What is Business Email Compromise (BEC) Incident Response?

BEC incident response refers to the structured process of detecting, investigating, and responding to BEC attacks. These attacks typically involve an attacker gaining unauthorized access to a business email account or impersonating a trusted entity to deceive employees or stakeholders into transferring money, sharing sensitive information, or performing other actions that benefit the attacker.

Effective BEC incident response involves several key steps:

• Immediate incident response
• Investigation
• Communication
• Legal compliance
• Enhancing security measures
• Reviewing and updating incident response plans
• Insurance and financial considerations
• Long-term strategy and resilience building

What is a Business Email Compromise (BEC) Incident?

A BEC incident is a cyberattack where an adversary gains access to a corporate email account and imitates the owner's identity to defraud the company, employees, customers, or partners.

Unlike indiscriminate cyberattacks like phishing, BEC scams are targeted. They involve sophisticated social engineering and extensive research empowered by automation, artificial intelligence (AI) and machine learning (ML).

Key characteristics of BEC incidents include:

• Targeted Deception
• Email Account Compromise
• Financial or Data Loss

How to Identify a BEC Incident

Identifying a BEC incident requires careful observation and often relies on a combination of technology, user awareness, and cybersecurity best practices. Here are some common indicators and methods for identifying a BEC incident:

Suspicious Email Behavior

• Unusual Requests: Look out for unexpected or urgent requests from executives or high-level managers, especially those asking for sensitive information or urgent financial transactions.
• Changes in Language: BEC emails often have slight differences in tone, style, or phrasing that don’t match the sender's usual communication style.
• Spoofed Email Addresses: Attackers often use email addresses that look nearly identical to a legitimate one (e.g., using ".co" instead of ".com") or create free email accounts mimicking an employee or executive.

Unauthorized Account Access

• Unfamiliar Login Locations: Signs of login attempts from unusual geographical locations or devices can indicate that an attacker has accessed the account.
• Multiple Failed Login Attempts: This may suggest someone is trying to guess a password to gain unauthorized access.
• New Forwarding Rules: Attackers sometimes set up automatic forwarding to their accounts to monitor emails or exfiltrate data without the user’s knowledge.

Unusual Financial Requests or Payment Changes

• Altered Payment Instructions: Requests for payment details or account number changes, especially from vendors or partners, should be verified independently.
• Unusual Transfer Requests: Any email requesting an unusual or unexpected transfer of funds should raise a red flag and be confirmed via another method, such as a phone call.

Behavioral Anomalies Detected by AI and Machine Learning

• Email Analysis Tools: Advanced security tools use AI and machine learning to detect patterns and behaviors that deviate from the norm, such as unexpected language or email phrasing.
• User Activity Monitoring: Solutions like Microsoft Defender, Proofpoint, and other email security platforms use behavioral analysis to spot unusual actions, such as sending high volumes of emails or logging in from an unusual location.

Alert from Threat Intelligence Services

• Threat intelligence services can provide insights on the latest BEC tactics, potentially alerting organizations if their domain or employees’ emails are on a watchlist or have been seen in suspicious activities.

User Reports and Phishing Simulations

• User Awareness Training: Well-trained Employees can spot phishing attempts quickly. Encouraging users to report suspicious messages can serve as a frontline defense.
• Phishing Simulations: Regular simulations help users recognize BEC tactics and improve response times when identifying incidents.

Immediate Steps if a BEC Incident is Suspected

If a BEC incident is identified or suspected, take immediate action by:

• Informing your IT or cybersecurity team.
• Locking or resetting compromised accounts.
• Verifying unusual requests with a direct phone call.
• Reviewing email account activity for any unauthorized access or unusual forwarding rules.

Combining technology and vigilance is crucial in identifying BEC incidents before they cause significant harm.

Steps for Responding to a BEC Incident

The following actions will help mitigate damage caused by a BEC incident and strengthen your organization's defenses against future cyber threats.

Immediate Action and Containment

Isolate the Compromised System: The priority is to disconnect any affected systems from the network immediately. This step helps to contain the breach and prevent the compromise from spreading to other systems or networks.

Change Passwords and Security Details: Reset any compromised accounts' passwords and security credentials. It is also advisable to update credentials for accounts with similar passwords or security details to safeguard against further unauthorized access.

Notification and Communication

Notify Internal IT Security Team: Immediately report the incident to your IT or cybersecurity team. Prompt notification enables the team to take immediate action to mitigate the threat.

Inform Financial Institutions: If financial transactions are involved, contact relevant banks or institutions promptly. They may be able to halt or reverse any fraudulent transactions.

Contact Affected Parties: Contact individuals or organizations impacted by the compromise, such as employees, customers, or partners. Timely communication allows affected parties to take necessary precautions.

Investigation and Analysis

Conduct a Forensic Analysis: Engage IT professionals or a cybersecurity firm to conduct a forensic investigation. This step is essential for understanding how the breach occurred and assessing the full scope of the damage.

Identify and Document the Incident: Record all pertinent details about the incident, including when it was discovered, the suspected entry point, and the extent of the impact. Proper documentation is crucial for both internal review and external reporting if needed.

Legal and Regulatory Compliance

Consult Legal Experts: Seek legal professionals' guidance regarding legal obligations, such as notifying law enforcement or regulatory agencies. Understanding the legal landscape helps ensure compliance and avoid penalties.

