Business Email Compromise (BEC) attacks are some of the stealthiest and costliest threats facing companies today. In 2023, over $2.9 billion in losses were reported in the U.S. alone due to BEC scams. These attacks work by tricking trusted employees, often in finance or accounts payable, into approving transfers, invoices, or payroll changes under false pretenses. 

In this guide, we’ll walk you through what BEC attacks are, why they succeed so often, and proven methods to protect your business before it’s too late:

What is Business Email Compromise (BEC)?

BEC is a targeted cybercrime where attackers use email to deceive employees into transferring money or sensitive information. Unlike spam or traditional phishing, BEC attacks are highly personalized. Attackers often impersonate executives, vendors, or partners to make fraudulent requests look legitimate.

Common targets of BEC attacks include businesses and individuals performing wire transfers, invoice processing, or payroll activities. Because the messages usually come from real accounts or convincing lookalikes, they bypass filters and exploit human trust rather than relying on malware.

How Does a BEC Attack Work?

BEC attacks usually follow a pattern where criminals study their targets, craft convincing messages, and exploit trust to defraud businesses. Here’s a step-by-step breakdown of how they work:

Reconnaissance 

Attackers research the company, executives, vendors, and finance workflows. They harvest names, titles, payment patterns, supplier contacts, and email formats from public sources, social media, or breached data. The better the reconnaissance, the more convincing the fraud.

Initial Access 

Access is gained in two main ways: (a) credentials are stolen via phishing, credential stuffing, or breached data; or (b) attackers spoof or create lookalike domains and display names to impersonate trusted senders. Both methods let attackers send apparently legitimate requests from believable addresses.

Account Takeover 

If attackers control a legitimate mailbox, they can read past correspondence to mimic tone and timing, add malicious rules (auto-forwards), and block or delete alerts. They may also attempt to escalate access by harvesting credentials for other systems like financial apps and payroll portals.

Social Engineering

Using stolen context (invoices, contract terms, vendor names), attackers craft urgent, plausible messages for payment changes, fake invoices, or last-minute “CEO approvals.” These are tailored to bypass suspicion and exploit existing trust in internal workflows.

Invoice & Payment Manipulation

Attackers alter vendor invoices, submit fake invoices, or request updated payment details. For wire transfers, they time requests to coincide with approved schedules or attach fabricated supporting documentation to appear routine.

Monetization 

Once a payment is approved, funds are sent to attacker-controlled accounts, often routed through multiple intermediaries or converted into crypto to obstruct recovery. Attackers move quickly to cash out before the fraud is detected.

Cleanup & Covering Tracks

To delay discovery as much as possible, attackers might delete email threads, disable alerts, or remove inbox rules that would notify staff. This increases the window before the fraud is noticed and traced.

Why Are BEC Attacks So Effective?

BEC attacks succeed not because of advanced malware, but because they exploit trust, authority, and routine business processes. Attackers craft messages that blend into normal communication with several factors making them effective:

• They Exploit Human Trust: Emails appear to come from executives, vendors, or partners that employees already know. When a familiar name asks for a payment update or urgent approval, staff are far more likely to comply without double-checking.

• They Mimic Legitimate Business Workflows: Attackers use real invoices, contracts, and payment schedules to make fraudulent requests look routine. Because these details align with actual business activity, red flags are harder to spot.

• They Rely on Urgency and Authority: Messages often invoke time pressure (“this needs approval today”) or executive authority (“the CEO needs this handled immediately”). These psychological levers override normal verification processes.

• They Bypass Traditional Security Tools: With no malware payloads or obvious phishing links, BEC emails often slip through spam filters and endpoint protections. By the time the fraud is discovered, payments are usually already processed.

The Consequences of BEC Attacks

The fallout from a BEC attack goes well beyond a single fraudulent transfer. These incidents can undermine a company’s finances, reputation, and long-term stability:

Direct Financial Loss

The primary goal of BEC is money, and once funds are wired to attacker-controlled accounts, they are quickly laundered through multiple banks or converted into cryptocurrency. This makes recovery rare, even if fraud is detected quickly. Losses may also extend beyond the stolen amount, as companies face chargeback disputes, legal fees, and higher insurance premiums after an incident.

Reputational Damage

Trust is one of the hardest assets to restore. Customers, vendors, and partners expect financial integrity in every transaction. When fraudulent invoices or altered payment instructions come to light, victims often find themselves blamed for negligence. Word spreads quickly in industries where relationships drive business, and reputational fallout can affect future contracts and growth.

Operational Disruption

Responding to a BEC attack pulls resources away from day-to-day business. Finance teams must halt or double-check payments, IT must investigate compromised accounts, and leadership must manage fallout with stakeholders, creating delays in cash flow, impacting vendor relationships, and causing stress across departments—sometimes lasting weeks while systems and processes are reviewed.

Legal and Compliance Risks

Regulations like SOX, GDPR, and industry-specific financial controls require organizations to maintain secure processes around payments and data. A BEC incident may expose personal or financial data or highlight weak controls, opening the door to regulatory fines and lawsuits. For publicly traded companies, disclosure obligations can add additional reputational pressure on top of financial penalties.

How to Prevent BEC Attacks

BEC attacks exploit human trust as much as technical gaps. Preventing them requires a mix of stronger identity controls, stricter financial processes, and employee awareness.

1. Enable Multi-factor Authentication: MFA adds a second layer of protection beyond passwords, such as an app code or hardware key. Even if attackers steal login credentials, they can’t access accounts without the additional factor, making it much harder for BEC attempts to succeed.

2. Use a Password Manager: A password manager enforces strong, unique credentials across all accounts and stores them securely. With PureVPN’s Password Manager, finance teams can rotate logins, prevent reuse, and detect if credentials appear in breaches, reducing the risk of attackers hijacking email or financial systems.

3. Strengthen Payment Verification Processes: Most BEC frauds involve wire transfers or invoice changes. Requiring multi-person approvals or out-of-band verification (such as a phone call) before processing high-value payments ensures that even convincing fake emails don’t automatically result in lost funds.

4. Train Employees to Spot Red Flags: Finance staff should be able to recognize urgent or unusual requests, slightly altered email domains, and changes to payment instructions. Regular awareness exercises ensure employees stay alert and confident in escalating suspicious requests before acting on them.

5. Monitor and Audit Account Activity: Suspicious logins, new mailbox rules, or unexpected email forwarding can signal compromise. Setting alerts and running regular audits of vendor and payroll data give organizations visibility to catch BEC attempts early, before attackers move money out of reach.

Final Word

BEC attacks don’t rely on malware or brute force, but rather exploit trust, routine processes, and human error. With billions lost each year, no business can afford to ignore the threat. By enforcing MFA, using a secure password manager, strengthening payment verification, training employees, and monitoring account activity, you can close the gaps attackers look for and stay ahead of one of today’s most costly cybercrimes.