Risk Factor CEO Fraud: To the Detriment of Companies


Again and again, there are cases of CEO fraud that cause high losses, sometimes in the number of millions. This particular scam always follows a similar pattern. An example:

A person, seemingly the CEO of a company, approaches an employee of another firm under the pretext of a very confidential company take-over by writing a confidential email. 

After a written exchange there is no doubt concerning the sender’s identity because the scammers use fake but convincing email accounts.

The approached employee does not question the request to transfer a certain high amount of money not only within a short time span but also in secret. In many cases, the money transfers actually happen. The scammers quickly forward the money to foreign bank accounts before the fraud victim even realizes what has happened.

Measures against CEO Fraud

But how can you protect your company from CEO fraud? The German Allianz für Sicherheit in der Wirtschaft (ASW) has published helpful guidelines on how to prevent CEO fraud. It is particularly important to raise awareness for this type of fraud, sensitize the departments within the company and establish control mechanisms.

It is of utmost importance to verify email addresses. In many cases, fake addresses only look authentic on first glance. But the best way to prevent CEO fraud is the direct approach: By using a known and verified phone number to contact the email’s supposed sender and verify their identity, CEO fraud attempts can be easily uncovered. The employees in question should not let themselves be pressured into any actions. Despite the sender’s call for confidentiality, they should always inform their superiors or even security authorities.

What corma Can Do for Your Company

Bigger companies usually have their own specialists for corporate security, who can handle cases of CEO fraud. Smaller and middle-sized companies do not have that luxury. As an external service partner corma can help these companies, both in suspected cases of fraud and by helping to set up preventive measures.

We offer business consulting on equal footing concerning the following subjects:

  • Reasonable IT solutions to prevent CEO fraud
  • Management of the company's publicly available information and tailor-made monitoring
  • In-house anti-fraud training sessions to raise awareness among the employees
  • Preventive monitoring of similar domain names (e. g. different spelling) that could be used for fraudulent activities
If you want to learn more about CEO fraud and look for effective solutions, we are happy to hear from you!
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