Last month the FBI’s Internet Crime Complaint Center (IC3) released its 2018 Internet Crime Report. There are many eye-popping statistics included. But let’s pull out just a few for some insight on where cyber business crimes may be heading in 2019.

Among the most dramatic facts in this year’s report is the near doubling of cyber-crime losses. In 2018, victims of cyber-crimes lost more than $2.7 billion. That is up from $1.4 billion in 2017. Almost half of this loss, $1.3 Billion, was attributed to the Business Email/Email Account Compromise (BEC/EAC) attack.

There are two factors influencing this dramatic growth in losses. First, cyber-crime is simply getting bigger. There are more attacks, more sophisticated attacks, and the attacks are seeking bigger paydays. Second, more victims are actually reporting these crimes. The FBI established IC3 years ago, but for too long businesses were slow or reluctant to report falling victim to cyber schemes.

Early reporting of cyber-crime is leading to more assets recovered and losses avoided. In February 2018, the IC3 established the Recovery Asset Team (RAT) to recover fraudulent funds wired by victims. While recoveries are still small relative to total losses: $257 million; the actual recovery rate of losses referred to RAT is reported to be near 75%.

These two trends reflect the effect of upside of increased preparation and awareness. Businesses will continue to be among the most targeted victim classes because of the favorable cost-to-benefit ratio for these frauds. Preparation and employee training will continue to be the best defense against these attacks. But when a business becomes a cyber-crime victim nonetheless, a swift response is creating real opportunities to recover potential losses before it is too late.

If you have any questions of concerns about any types of fraudulent activity you may be encountering, please feel free to contact me.

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