fairly savvy employees fall victim to these deceptions.”
It pays off for cyber criminals. The FBI estimates global losses from Business Email Compromise schemes, also called email account compromise or CEO fraud, totaled $12.5 billion between October 2013 and May 2018, including at least $2.9 billion in the United States.
The scam is convincing because cyber thieves in many cases gain access to a business email account and assume the false identity of company managers. In addition to stealing business funds, individuals may be targeted to get W2 forms, Social Security numbers and other personal information.
Note for the editorial staff
Survey Methodology - Zogby Analytics was commissioned in 2018 by Hartford Steam Boiler to conduct a survey of 403 senior business executives in the United States — including chief executive, financial, information and technology officers. The businesses ranged from companies with revenues of less than $5 million and fewer than 50 employees to $200-$250 million and more than 500 employees. Based on a confidence interval of 95 percent, the margin for error was plus or minus 4.9 percentage points, meaning all other things being equal, the identical survey repeated would have results within the margin of error 95 times out of 100.
Hartford Steam Boiler (HSB), part of Munich Re, is a multi-line specialty insurer and provider of inspection, risk management and IoT technology services. HSB insurance offerings include equipment breakdown, cyber risk, specialty liability and other coverages. HSB blends its engineering expertise, technology and data to craft inventive insurance and service solutions for existing and emerging risks posed by technological change. Throughout its 150 year history HSB’s mission has been to help clients prevent loss, advance sustainable use of energy and build deeper relationships that benefit business, public institutions and consumers. HSB holds A.M. Best Company’s highest financial rating, A++ (Superior). Connect with HSB on LinkedIn, Twitter and Facebook.
Munich Re is one of the world’s leading providers of reinsurance, primary insurance and insurance-related risk solutions. The group consists of the reinsurance and ERGO business segments, as well as the capital investment company MEAG. Munich Re is globally active and operates in all lines of the insurance business. Since it was founded in 1880, Munich Re has been known for its unrivalled risk-related expertise and its sound financial position. It offers customers financial protection when faced with exceptional levels of damage – from the 1906 San Francisco earthquake to the 2017 Atlantic hurricane season and the California wildfires in 2018. Munich Re possesses outstanding innovative strength, which enables it to also provide coverage for extraordinary risks such as rocket launches, renewable energies, cyber attacks, or pandemics. The company is playing a key role in driving forward the digital transformation of the insurance industry, and in doing so has further expanded its ability to assess risks and the range of services that it offers. Its tailor-made solutions and close proximity to its customers make Munich Re one of the world’s most sought-after risk partners for businesses, institutions, and private individuals.
Zogby Analytics is an international research firm, providing clients with information and knowledge critical for making informed strategic decisions since 1984. The firm conducts multi-phased opinion research with state-of-the-art opinion research capabilities and objective analysis and consultation for banking and financial services institutions, insurance companies, hospitals and medical centers, retailers and developers, religious institutions, cultural organizations, colleges and universities, IT companies and federal agencies.
Hartford, Connecticut, October 10, 2018
The Hartford Steam Boiler Inspection and Insurance Company
One State Street
P.O. Box 5024
Hartford, Connecticut 06102-5024