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Account Takeover (ATO): The Means to a Dangerous End

Account Takeover (ATO): The Means to a Dangerous End

Identity Fraud
Author
Rahi Bhattacharjee
Rahi Bhattacharjee

Expert
Rahi Bhattacharjee
Rahi Bhattacharjee

July 6, 2024

Table Of Contents

Remember these tweets? When put together like this, it does seem apparent that it is a fraud. But when the news broke back in 2020, it sent everyone into a frenzy. At least 300 people had believed these and completed the transactions. Can you imagine the kind of power these fraudsters wielded? That is the far-reaching consequence and damage caused by account takeover frauds.

Image collage credit: Investopedia

 

Let’s dive deeper into what is an account takeover and its impact! 

Defining account takeover  

Account takeover (ATO) is a form of identity theft where cybercriminals gain unauthorized access to a user’s account, allowing them to steal sensitive information, make fraudulent transactions, or use the account for malicious activities. ATOs are the result of fraudulent activity. For example, consider the scenarios where 

  • An elderly person reveals an OTP to a malicious actor pretending to be someone from the bank. 
  • Fraudsters use bots to stuff credentials and passwords into a login portal, waiting for one of the combinations to click. 
  • A user sees their credit score destroyed because a loan was taken out using their credentials. 

These are different fraud tactics (Vishing, bot attack, and identity theft, respectively). But the result was an account takeover. The account of the legitimate user was taken over by the fraudster to use it for their own gains. 

Account takeovers are an essential strategy for the money mule fraud network. Criminals target the bank accounts of vulnerable people to move their illicitly gained money through the system without detection. They recruit these ‘mule’ accounts using stolen data, social engineering, malware, deepfakes, and more, and once they gain access, they transfer money into it and then later shift it into other accounts to lose any trail. 

Read our guide on how money mules become victims of account takeovers and its long-term impact. 

Account Takeover: The impact in numbers  

The impact of account takeover fraud
The impact of account takeover fraud

What drives the account takeover menace?

Account takeover attacks have become increasingly prevalent as cybercriminals continually find new ways to exploit vulnerabilities in digital systems. Several key factors contribute to the rise of ATO, highlighting the intersection of technology, user behavior, and cybercriminal tactics. 

  • Weak Passwords: Many users still rely on simple, easily guessable passwords, making it easier for attackers to gain access. 
  • Easy Availability of Stolen Data: Data breaches and the dark web provide cybercriminals with a wealth of stolen credentials. Social media has also become a breeding ground for ‘educational groups’ that sell stolen identities. 
  • Reduced Digital Literacy: Lack of awareness about cybersecurity practices makes users more vulnerable to social engineering attacks, phishing, and its variations. 
  • Rise of AI: Advanced AI technologies enable more sophisticated attacks, including automated credential stuffing, deep fakes, voice cloning, generative AI, and more

Related read: Unravelling types of fraud as we move through the customer journey

New-age industries that are impacted   

Account takeovers are a criminal's favorite way to do business. It not only has a financial impact, but it also exposes larger problems like the erosion of trust between consumers and financial service providers. When users feel their accounts are not secure, they may be less likely to engage with digital services.

 

There are other long-term damages like:

  • Operational disruption: ATO can significantly disrupt business operations. Dealing with the aftermath of an ATO attack, including fraud investigations and customer service issues, can drain resources and affect productivity.
  • Reputational damage: Companies that are victims of ATO often suffer reputational damage, which impacts their brand image and customer loyalty. 
  • Regulatory and legal consequences: Failure to protect customer data can result in regulatory penalties and legal actions, further compounding the financial and reputational damage.

Certain industries have been age-old victims of account takeovers. Banking, for one, has always been a prime target for cybercriminals due to the direct access to financial assets. Weak authentication mechanisms and legacy systems can make it easier for attackers to perform account takeovers. 

But, the past decade has seen the establishment of new-age industries that are driving global commerce. These industries are the new targets of fraudsters, causing damage on an economic scale. Here are a few of them: 

Industries affected by account takeover fraud
Industries affected by account takeover fraud

On social media, if you see someone posting an image of "rewards" after investing in a bitcoin scheme, and they urge their friends to also follow? They have most likely become a victim of a social media ATO. ATOs in smart home devices give them access to a wealth of data related to their eCommerce habits, lifestyle choices, private and vulnerable information, and so on.

Bureau: Your best bet for account takeover prevention 

One of the central tenets of account takeover prevention has to be inserting authentication mechanisms that rely on variables that cannot be replicated in any way.

Bureau's suite of fraud prevention solutions
Bureau's suite of fraud prevention solutions

With Bureau, you can leverage: 

  1. Device Intelligence

To gather geolocation data that will ensure the physical location of the device aligns with the user's typical patterns

  1. Behavioral Biometrics

To focus on unique user behaviors that are hard for attackers to mimic, like - typing patterns, mouse movement, touchscreen gestures, device handling, and voice recognition. Read more on our solution here.

  1. Alternate Data

To leverage alternate data sources that can add further verification layers, like analyzing social media activity, analyzing recent purchase history and transaction patterns, and trust-building digital markers like email age, presence on eCommerce sites, and more. 

Talk to us to know more about how our solution can help protect you from account takeover fraud. 

Schedule a free consultation with us here. 

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