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CEO Fraud: Phone Scam Overview



26 Jun 2017

Not all phone scams target individuals, some scams target major corporations. The FBI estimates that $2.3 billion has been lost to CEO fraud over the past three years. This fraud takes on various forms though the most common is through email.CEO Fraud Phone Scam

How the CEO Fraud Phone Scam Works

CEO fraud targets larger corporations as well as smaller businesses, in it the scammer will email or call an employee pretended to either be the CEO of a company or their assistant. They will instruct the employee to issue a wire transfer for payment to one of their suppliers.

In reality the person contacting the employee is not the CEO or their assistant and they’ve just told someone to wire a large amount of money directly to them. The employee typically doesn’t question the request because the scammer does a good job covering their tracks.

In some cases the scammer may even have gained access to the CEO’s email or other executive’s email via phishing. They will go through previous emails to determine which is the correct employee to reach out to, researching names and email formats. The scammer will then send the email via the CEO’s email, or they will create another email that is very similar to the CEOs.

In some cases instead of emailing the request, the scammer will call and give instructions to make the payment. They will state that it is urgent that the wire must be sent immediately, giving the employee no chance to question the action.

How to Avoid Business Scams

It’s important that everyone in an organization be aware of email phishing and the potential problems that an email hack can create. Educate your employees to check email requests for wire transfers carefully making sure there are no spelling mistakes. Make sure that they look closely at the email address to verify that it is the actual email address.

It’s also smart to set in place proper internal procedures for wire transfer requests. These safeguards will protect your employees and your business from becoming victims of phishing and wire fraud. Advise employees not to click any links that seem unfamiliar to them or

How to Report This Scam

If you feel that your company has been targeted by this scam or has been a victim of this scam you should report it to the FBI’s Internet Crime Complaint Center (IC3).

You can also report the phone numbers associated with this scam in CallerSmart’s phone tracing app for iPhone. This scam usually starts with an email hack via phishing. Stay on guard for text messages that include links that seem suspicious. You can lookup phone numbers for activity in both our app and our online phone book listings.

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