You've probably heard the Chinese Proverb: Give a man a fish, and you feed him for a day. Teach him how to fish, and you feed him for a lifetime.”  

In cybersecurity, it's more like this: "Protect your employees from a phishing scam, and they're safe for today. Teach your employees to detect phishing scams, and stay protected."

Phishing scams have become increasingly prevalent and sophisticated, making it essential for individuals and businesses to stay vigilant.

More than 90% of successful cyber-attacks start with a phishing email, according to Cybersecurity & Infrastructure Security Agency (CISA).

Not only is the risk high, but the chances of a phishing email ending up in your or your employee’s inbox are also growing. According to a report by Digital Guardian, 90% of security breaches in corporations stem from phishing attempts.

So, how can you protect yourself and your organization from falling prey to these scams? Let's dive into the details.

 

What is Phishing and Why is it So Common?

Phishing is a type of cyber attack where attackers pose as legitimate organizations to trick individuals into revealing sensitive information, such as login credentials, credit card numbers, or other personal data. These attacks are typically carried out through deceptive emails, text messages, or even phone calls.

In 2020, the COVID-19 pandemic drove thousands of companies to adopt remote work, with millions of employees shifting to home offices. This sudden increase in digital dependence exposed new vulnerabilities, giving cyber criminals more opportunities to exploit weak security systems.

Phishing attacks became a favored method, as employees were now more isolated and reliant on email and online communication. As a result, cyber criminals ramped up their efforts, creating 6.95 million new phishing and scam websites in 2020 alone, according to CSO Online. Phishing accounts for over 80% of reported security incidents, a trend that continues to grow as businesses struggle to keep up with rapidly evolving threats.

Phishing is easy, cost-effective, and exploits human behavior. Attackers use social engineering to create a sense of urgency or fear, tricking people into clicking malicious links or sharing sensitive information. Phishing emails often mimic legitimate sources, making them hard to detect.

Phishing also serves as a gateway to larger attacks like ransomware or data breaches, and evolving techniques help attackers stay ahead of traditional defenses. Its simplicity and high success rate make phishing a persistent and effective cyber threat.

 

Common Types of Phishing Attacks

Understanding the different forms of phishing can help you recognize and avoid them:

Email Phishing: The most traditional form, where attackers send fraudulent emails that seem to come from reputable companies, often containing malicious links or attachments.

Spear Phishing: More targeted, this method involves attackers researching their victims to create personalized and convincing emails.

Whaling: A subset of spear phishing, this targets high-level executives or decision-makers, aiming to trick them into authorizing large financial transactions or revealing critical company information.

Smishing and Vishing: Phishing attacks via SMS (smishing) or voice calls (vishing) occur when attackers impersonate trusted entities like banks or employers.

 

The Cost of Falling for Phishing

The cost of falling for a phishing attack can be significant for small and medium-sized businesses (SMBs), often extending beyond just immediate financial losses. Here’s a breakdown of the various costs an SMB may face after a phishing attack:

 

Direct Financial Losses

Phishing attacks often result in financial fraud, such as unauthorized transfers, fraudulent payments, or the theft of sensitive business data. These breaches can lead to significant financial losses. In fact, IBM’s study, Cost of a Data Breach Report 2024, the global average cost of a data breach in 2024 reached $4.88 million—a 10% increase from last year and the highest ever recorded.

 

Ransomware Costs

Phishing is often the gateway to ransomware attacks, where cyber criminals encrypt a company’s data and demand payment to restore access. Cybersecurity Ventures predicts ransomware will cost victims around $265 billion annually by 2031, with a new attack striking every 2 seconds. Even if a ransom is paid, there’s no guarantee that the data or systems will be fully restored.

 

Operational Downtime

Following a successful phishing attack, businesses often experience significant downtime as they work to recover systems, restore data, and address security vulnerabilities. Recovery from a cyber attack can take anywhere from a few days to several months, with ransomware incidents averaging around 24 days, according to Varonis. The recovery timeline can vary based on factors like encryption type and the complexity of forensic investigations, severely impacting operations, productivity, and revenue.

 

Reputation Damage

Phishing attacks can lead to data breaches that expose sensitive customer or partner information. This can damage a company's reputation, eroding trust with clients and stakeholders. For SMBs, which rely on customer loyalty and word-of-mouth marketing, the reputational damage could be devastating, leading to customer churn and loss of future business.

