Phishing Attacks 2007, Over $3 Billion Lost

Published Wed, 2008-02-27 19:11

Phishing attacks in the United States soared in 2007 as $3.2 billion was lost to these attacks, according to a survey by Gartner, Inc. The survey found that 3.6 million adults lost money in phishing attacks in the 12 months ending in August 2007, as compared with the 2.3 million who did so the year before.

According to a survey of more than 4,500 online U.S. adults in August 2007 (which was representative of the online U.S. adult population) the attacks were more successful in 2007 than they were in the previous two years. Of consumers who received phishing e-mails in 2007, 3.3 percent say they lost money because of the attack, compared with 2.3 percent who lost money in 2006, and 2.9 percent who did so in 2005, according to similar Gartner surveys during those years.

The average dollar loss per incident declined to $886 from $1,244 lost on average in 2006 (with a median loss of $200 in 2007), but because there were more victims, $3.2 billion was lost to phishing in 2007, according to surveyed consumers. There was a bit of relative good news, however; the amounts that consumers were able to recover also increased. Some 1.6 million adults recovered about 64 percent of their losses in 2007, up from the 54 percent that 1.5 million adults recovered in 2006.

PayPal and eBay continue to be the most-spoofed brands, but phishing attacks increasingly employ devious social engineering attacks, impersonating, for example, electronic greeting cards, charities and foreign businesses.

Thieves are increasingly stealing debit card and other bank account credentials to rob accounts targeting areas where fraud detection is weaker than it is with credit card accounts. According to the survey, of those consumers who lost money to phishing attacks, 47 percent said a debit or check card had been the payment method used when they lost money or had unauthorized charges made on their accounts. This was followed by 32 percent of respondents who listed a credit card as the payment method, and 24 percent who listed a bank account as the method (multiple responses were allowed).

Phishing and malware attacks will continue to increase through 2009 because it's still a lucrative business for the perpetrators, and advertising networks will be used to deliver up to 30 percent of malware that lands on consumer desktops.

Gartner sees no easy way out of this dilemma unless e-mail providers have incentives to invest in solutions to keep phishing e-mails from reaching consumers in the first place, and unless advertising networks and other "infection point" providers (which theoretically can be any legitimate Web site or service) have incentives to keep malware from being planted on their Web sites to reach unsuspecting consumers.