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Phishing Leads Data Breach Costs

Key Points

  • The 2024 IBM Cost of a Data Breach Report identifies phishing as the second‑most common cause of breaches (15% of cases) and the second‑largest cost driver, averaging $4.88 million per incident.
  • Phishing is a form of social engineering that exploits human trust by appealing to motivations of “gain” (carrots) or “loss” (sticks), aiming primarily to steal credentials or deliver malware that harvests those credentials.
  • Attackers deliver phishing attempts through multiple channels: classic malicious emails, SMS messages (“smishing”), voice calls (“vishing”), and even QR codes, all designed to trick users into clicking links or revealing login information.
  • Successful phishing often results in credential theft used for identity theft, account takeover, or the deployment of info‑stealer malware that continues to harvest passwords.
  • Defensive strategies focus on user awareness of these tactics, verification of unexpected communications, and technical controls to detect and block suspicious links, messages, and QR‑code exploits.

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Full Transcript

# Phishing Leads Data Breach Costs **Source:** [https://www.youtube.com/watch?v=nSGQkE67jcg](https://www.youtube.com/watch?v=nSGQkE67jcg) **Duration:** 00:17:18 ## Summary - The 2024 IBM Cost of a Data Breach Report identifies phishing as the second‑most common cause of breaches (15% of cases) and the second‑largest cost driver, averaging $4.88 million per incident. - Phishing is a form of social engineering that exploits human trust by appealing to motivations of “gain” (carrots) or “loss” (sticks), aiming primarily to steal credentials or deliver malware that harvests those credentials. - Attackers deliver phishing attempts through multiple channels: classic malicious emails, SMS messages (“smishing”), voice calls (“vishing”), and even QR codes, all designed to trick users into clicking links or revealing login information. - Successful phishing often results in credential theft used for identity theft, account takeover, or the deployment of info‑stealer malware that continues to harvest passwords. - Defensive strategies focus on user awareness of these tactics, verification of unexpected communications, and technical controls to detect and block suspicious links, messages, and QR‑code exploits. ## Sections - [00:00:00](https://www.youtube.com/watch?v=nSGQkE67jcg&t=0s) **Phishing: Top Data Breach Driver** - Phishing, a social‑engineering tactic that exploits human trust and emotions like greed or fear, is the second‑most common cause and cost driver of data breaches in the 2024 IBM report, primarily targeting credentials. - [00:03:08](https://www.youtube.com/watch?v=nSGQkE67jcg&t=188s) **Phishing Variants and Their Ruses** - The speaker outlines phone‑based vishing, QR‑code qishing, and common social‑engineering contexts such as fake bank or courier messages that exploit fear and urgency. - [00:06:20](https://www.youtube.com/watch?v=nSGQkE67jcg&t=380s) **Spray‑and‑Pray vs Spear Phishing** - The speaker contrasts indiscriminate, mass‑mailed “spray and pray” phishing attacks with focused, research‑driven spear‑phishing campaigns that impersonate known banks or employers. - [00:09:31](https://www.youtube.com/watch?v=nSGQkE67jcg&t=571s) **AI‑Powered Hyper‑Targeted Phishing** - The speaker explains how attackers can use generative AI to scrape social‑media information, automate the creation of highly personalized phishing messages with perfect grammar, and launch faster, more convincing spear‑phishing campaigns. - [00:12:37](https://www.youtube.com/watch?v=nSGQkE67jcg&t=757s) **Secure Login Practices Overview** - The speaker advises typing URLs manually, enabling multi‑factor authentication, and adopting FIDO Passkeys instead of passwords to greatly reduce phishing and credential‑theft risks. - [00:15:40](https://www.youtube.com/watch?v=nSGQkE67jcg&t=940s) **Email Anti‑Spoofing and Least Privilege** - It advises organizations to deploy anti‑spoofing measures for inbound and outbound mail, continuously monitor traffic, and enforce the principle of least privilege by removing local admin rights from end‑user workstations. ## Full Transcript
0:00Guess what was the number two cause of data breach, according to the 2024 IBM 0:04Cost of a Data Breach Report, coming in at 15 % of cases? 0:10Also guessed, what was the number two in terms of cost of data breaches, coming in at $4.88 million? 0:19Big number. 0:21It turns out the answer to both of those questions is the same thing. 0:25Phising. 0:26No, that kind of fishing. 0:28Yeah, that kind of phishing. 0:30And a phishing attack is essentially what we refer to as a social engineering attack. 0:36In social engineering, the attacker is basically trying to manipulate 0:41the victim into doing things that they ordinarily would not and should not do, 0:46and how do they do that? 0:47Well, they're basically leveraging and exploiting our tendency as humans to trust each other. 0:54If we see the right cues, then we tend to trust something. 0:58And we use that evidence as the basis for that trust. 1:02The problem is sometimes what we trust is not right, 1:06and these fishing attacks generally gear around one or two different types of motivations. 1:12One is carrots and the other is sticks. 1:15In other words, you could think of it gain and loss or greed and fear, 1:20but generally that's the theme of these fishing attacks. 