Understand Regulatory Requirements: Be aware of specific regulatory requirements related to incident reporting. Some industries mandate reporting breaches to authorities or informing affected individuals within a set timeframe.

Recovery and Restoration

Restore Systems: Once the threat has been contained and is safe, restore affected systems to their operational state. Ensure all compromised components are thoroughly secured before going back online.

Implement Additional Security Measures: To prevent future incidents, enhance your email and network security by implementing multi-factor authentication, strengthened security protocols, and updated access controls.

Employee Training and Awareness

Conduct Training Sessions: Educate employees about BEC schemes, emphasizing the importance of vigilance and reporting suspicious activities. Regular training empowers employees to recognize and react to potential threats.

Update Security Policies: Ensure that all employees know the updated security policies and understand the procedures to follow in the event of a security threat. A well-informed workforce is a critical defense against cyber threats.

Review and Update the Incident Response Plan

Evaluate the Response: Review how it was handled after resolving the incident and identify any weaknesses or areas for improvement in your response strategy. A thorough evaluation enhances future response effectiveness.

Update the Incident Response Plan: Revise the incident response plan based on insights from handling the incident. An updated plan helps prepare your organization for quicker and more effective responses to future incidents.

Long-term Preventative Measures

Regular Security Audits: Conduct regular audits of your security infrastructure and practices. Audits help identify vulnerabilities and areas that need strengthening to prevent future attacks.

Ongoing Monitoring: Implement continuous monitoring systems to detect suspicious activities in real time. Ongoing vigilance is key to identifying and addressing threats before they escalate.

Insurance and Financial Considerations

Engage with Insurance Providers: If your organization has cyber insurance, contact your provider to discuss the incident. Understanding your coverage and available support can ease recovery and mitigate financial impacts.

Types of BEC Incidents

Most business email compromise attacks occur through email, although text messaging is an emerging avenue known as smishing (short for SMS phishing). Additionally, artificial intelligence is being used to facilitate voice-based attacks, called vishing. BEC incidents can take various forms, each utilizing different methods of deception and exploitation.

Understanding the common types of BEC scams helps organizations and individuals better recognize and prevent potential threats. Maintaining a high level of skepticism and verification regarding email communications, especially those involving financial transactions or sensitive information, is essential.

CEO Fraud: Attackers impersonate a high-ranking executive, like the CEO or CFO, and email an employee, usually in finance, instructing them to transfer funds to the attacker's account, often claiming it's a confidential or urgent transaction.

Invoice Fraud: Attackers impersonate suppliers, sending fraudulent invoices that seem legitimate. They control payments to their accounts by hacking legitimate vendors' emails or creating similar email addresses.

Account Compromise: An employee’s email account can be compromised to request payments to vendors, which can lead to payments being sent to fraudsters. The account can also gather sensitive information about the company or its clients.

Attorney Impersonation: Attackers impersonate lawyers, claiming to handle urgent matters. They usually target employees who can execute wire transfers. These communications commonly occur at the end of the business day or week to create urgency and limit verification opportunities.

Data Theft: Employees in HR or bookkeeping are targeted for data breaches when attackers try to obtain personally identifiable information (PII) or tax statements of employees and executives. This information can be used for further attacks, such as filing fraudulent tax returns.

Change of Bank Account Details: A common tactic involves impersonating a company executive or vendor to email the finance department, requesting a change in bank account details for future invoices. The attacker then controls the new account.

Gift Card Scam: The attacker, posing as an executive, asks an employee to purchase gift cards for personal or business reasons. The employee is instructed to send the gift card information, which the attacker then uses or sells.

Learning from a BEC Incident

To strengthen defenses against sophisticated threats like BEC attacks, organizations should prioritize learning and continuous improvement after an incident. A comprehensive BEC incident response playbook includes the following steps:

1. Conduct a Post-Incident Review: Gather stakeholders to assess all aspects of the incident. Review both technical and procedural responses to identify areas for improvement.
2. Identify Weaknesses: Analyze the breach, gather feedback, and compare responses with industry standards. Use findings to adjust security measures as needed.
3. Revise the Incident Response Plan: Enhance detection, containment, and recovery strategies. Update training, focus on phishing awareness, refine communication protocols, and clarify roles.
4. Implement Technological Improvements: Invest in or upgrade tools for better monitoring, detection, and response, including automation, AI, and ML. Adopt a Zero Trust model, consolidate tools, and integrate platforms for improved visibility.
5. Foster a Culture of Continuous Learning: Emphasize ongoing improvement in cybersecurity, encourage learning about new threats, and maintain an updated incident response plan. Promote a “shift left” mindset for proactive security in software development.
6. Preventive Measures and Best Practices:
   • Email Security: Use advanced filters to detect phishing and SPF, DKIM, and DMARC to prevent spoofing.
   • Access Control: Enforce strong passwords, multi-factor authentication (MFA), and regular access reviews.
   • Employee Training: Train employees in cybersecurity, conduct phishing simulations, and promote responsibility for security.
   • Incident Response Preparedness: Develop and regularly test a BEC-specific incident response plan involving IT, legal, HR, finance, and communications.
   • Technology Enhancements: Deploy advanced endpoint protection, data loss prevention (DLP), and network segmentation to prevent breaches. Implement Zero Trust to minimize risks from internal negligence.
   • Vendor and Partner Coordination: Evaluate vendor security, establish secure communications, and engage in joint security initiatives to strengthen overall security posture.

BEC Incident Response FAQs