Understanding and Preventing CEO Fraud: Strategies for Businesses

“Blind belief in authority is the greatest enemy of truth.” — Albert Einstein

When the boss says, “Jump!” many employees simply ask, “How high?” This tendency to follow authority without question is why CEO fraud—a type of Business Email Compromise (BEC)—is alarmingly effective. This deceptive email scam convinces employees to wire transfers or reveal critical company information, costing businesses billions worldwide.

The FBI’s Internet Crime Complaint Center (IC3) reports that scammers lost nearly $13 billion to CEO fraud from 2013 to 2018. This cybercrime targets companies of all sizes around the world. It uses psychological tricks and fake emails to succeed. Here’s how CEO fraud works, a real-world example, and actionable strategies to safeguard your organization.

What is CEO Fraud?

CEO fraud is a sophisticated email hoax that tricks employees, particularly in finance and administration, into taking damaging actions. Cybercriminals often impersonate top executives, using spoofed or compromised email accounts to send messages that appear legitimate. This highly targeted spear phishing emails typically include urgent requests, pushing employees to bypass standard verification processes.

CEO fraud attacks commonly rely on three primary methods:

• Phishing: Mass-targeted emails intended to deceive many recipients.
• Spear Phishing: Tailored attacks targeting specific employees with crafted, relevant information.
• Whaling: A more specific form of phishing, targeting high-profile executives.

Each of these approaches exploits trust and human error, demonstrating how even cautious employees can be vulnerable.

The Psychology Behind CEO Fraud

CEO fraud is essentially a form of social engineering. Hackers write their emails to gain the trust of the person reading them. They often copy the tone, language, and urgency that a real CEO or executive would use.

They know that most people do not pay close attention to small details. This includes email domains and small spelling mistakes in names. They take advantage of these oversights to get what they want.

Social media helps attackers in these attacks. They collect information about executives and employees to make their emails more believable.

With this psychological manipulation, the fraudsters capitalize on:

• Authority Bias: Employees instinctively trust directives from higher-ups, even if those directives seem unusual.
• Urgency: Messages are often urgent, making employees feel compelled to act quickly without their usual diligence.
• Persistence: Hackers may attempt contact several times, hoping to wear down cautious employees.

In these scams, cybercriminals only need one weak link—a single vulnerable employee or misconfigured machine—to succeed. Awareness and vigilance are key to preventing such attacks.

2025 CEO Fraud Statistics

In 2025, CEO fraud remains a top cybersecurity threat, with business email compromise (BEC) attacks causing $2.7 billion in losses globally, according to the FBI. Here are some key CEO Fraud statistics for 2025:

• CEO fraud has been reported in all 50 U.S. states and 186 countries. Over 305,000 incidents were recorded globally between 2013 and 2023. (Source)
• In 2023, the FBI IC3 received 21,489 BEC/CEO fraud complaints, slightly down from 21,832 in 2022. (Source)
• The UK recorded 432 CEO fraud cases in 2022, leading to £13.4 million in losses. (Source)
• Global exposed losses from CEO fraud have surpassed $55.5 billion over the past decade. (Source)
• In 2023, CEO fraud accounted for $2.9 billion in reported losses in the U.S., making it the second-costliest cybercrime. (Source)
• The average wire transfer request in a BEC scam was nearly $293,000 in Q2 2023. (Source)
• CEO fraud losses have more than doubled between 2018 and 2023, showing continued growth. (Source)
• 22% of high-value BEC attacks now incorporate voice deepfake technology, making scams more convincing. (Source)
• The real estate industry saw a 72% increase in CEO fraud losses from 2020 to 2022, making it a major target. (Source)
• Manufacturing, real estate, financial services, healthcare, and professional services are among the most targeted industries for CEO fraud. (Source)

Real CEO Fraud Attack Cases

Cybercriminals have successfully exploited CEO fraud to steal millions from companies worldwide. These attacks often involve fake emails from executives, pressuring employees into making urgent financial transactions. Here are some real-life cases of CEO fraud that highlight the devastating impact of this attack:

