2023 State of the Phish Report shows a large increase in direct financial losses due to phishing
- Published: Thursday, 02 March 2023 09:20
Proofpoint, Inc., has released its ninth annual State of the Phish report, revealing attackers are using both emerging and tried-and-tested tactics to compromise organizations.
Eight in 10 organizations (84 percent) experienced at least one successful email-based phishing attack in 2022, with direct financial losses as a result increasing by 76 percent compared to 2021. And while brand impersonation, business email compromise (BEC), and ransomware remained popular tactics among threat actors, cyber criminals also scaled up their use of less familiar attack methods to infiltrate global organizations.
This year’s State of the Phish report provides an in-depth overview of the real-world threats, as sourced by Proofpoint’s telemetry encompassing more than 18 million end-user reported emails and 135 million simulated phishing attacks sent over a one-year period. The report also examines perceptions of 7,500 employees and 1,050 security professionals across 15 countries, revealing ‘startling gaps’ in security awareness and cyber hygiene that propagate the real-world attack landscape.
Key findings include:
Cyber extortion continues to wreak havoc
76 percent of organizations experienced an attempted ransomware attack in the past year, with 64 percent suffering a successful infection; yet only half regained access to their data after making the initial ransomware payment. Alarmingly, over two-thirds of respondents said their organization experienced multiple, separate ransomware infections.
Most infected organizations paid up, and many did so more than once. Of the organizations impacted by ransomware, the overwhelming majority (90 percent) had a cyber insurance policy in place for ransomware attacks, and most insurers were willing to pay the ransom either partially or in full (82 percent). This also explains the high propensity to pay, with 64 percent of infected organizations paying at least one ransom—a six-point increase year-over-year.
End users fall prey to bogus branded emails
In 2022, Proofpoint observed nearly 1,600 campaigns involving brand abuse across its global customer base. While Microsoft was the most abused brand name with over 30 million messages using its branding or featuring a product such as Office or OneDrive, other companies regularly impersonated by cybercriminals included Google, Amazon, DHL, Adobe, and DocuSign. It’s worth noting that AitM attacks will display the organization’s real login page to the user, which in many cases will be Microsoft 365.
Considering the volume of brand impersonation attacks, it’s alarming that nearly half (44 percent) of employees indicate they think an email is safe when it contains familiar branding, and 63 percent think an email address always corresponds to the matching website of the brand. It’s no surprise to see that half of the 10 phishing simulation templates most used by Proofpoint customers were brand-impersonation related, which also tended to have high failure rates.
Business email compromise: cyber fraud goes global
On average, three-quarters of global organizations reported an attempted BEC attack last year. While English is the most common language employed, some non-English-speaking countries are starting to see higher volumes of attacks in their own languages. BEC attacks were higher than the global average or experienced a notable increase compared to 2021:
- The Netherlands 92 percent (not featured in prior analysis)
- Sweden 92 percent (not featured in prior analysis)
- Spain 90 percent vs. 77 percent (13 percentage point increase)
- Germany 86 percent vs. 75 percent (11 percentage point increase)
- France 80 percent vs. 75 percent (5 percentage point increase)
Pandemic-related job mobility, coupled with post-pandemic economic uncertainty, has resulted in large numbers of workers changing or leaving jobs to the tune of one in four employees in the past two years. This job market trend makes data protection more difficult for organizations, with 65 percent reporting they have experienced data loss due to an insider’s action. Among those who have changed jobs, nearly half (44 percent) admitted to taking data with them.
Threat actors scale up more complex email threats
Over the past year, hundreds of thousands of telephone-oriented attack delivery (TOAD) and multi-factor authentication (MFA) bypass phishing messages were sent each day—ubiquitous enough to threaten nearly all organizations. At its peak, Proofpoint tracked more than 600,000 TOAD attacks—emails that incite recipients to initiate a direct conversation with attackers over telephone via bogus ‘call centers’— per day, and the number has been steadily rising since the technique first appeared in late 2021.
Cyber attackers now also have a range of methods to bypass MFA, with many phishing-as-a-service providers already including AitM tooling in their off-the-shelf phish kits.
Room for improvement with cyber hygiene
Threat actors always innovate, and once again this year’s report shows that most employees suffer security awareness gaps. Even basic cyber threats are still not well understood — more than a third of survey respondents cannot define ‘malware’, ‘phishing’, and ‘ransomware’.
In addition, only 56 percent of organizations with a security awareness program train their entire workforce, and only 35 percent conduct phishing simulations—both critical components to building an effective security awareness program.