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Account Takeover (ATO) – All You Need to Know

Account Takeover Fraud has been around for the last several years, and many banks and e-commerce platforms have had to deal with it. Statistics show that there has been a 300% increase in account takeover fraud, with businesses and individuals losing large sums of money. It involves using another person’s login credentials to make withdrawals and unauthorized purchases on different websites.

They can make many purchases and withdrawals before you realize that you have been a victim of an account takeover attack. If your customers are attacked in this manner, it can be terrible for your business. You will have problems retaining your current customers, attracting new ones, and it will cost you a large amount of money to clean up and enhance your security. Bear in mind that account takeover fraud is similar to identity theft in that the attacker takes over your identity to withdraw or use your money.

Account Takeover Methods

Hackers use a variety of methods to gain access to customer accounts. Bear in mind that login credentials are sometimes published on the dark web. Attackers can use that information to try and access your account. There are several vulnerabilities they can exploit if they have purchased or copied the information online. For example, if you use the same password everywhere, they are bound to get into your account. Accounts with weak passwords are vulnerable to credential cracking.

In case the company does not have the technology to identify and stop takeover attempts, attackers may succeed. Bear in mind that hackers are constantly refining their methods, and therefore you should ensure that you update your cybersecurity. Here are some of the ways that hackers can gain access to your accounts.

Malware Replay Attacks

Malware attacks are popular with hackers. Malware refers to malicious software that can help attackers gain access to account information or damage your device. Hackers create malicious software and send it to unsuspecting people via email. The emails request users to click on a link or download an attachment to verify personal information. Customers who follow these instructions will install malware without realizing it.

After the malware is installed, the attacker can choose to steal credentials or use a replay attack. When they steal your login information, they will use it to access your accounts and take over. With a replay attack, hackers capture HTTP data sent to banks or other financial institutions, manipulate it to favour them and then resend it. For example, they can change a request to view your balance page to a request for a wire transfer. You can end up losing a lot of money during such an attack, but here are several signs that you have malware in your network.

  • Compromised system performance
  • Unusual increase in traffic
  • Strange error messages
  • Suspicious emails sent to your accounts
  • Unusual pop-ups and ads

If you notice any of these warning signs, it is in your best interest to have an expert check your network and devices for malware.

Social Engineering

Social engineering is a clever tactic used by attackers to exploit human psychology and trick users to divulge personal information. They will impersonate your contacts, masquerade as institutions such as banks or mimic partner branding. The information you reveal will be used to access your account or for credential cracking. If you run a company, here are some of the signs that someone is targeting you.

  • You receive suspicious information and payment requests.
  • Unsolicited text and email messages
  • There are suspicious customer support inquiries towards your clients, such as requests to confirm login details.

Credential Stuffing

Credential stuffing involves the use of bots accessing a host of platforms and websites at the same time using stolen credentials. They will try several different logins on many accounts to find the ones that work. Bear in mind that this practice is favored by the fact that people tend to reuse passwords. Therefore, attackers are bound to find accounts that match the credentials that they have.

When they access your account, they will withdraw your funds or use them to make purchases online. Here are some warning signs that your business is under attack.

  • Fluctuating increase in traffic.
  • Increase in the number of failed login attempts
  • Increased number of account logins
  • Fictitious usernames trying to get authentication
  • Increase in bounce rates.

There are many other account takeover methods, but it is essential to understand that account takeover fraud is a process and not a single event. It involves the following steps.

  1. Infection

It involves using social engineering techniques such as pop-ups, malspam and bots to infect machines in your network.

  1. Misappropriation

When criminals gain access to your system, they steal login details and personally identifiable information.

  1. Transaction

Attackers can choose to use the information for fraudulent activities or sell it on the dark web.

  1. Validation

Attackers validate the stolen information to ensure that it can be used for account takeover fraud.

  1. Observation

The fraudsters will monitor the accounts they intend to take over and choose the right moment to strike.

  1. Execution

The attackers log in to the account and engage in unauthorized activity for their financial gain.

Account Takeover Fraud Prevention

Use the following steps to prevent account takeover fraud.

Password best practices

One of the best ways to prevent account takeover fraud is to ensure that your employees learn password best practices. They will be able to use these to create strong work and personal passwords. Ensure that you emphasize that a strong password includes uppercase and lowercase letters, has alphanumeric characters, and is changed frequently.

Use Password Management Tools

Consider adding a password management tool like LastPass or 1 Password to intensify security. Such tools ensure that employees do not repeat passwords and enhance online safety.

Execute Two-factor Authentication

Two-factor authentication adds a second step to the login process that is bound to stop attackers. You can choose to send a unique code via SMS or answer a security question or provide biometric data such as fingerprints.

It is essential to take steps to protect your company, customers and employees from account takeover fraud. Make sure that you enhance your company’s cybersecurity using the methods mentioned above.



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