1:24So the bad guy is trying to exploit those feelings that we have, that we all have. 1:30And what are they trying to get? 1:31What's their goal? 1:32Well, what they ultimately want from you, in most cases, are credentials. 1:37They want the stuff that you use to log in with. 1:40They want to steal your password so that they can then go do identity theft, 1:43empty your bank account, do whatever, in your name. 1:47In some cases, though, they're actually trying to plant malware on your system, 1:52but guess what? 1:53A lot of that malware is in the form of an info stealer, which is designed to steal credentials. 2:00So again, we're seeing this is a big part of what all of this phishing is ultimately about. 2:06In this video, we're going to take a look at the different types of phishing attacks, 2:10as well as the defenses, the things you can do to keep yourself safe. 2:15Okay, let's take a look at some of the different classes of fishing attacks, 2:19and we'll break them down in terms of delivery, context, and type. 2:23So first of all, we'll take a look at the most common delivery format. 2:27Everybody is bound to have gotten one of these, an email. 2:30You get an email and it's giving you certain instructions, things you need to do. 2:34Invariably, there's a link in the email they want you to click, 2:37and when you do, then that's when you're either going to get the malware or the stolen credentials will follow. 2:44Another form, though, we can pull the same scheme if you're an attacker, but it doesn't have to be through email. 2:51It could be through a different form of delivery. 2:53It could be through an SMS message. 2:56And this we call smishing. 2:58It could also be through a voice message or a call where we get someone telling us what 3:04to do or leaving a message and telling us to call back or do something like that. 3:08We call this vishing. 3:10And then not to be left out, QR codes, you know, those things, those square things that you'll see popping up all over the place 3:17and they've got the little dots in them and you scan them with your phone and it takes you to a website. 3:21Well, what website is it taking you to a legitimate one or the one of an attacker? 3:26What do we call that? 3:27Wait for it. 3:28Qishing. 3:29Yes, of course, there's quishing. 3:31So and there are lots of other types. 3:33These are just some of the more common ones that we're aware of these days. 3:37Now, let's take a look at context. 3:38So what could be the context? 3:40In other words, the ruse, the story that's in this, whatever, however, it got to us. 3:45A really common one is claiming to be your bank. 3:49And we need you to log in and verify your details. 3:52Well, first of all, if my bank can't keep up with my details or where my address is 3:56and stuff like that, I don't want them holding on to my money. 3:59So that's not what banks, real banks really do. 4:02That's phishers trying to, guess what, play on your fears. 4:06This is one of those sticks examples where they're using sticks as a way to get you to do something. 4:12Another one is a courier, you know, somebody who is a delivery service 4:17and they say we've got a package for you that was undeliverable. 4:21Click on here so that we can confirm your address. 4:24Well, so this is also playing a little bit on fears, you know, a feeling of missing out. 4:28But more than anything, this is a chance. 4:30This is a carrot. 4:31This is like, Whoa, I wasn't expecting a package. 4:34I can get a great package. 4:35Great. Okay, 4:36but then when you confirm your details, you're going to be ending up giving them 4:40what they were after your credentials, probably in most cases. 4:43Some of them come in and say, we're the following e -commerce site, some well-known sites, 4:49and they'll say the order for the laptop just got processed against your credit card, 4:55snd we're going to charge you $2,500 for that. 4:58Click here to approve or click here if you didn't approve of that purchase, 5:04and it turns out you didn't because they made the whole thing up. 5:07And when you click in, again, you're going to get back to the same sort of issues that pop up again. 5:13What could be some others? 5:14How about this? 5:16Everybody loves a contest. 5:19Everybody loves to be a winner sweepstakes. 5:21You win a gift card. 5:23Okay. This is clearly a carrot. 5:24This is a greed situation. 5:26That one, by the way, is a fear situation. 5:28I'm afraid my credit card is actually being charged. 5:31Here we're looking at, okay, I just need to click in here, give them my details, 5:35because after all, they have to know where to send all these grand prizes that I've just won. 5:39By the way, you didn't win. 5:41That's probably another form of phishing attack. 5:44And then another one that's really growing in popularity these days is a lot of people are looking for jobs online 5:50is a phishing attack that involves a job offer or some sort of, too good to be true. 5:56Work two hours a day and do it from poolside, eating bonbons, and you're going to get days off. 6:02You're going to get great pay. 6:04This is just wonderful. 6:06Of course, it's not. 6:07This is another greed type of motivation or gain or carrot that's being thrown out there. 6:14Again, you click into this and we're going to end up right back in the same place we did with others and many more. 6:21Now, in terms of type, how do these the different phishing types, what would they look like? 6:28Well, the most common, the one that we're all more familiar with is what I'll refer to as the spray and pray. 6:36The attacker just sends these out indiscriminately and they send it to everyone saying, I'm your bank. 6:43I've gotten these from banks claiming to be banks that I have never done business with. 6:48So I if they're wrong, they'd only need to be right a very few times. 