Chris Kirchner and Slync.io

In January 2024, Christopher Steven Kirchner, co-founder and former CEO of the logistics company Slync.io, was convicted on charges of wire fraud and money laundering. Kirchner had misappropriated at least $25 million from investors, diverting company funds for personal luxuries, including a $16 million private jet and a $495,000 luxury suite at a Dallas sports stadium. His fraudulent activities led to a 20-year prison sentence and an order to pay over $65 million in restitution. ​

Carlos Watson and Ozy Media

In July 2024, Carlos Watson, founder and CEO of Ozy Media, was convicted on charges of conspiracy to commit securities fraud, wire fraud, and aggravated identity theft. The conviction stemmed from deceptive practices aimed at securing investments for the media company, including impersonating executives from other companies to mislead potential investors. Watson faced up to 37 years in prison following his conviction.

Dozy Mmobuosi and Tingo Group

In December 2023, Dozy Mmobuosi, founder and former CEO of Tingo Group, was charged by the U.S. Securities and Exchange Commission (SEC) with orchestrating a massive fraud. The SEC alleged that Mmobuosi fabricated financial statements and misled investors about the company's operations and profitability. In September 2024, a U.S. district court ordered Mmobuosi and his entities to pay a $250 million fine following these allegations.

Why CEO Fraud Succeeds

CEO fraud succeeds because it exploits basic email security weaknesses and human trust. A key tactic in these attacks is executive whaling.

In this method, cybercriminals pretend to be high-ranking executives. They trick employees into transferring money or sharing sensitive information. Here are some factors that make CEO fraud so effective:

• Similar-Looking Domains: Many fraudsters create email domains that closely mimic legitimate company emails. About 50% of email servers are not configured correctly, allowing fraudulent emails to slip through.
• Massive Target Pools: With millions of email servers worldwide, cybercriminals have nearly unlimited options for potential victims. Exchange servers and other email platforms present vast attack surfaces.

These vulnerabilities make CEO fraud difficult to prevent entirely, but there are actions your business can take to reduce its risk.

Steps to Prevent CEO Fraud

Given the scope of CEO fraud phishing, every organization should take proactive measures to mitigate risk. Below are key strategies to keep your business and employees safe:

1. Hover Over Email Addresses

Before responding, hover over the email address to see if it matches the expected sender. Small differences, like a single letter variation, can reveal a CEO fraud email.

2. Implement Clear Policies

Create specific policies for handling sensitive information and making financial transactions. Reinforce these policies regularly so employees understand their responsibilities in verifying requests.

3. Restrict Network Access

Think about limiting network access. This can help control information sharing on personal devices. It also helps manage data flow outside your organization. Enforce secure network practices for software and network tools to keep systems up to date.

4. Checks and Balances for Financial Transactions

Require two-factor authentication (2FA) for large transactions and mandate verbal verification (e.g., a phone call) before releasing funds. This simple extra step can prevent unauthorized transfers.

5. Strengthen Spam Filters

Configure anti-spam measures and keep them updated. This step can lower the number of fake CEO fraud emails that employees see. This helps reduce their risk of scams.

6. Create Security Awareness Training Tailored to CEO

Training programs should teach CEOs about the latest attack methods. They should stress the need to verify important transactions. CEOs must learn to recognize social engineering tactics. It is also vital to secure their online presence.

By incorporating real-world attack simulations, role-specific scenarios, and ongoing threat intelligence updates, organizations can ensure CEOs are equipped with the knowledge and tools needed to identify and respond to sophisticated threats effectively.

Providing clear and focused training with practical tips helps bridge the gap between cybersecurity and business goals. This strengthens the CEO's role in promoting a security-focused culture in the company.

For more insights on tailoring security awareness training for executives, check out Security Awareness Training for Executives: Protect Leaders from Cyber Threats and explore our Adaptive Phishing Simulation for Executives.

Stay Vigilant and Educated

There’s no better defense than ongoing education on CEO fraud and its potentially disastrous consequences. When something feels a bit “off,” encourage employees to trust their instincts. This could mean rechecking an email address or calling to confirm a request. Eliminate blind trust and empower your team to speak up when something doesn’t seem right.

Editor’s note: We updated this blog on March 10th, 2025.