How fraudsters deceive banks and individuals through CEO fraud.

by Patrick Müller

26.04.2023

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More money, different problems:
How fraudsters deceive banks and individuals through CEO Fraud to get their hands on the loot.

In my last ➡️ post on CEO Fraud, I discussed the various forms of identity theft and fraud within companies.

When fraudsters succeed, the transfer is made, and the money leaves the company. Now the question arises: what about tracking or reversing the transaction?

Let's look at the variations of the recipients

In the past, unsuspecting victims were typically instructed to transfer the money to foreign bank accounts. Due to existing reporting requirements and awareness, these attacks were often uncovered in time.

As a result, newer variations have emerged, where the money is to be transferred to a domestic or intra-EU bank account. For these accounts, different scenarios exist:

The account was created with a fake identity.
An account was opened in the name of a real person who is an unwitting or deceived victim of the fraud.
The account belongs to a real person, and the fraudsters gained access to it through other fraudulent activities.
The account belongs to a real person with no access by the fraudsters, who unknowingly acts as a money mule.

What do these variations have in common?

An intermediary bank account is used between the company’s account and the fraudster’s account. By the time the company realizes the fraud, the money is no longer in the account of the additional victim but has already been forwarded, often in small amounts, to foreign accounts. Tracking or recovering the money is almost impossible.

New and future scenarios

New and future scenarios are expected, as fraudsters will continue to need bank accounts to carry out their schemes. Unfortunately, we are witnessing a form of fraud industrialization, with criminals specializing in providing bank accounts for fraudulent purposes.

In a particularly alarming variation, victims unknowingly do all the work themselves. They are tricked into believing that they are testing video identification services for banks as part of their new employment. In reality, they are unknowingly verifying numerous bank accounts in their own name.