CEO Fraud: Trust NoOne

Security Awareness/Uncategorized
16 April 2024

One of Fremantle‘s leading execs in Europe has become victim of a sophisticated $1M scam: ‘CEO Fraud’

Imagine making a transfer of almost one million euros in a hurry, only to realize a few minutes later that you have been tricked. In just a moment, you have lost a huge amount of money, credibility, and prestige. A simple human error…

Now, picture this happening not to a novice technology enthusiast, but to a top-level executive at a multinational television production company.

A top executive at Fremantle in Europe fell victim to a $1 million ‘CEO Fraud’ scam, as reported by the Corriere Della Sera newspaper. The scam is becoming increasingly common and targets business leaders and C-suite individuals who can access large funds. 

The fraudsters pose as senior leaders within an organization and use methods like cloned VoIP (voice over IP) numbers to gain trust before requesting an immediate transfer of money. In this particular case, the scammers convinced the executive, Ondarza, to send €937,670 ($1M) to an Asian account, which was subsequently distributed to numerous other international accounts (IBANs), making it extremely difficult to track the money.

The fraudsters sent an email to Ondarza instructing him to transfer the money to a particular account. Ondarza soon realized that it could have been a scam and contacted other Fremantle executives before calling the Italian police. Police in Rome are now investigating the fraud.

Fremantle, a production and distribution company, acknowledged the incident and is working with the authorities to resolve the matter. Ondarza joined Fremantle last year after serving as CEO for Southern Europe and Israel at Paramount Global.
Today, Fremantle announced its acquisition of Asacha Media Group, a move that follows their purchase of 80% of Beach House Pictures in Singapore earlier this year. The company has invested over €200M ($216M) in these acquisitions.

Have you heard of CEO fraud?

It’s a type of scam where a hacker pretends to be the CEO or another important person in a company. They then trick other employees, especially those in finance, into sending them money. This kind of attack is all about getting financial gain, and the hackers often make it sound very urgent.

Sometimes people use the terms CEO fraud and Business Email Compromise (BEC) interchangeably. 
But BEC covers a lot of different types of malicious email, not just ones where the hacker pretends to be a CEO.
Hackers might try to trick anyone in a company, from the CEO to a low-level employee, or even people outside the company, like clients or partners.

One of the reasons these scams work so well is because hackers are good at manipulating people’s emotions to gain access to their social properties. They might make it sound like something terrible will happen if the money isn’t sent right away. And unfortunately, people often send the money, or their sensitive data, in real time without checking if the request is real.

How to reduce the risk of CEO fraud

  • To avoid CEO fraud, it’s important to verify any payment requests that involve new suppliers or modified bank details, including internal emails from senior management, through an independent channel.
  • It’s crucial to train all payment staff to be vigilant, knowledgeable, and confident enough to question such requests.
  • Keep an eye on how much information is being shared about your company and key personnel through your website, social media, and out-of-office automated replies.
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