6:56So it doesn't matter to them if they're wrong most of the time. 6:59It's very indiscriminate. 7:00Just spray and pray, send it out there to everybody and hope that some suckers fall for this. 7:05Okay. 7:06Another type, which is very different than that is called a spear phishing attack. 7:11In spear phishing, it's much more targeted. 7:14Maybe I know what your bank is or maybe I know where you work. 7:19And so in that case, I'm going to send an email that looks like it's coming from your bank where you actually do business, 7:25or from your place of work where I know you work. 7:28And in that case, I've had to do a little more research, but maybe not. 7:33In some cases, if it's employees, they're all going to, in their email addresses, 7:36probably going to have the same domain after the at sign. 7:39So we could, if I was a fisher, I could put together an email that says it's coming from there 7:44and send it to only people that have that as their email address. 7:49And that way it's going to seem more targeted. 7:51People are more likely to believe it because it doesn't seem just as indiscriminate. 7:56Another version of this is what's referred to as whaling, 7:59and in a whaling phishing attack, what we're basically doing, the attacker 8:03is going after the quote unquote big fish in the organization, the high level executives. 8:09In this case, it's like a hyper spear fished hyper focused type of attack. 8:14And they've done even more focus in terms of the way they put together their attack, 8:21but here in this case, it's just the opposite of the spray and pray where we just send a whole bunch out and hope we get a few. 8:27Here, we're really going after a few people that are well known and who would be high value targets. 8:34And then one of the other things that's done in these is a cloning attack. 8:39Take a legitimate email that maybe came from a bank and then 8:42use all the icons and everything else, all the language, everything's exactly the same. 8:47All they do is just substitute in their link, the link of the attacker instead of the link that is from the actual bank. 8:55So it's very passable and very believable. 8:58So cloning attacks are another version of this. 9:01And again, this is just a partial list. 9:04There are a lot of different ways that people do this stuff. 9:06So that's phishing as we've traditionally seen it up to this point, 9:10and I'm going to tell you, it's not going to get better. 9:13It's going to get worse. 9:15Stop and think about this. 9:17AI is everywhere. 9:19What's going to be the impact of AI on phishing attacks? 9:22Well, it turns out if you had an AI, it could do a lot more research on the individual that you're trying to phish. 9:32So your spear phishing, your whale phishing becomes even more focused. 9:37How would they be able to do that? 9:39Well, one way that they'd be able to get information would be through social media. 9:43So I'm going to be able to do some research and use publicly available 9:48sources, look on your social media accounts and see things about you, 9:53and as a result, I can come up with a hyper -personalized attack. 9:59It's going to be something that resonates with you and I'll know it will resonate with you, 10:04and the AI did the research, did all the leg work. 10:07So obviously one of the things you want to do is make sure your social media is not accessible to the entire world, 10:13but using an AI to go read all of that stuff and come up with what are the 10:18things that would cause a person to be triggered, that's going to automate that research process, 10:24and another big impact, we've told people for years, the way to avoid phishing attacks is to look for certain clues. 10:33And one of those is bad grammar and things like that. 10:37Well, guess what? 10:38One thing that AI can do really well, especially generative AI, it doesn't make those kinds of mistakes. 10:44So if I'm a fisher and English is not my first language, 10:47I can still use a generative AI chat bot to generate 10:52my phishing email, have it do this research, and then have it generate, do the with no grammar errors. 11:00It will be perfect grammar. 11:01There'll be no spelling errors either. 11:04I wish I could do that, but I can't. 11:06And it's going to be able to do all of this at speed and at scale. 11:11So we should, all the people that we've trained to look for grammar and spelling 11:16errors as their primary cue for a phishing attack, we need to go back and unlearn 11:21that from them because AI is going to make all of that stuff go away. 11:26Okay, now we've covered the different types of phishing attacks 11:30and how things will get, but now what are you supposed to do about all of it? 11:33Don't just wring your hands. 11:35There are some actions you can take. 11:36Let's take a look at those defenses. 11:38It turns out the United States National Institute of Standards and Technology 11:43NIST came out with a really good document on exactly this. 11:47I'm going to point out what some of the things that they came out with, along with some of my own ideas mixed in here, 11:52but I would say number one, the number one job in terms of defenses is really about training. 