It wasn’t so long ago that cyber breaches were the latest emerging risk for wealth managers and other professional service firms. As business continues to rely more heavily on technology, more businesses are concerned about potential liability arising from their collection and storage of information. In response, many are turning to technology to protect themselves, taking steps to address their risk through enhanced incident response plans, information security policies, mandated and automated software updates, firewalls and encryption. But while cyber liability losses and privacy claims continue to rise, a new human risk factor has arisen: social engineering fraud (SEF).
As computer security has grown more sophisticated, hackers have found that it might be easier to manipulate an individual rather than a machine. SEF, a term used to refer to online scams criminals use to trick victims into releasing confidential information or funds, has cost U.S. businesses more than $1.6 billion since 2013, according to the FBI. In a typical SEF scam, a victim receives a phone call or email request purportedly from a legitimate client, vendor or fellow employee fraudulently asking for a…
