Account takeover fraud can wreak havoc on businesses of all sizes and types. It can result in unauthorized credit card purchases, compromised login information, and stolen identity data.
While it is impossible to stop every instance of ATO, taking the proper precautions can help prevent this cybercrime and mitigate its impact. It includes practicing password hygiene, multifactor authentication, and recognizing suspicious activity.
Create Strong Passwords
Account takeover fraud occurs when criminals use stolen credentials to access an individual’s account. Malware, phishing, and social engineering are the most popular attack methods, but hackers are always coming up with new ways to steal money more quickly and effectively.
One way of account takeover fraud prevention is to enforce strong password policies. Creating long, complex, and unique passwords can reduce the likelihood of credential stuffing and brute-force attacks succeeding. Enabling multifactor authentication, such as SMS or code verification, also helps prevent attackers from taking over accounts.
Password security also includes:
- Preventing employees from using previously compromised passwords.
- Keeping passwords on file.
- Utilizing services such as LastPass or 1Password to manage passwords.
These tools help protect users against account takeover by ensuring they have not used the same password across multiple accounts and by providing cryptographically secure storage.
Another essential strategy is to monitor and block new devices from accessing an account. By comparing new user credentials against a database of breached information, businesses can quickly detect when an existing account is being taken over. By monitoring for multiple accounts changing to the same device model or other suspicious activity, such as a sudden increase in logins from new locations, businesses can immediately stop the account from being used for fraudulent activities.
Use Multifactor Authentication
Account takeover fraud (ATO) is a unique type of identity theft. Rather than stealing someone’s physical identity documents or financial information, it involves taking control of an online account and using it for fraud. It can include unauthorized purchases, transfers, and even identity theft.
To commit an account takeover, fraudsters must first gain illegitimate access to the victim’s login credentials. These can be procured through malware attacks, phishing scams, data breaches, or buying stolen dark web credentials. Once a hacker has the login information, they can easily make non-monetary changes and reset passwords on their victims’ accounts to keep themselves safe from detection.
The best way to protect against account takeover is to deploy a multifactor authentication (MFA) model that requires users to provide something they know, have, and are (like a fingerprint or iris scan). A recent report found that MFA blocking 99.9% of ATO attempts when paired with an on-device alert system can significantly reduce ATO risk.
However, it’s essential to balance security and customer convenience. Businesses using MFA only when necessary can enhance security and minimize customer frustration. Fortunately, adaptive authentication solutions can trigger MFA case-by-case based on perceived risk to reduce user friction while keeping fraudsters at bay.
Monitor Your Account Regularly
Even with a strong password and multifactor authentication in place, it is still possible for hackers to access your account. Attackers do not need to guess your password to get in; they can use stolen credentials from previous data breaches. This process is known as “credential stuffing.”
To combat this, you should monitor your accounts and reports to look for suspicious activity. For example, if you notice an automatic withdrawal you didn’t authorize or a new charge on your bank card, check your accounts regularly to catch any fraudulent activities. It will help you avoid losing money from scams and can also help you find areas where you can save.
It would help to keep track of your account balances and fees, such as ATM charges, overdraft fees, NSF fees, and monthly or annual account maintenance fees. One easy way to monitor your checking account is by scheduling a regular review of your transactions, such as once a week or month. It can help you prevent overdrafts or NSF fees and detect unauthorized purchases. It can also make it easier to dispute any fraudulent charges you feel should not be charged to your account.
Report Any Suspicious Activity
Account takeover fraud is a severe problem that can negatively affect individuals and businesses. It is crucial to comprehend how it operates and what to watch out for. It will enable you to recognize and report any suspicious activity to the authorities promptly.
Criminals use a variety of tactics to commit account takeover fraud, including social engineering and phishing, to trick victims into revealing sensitive information. They may also employ malware, such as keyloggers and password harvesters, to secretly record a user’s typing and keyboard activities. Then, they can steal the recorded data and login credentials from a victim’s computer or mobile device. They can even intercept credit and debit card details using card skimmers placed on ATMs or credit card machines.
Whether you’re an individual or a business, it’s critical to remember that account takeover fraud can happen at any time. Fraudsters are constantly innovating and developing new ways to breach security measures, so it’s essential to have a robust fraud detection system in place.
A robust identity verification solution can help you prevent account takeover fraud by verifying the identity of each user, monitoring unusual account behavior, and flagging suspicious activity. In addition, implementing a device recognition solution can allow you to track devices that have access to your users’ accounts and alert them when they are using unknown or unauthorized devices.