11:58Make sure that you, and if you're responsible for training 12:02the folks in your organization, make sure they know about this and about this. 12:07Show them this video, for instance, because the best defense I think 12:12is someone's skepticism and awareness that these kinds of things are possible. 12:16Then they're less likely to fall for all of this kind of stuff. 12:19Teach them, as we've been saying for a long time, but continue to emphasize don't click on links that are in emails. 12:27It's much better if you see, even if you think it is your bank and there's a link, 12:32then go to the bank's website directly from a bookmark that you've saved, for instance. 12:38Go type it in on the URL line in the browser. 12:42That's a lot better than clicking on a link because a link can look like one thing 12:45and when you click on it, it actually redirects you to some other place. 12:49Another good technology to use here is multi -factor authentication. 12:53If somebody's trying to steal your credentials, that is your password, 12:57and that's all you have to do in order to log in is type in a password, then they've got your account. 13:03If we have multi-factor authentication, then a password alone will not get someone into your account. 13:08They also might have to have something that you possess, like maybe your phone that's been pre-registered or your face. 13:14It turns out if somebody takes your face, you're probably going to realize that. 13:18That makes it a lot more difficult for an attacker if they have to compromise multiple factors of authentication. 13:26Another thing I'm a big believer in is this technology called PassKeys that comes 13:31from an organization called FIDO, the Fast Identity Online organization. 13:37It's an international standard and it's better than passwords. 13:40I did a video on this, so you can go take a look, two videos if you want to see more about that. 13:44I won't go into that in detail here, but what it does is it replaces a lot of the weaknesses of passwords. 13:50People don't have to remember stuff to go along with it, and it makes it so that it's much more resistant to phishing attacks. 13:57Nothing's ever 100%, but this is pretty darn solid. 14:00If you get an opportunity, and you may see this more and more with websites 14:04you go to log into, and it says, would you like to create a PassKey? 14:07I'd say do it. 14:08The PassKey will be stronger than a user-chosen password, because people really stink at picking passwords. 14:16Another thing you could do, and a lot of people ignore this one, is use a secure DNS. 14:22DNS is the thing, and this is an example of one Quad9. 14:25DNS is the thing when you type in, for instance, a URL, like you want to go to a particular place like IBM.com, 14:33then the internet doesn't know where that is, but it will 14:36turn that into a numeric address that begins with 9 dot something dot something dot something. 14:43That conversion is what the DNS does. 14:46IBM has a free service that we've partnered with another company in order to make 14:51the service available, and it's called Quad9, because if you replace the DNS in your software 14:58with four nines by the IBM owns that nine dot subnet address range, then you're going to get something 15:04that if you click on a link that's to a known bad place, it just won't resolve. 15:10So it won't do this part. 15:12If you had something else that was wrong, like 1bm .com, if 15:16that's even a website, and it turned out to be a fake version that was a knockoff. 15:21So it won't resolve that, and therefore you won't go to those places. 15:24This is a very low -cost way that you can prevent those things from happening. 15:29Another one is an industry standard called DMARC, 15:32and this one stands for Domain -Based Message Authentication Reporting and Conformance. 15:38It's a big mouthful, so we'll just call it DMARC. 15:40Basically what it does is it's an anti-spoofing technology, and you want to do this 15:45for the emails coming into your environment, implement that into your infrastructure. 15:51If you're an end user, you won't need to do this. 15:53This is something your IT staff should be setting up for you. 15:56Also, implement it on the emails that are leaving your organization so that you are not the source of spoofed emails, 16:04where someone's claiming to be a bank, and in fact it's coming from someplace else. 16:08If everybody did this, this would make things a lot more secure. 16:12Do a lot of monitoring. 16:14Look and see what's coming into your environment and what's going out. 16:18Be the eyes and ears so that you're on top of this stuff to begin with, 16:23and then good idea is a lot of users have admin rights on their individual workstations. 16:30Probably not the best thing for most users because they don't really know what to do with all that much power, 16:35so it's best to turn admin rights off on individual 16:40end user workstations and have only administrators with those capabilities, 16:44and by the way, that's in keeping with the security principle of least privilege. 16:48That is, you only have the access rights that you need. 16:51That way, they're less likely to get the malware installed on their system in the first place 16:56because they would need admin rights for new software to be installed. 17:00Okay, so I admit that's a lot to take in. 17:03All of the different motivations, all of the different types, and how it's moving in the future, 17:08but just bear in mind, the good news is we do have some defenses. 17:12There are some things you can do to keep yourself safe, 17:15and if you do these things, you'll tip the balance back in your favor.