 

Legal and Compliance Fines

SMBs may face legal and compliance penalties if they fail to protect sensitive data, especially in regulated industries like finance, automotive, or e-commerce. For instance, businesses that process credit card payments must comply with the Payment Card Industry Data Security Standard (PCI DSS). Failure to meet PCI compliance can result in fines ranging from $5,000 to $100,000 per month until compliance is achieved. These fines can come from payment processors or acquiring banks, and repeat offenses can lead to the suspension of card processing capabilities, severely impacting the business.

 

Cybersecurity Insurance Premiums

Falling victim to a phishing attack can increase a business's cybersecurity insurance premiums. Insurers may raise rates after a breach or require stricter security measures to renew policies. Even with insurance, deductibles and non-covered expenses can leave SMBs shouldering significant costs.

 

Considering these factors, the total cost of a phishing attack for an SMB can easily reach hundreds of thousands to millions of dollars, depending on the severity of the breach.

 

Warning Signs of Phishing

While phishing scams are evolving, there are still red flags to watch for:

Urgency: Phishing emails often create a false sense of urgency, pushing you to act without thinking.

Unfamiliar Sender: Be cautious of emails from unknown sources, especially those requesting personal information.

Suspicious Links: Hover over links to check the actual URL. If it seems off, don’t click.

Grammar Issues: Phishing emails often contain grammatical errors or awkward phrasing, though attackers are improving their language skills.

Requests for Sensitive Information: Legitimate organizations rarely ask for sensitive information via email. If you receive such a request, it’s likely a phishing attempt.

 

How to Protect Yourself and Your Business

Protecting against phishing requires a combination of education, technology, and vigilance:

 

Educate and Train Employees

Phishing attacks often target human error, making employee awareness crucial. Regular, engaging training sessions should cover the latest phishing techniques, social engineering tactics, and real-life examples.

Businesses can implement this by setting up quarterly or bi-annual training programs using webinars, short videos, or even gamified platforms to keep employees engaged and informed.

 

Implement Multi-Factor Authentication (MFA)

Multi-factor authentication (MFA) adds an extra security layer beyond passwords, significantly reducing the chances of account compromise. According to a Microsoft study, MFA blocks over 99.9% of account compromise attacks.

Businesses can enable MFA across critical systems like email and financial accounts, making high-risk users such as executives or staff handling sensitive data mandatory and auditing usage to ensure compliance.

 

Use Anti-Phishing Tools

Anti-phishing tools, such as email filtering software or browser extensions, can detect and block phishing attempts before they reach employees’ inboxes. These tools often come with machine-learning capabilities that analyze email patterns and flag suspicious content.

Businesses can invest in comprehensive security solutions that integrate anti-phishing features into their existing software, ensuring seamless protection across the board.

 

Regularly Update Software

Cyber criminals often exploit vulnerabilities in outdated software to launch phishing attacks. Keeping systems, browsers, and security software up to date is essential for protecting against the latest threats. Businesses should establish a routine patch management process to automatically update all systems, reducing the risk of exploitable weaknesses in their infrastructure.

 

Test Your Defenses

Conducting phishing simulations helps businesses test how well employees respond to phishing attempts and reinforces vigilance. These simulations mimic real phishing tactics, allowing organizations to identify weaknesses and retrain staff accordingly. By regularly conducting these tests, companies can measure progress and continually enhance their defense strategies.

 

Regular penetration tests and vulnerability scans are essential for helping businesses identify potential breaches and uncover significant risks that need mitigation.

Education is key—equipping your team with the knowledge and tools to recognize and thwart phishing attacks is your first line of defense.

 

What to Do If You Fall for a Phishing Scam

Despite your best efforts, you can fall victim to a phishing attack. If this happens:

Act Quickly: Change your passwords immediately, especially for any compromised accounts.

Report the Incident: Notify your IT or security team, or if you’re an individual, report it to your email provider and relevant financial institutions.

Monitor Your Accounts: Keep a close watch on your bank accounts and credit reports for any unauthorized activity.

Learn from the Experience: Analyze how the phishing attempt succeeded and use it as a learning opportunity to strengthen your defenses.

Phishing scams are a constant cyber threat, but with the right knowledge and precautions, you can significantly reduce your risk. Stay informed, stay cautious, and always think twice before clicking.

By implementing the strategies outlined in this guide, you can protect yourself, your employees, and your business from the costly consequences of phishing attacks.

One Step Secure IT has a team of cybersecurity experts that can answer questions about your business’ cybersecurity strategy. Learn more about our Cybersecurity Services.