It seems like every other day institutions big and small are experiencing some form of cyberattack. Local governments, banking institutions, tech and networking companies have undergone some sort of cyber breach. However, accounting firms are likelier than other businesses to fall victim to a cyberattack due to the wealth of sensitive client information they store in order to conduct business.

Since cybercriminals are always exploiting vulnerabilities and finding new malware to access financial information of accounting clients, it’s important to understand cyber threats your firm faces in 2020. So when an accountant thinks about cyber risks they’re susceptible to they think about attacks from outside the firm. Unfortunately, the cyber threats that could negatively impact the firm are ones that firms are responsible for. The good news is they can be prevented.

Here are five  main vulnerabilities CPA’s face today.

Why are CPA Employees at the Root of a Data Breach?

1) Human Error

Human error is the leading cause of accounting mistakes and it’s also the leading cause of cyber security threats. 90 percent of data breaches are caused by human error, according to a study by Kaspersky.

Bring your own device (BYOD) culture puts financial firms at risk when accountants neglect to check their network security. If an accountant has sensitive data on their personal device and decides to go to a coffee shop like Starbucks, it’s possible that a hacker can access that information because the user’s connected to a vulnerable, public wifi network.

Solution

Establish strict guidelines to limit the use of personal devices when handling accounts and client data.

2) Weak Passwords

Among the most common mistakes accounting professionals make is setting up weak passwords for accounts. Accountants should create separate passwords for their email, applications, and systems according to best practices. The reality is accountants, like many other people, tend to use the same password for all three. As a result, they make a hacker’s job much easier.

Passwords are a lot like keys. Imagine if you had one key for your house, your car and your business.  All anyone has to do to ruin your life is get hold of that key. Now, lets push this analogy even further. Imagine that same universal key. Not only does it provide access to all these valuable things but every night before you go to bed you leave it under a flowerpot outside for safe keeping. It might not be as obvious as leaving it out in the open, but it wouldn’t take long to find.

That is exactly what accountants do online. They create passwords that are easy for them to remember. Passwords are often anniversary dates, names of pets or loved ones, or the schools they studied in. Like the key in the flowerpot, a thief might not know exactly where it’s is hidden, but after some snooping around and persistence, they’d find it.

Social Media is a Hackers’ Greatest Tool

In today’s world of social media and online communication, personal information is available to everyone willing to look for it. A cyber criminal just needs to do a minimum amount of work looking through social media accounts to find anniversary dates, names of pets or loved ones, and the schools a target studied in.

That’s not to say accountants should rid themselves of all social media and eliminate their online presence. That’s a very extreme approach and, more importantly, is impossible. We shop online, we bank online, we purchase food online, we buy tickets online. All these things create a profile of who you are and can be leveraged to gain access to your accounts.

Solution

It is essential for accountants to set strong passwords for all their accounts. What are strong passwords? A strong password is a combination of letters (capital and lowercase), special characters like punctuation marks, and numbers or numerals. Stay away from passwords relating to your personal life as often as possible. A hacker will use whatever information they can to infiltrate a firm.

To avoid this firms should consider simple security methods like having users change their passwords monthly or at least quarterly and limit access through mobile devices. Also using multi-factor authentication software when accessing accounts can prevent breaches.

3) Phishing

This leads me to the next cybersecurity danger CPA’s face: Phishing. Phishing emails are used to manipulate the reader to click on a link or attachment infected with malware or a virus. They are a form of social engineering. Whether  you’re a large firm or small you’re vulnerable because statistics are on the hacker’s side.  All it takes is one successful attempt to access the firm’s data. In other words, they only need to trick one employee to access the firm’s data.

Phishing attacks a varied and wide-ranging. They can come in the form of a credit card alert, a notice from a non-profit, a package shipment delay and others. However, now that there’s more awareness of phishing scams, scammers adapted to make attacks even more believable by hyper focusing on a specific target.

A target phishing email is known as spear phishing. Cybercriminals use everything they can find on the target to legitimize the email. They’ll make references to people in your life, places you’ve lived in, things that you’ve done to give you a false sense of security. For example, if you get an email from a store you’ve shopped at offering you deals on products you’re likely to buy, you’re likelier to open the email without question.

Avoiding spear phishing attacks means having the proper securities in place and training personnel to create a security first culture. Businesses can use phishing simulations to train accountants to recognize them also.

4) Malware

Malware is installed through a phishing email attachment or link to an infected web page. The scary thing about malware is that it can stay dormant for weeks or even months before it’s used to steal information or take over systems. There are even ways to purchase malware online through the dark web. In other words, cyber criminals no longer need to be tech savvy to deploy malware. They can be anyone.

Solution

Since Malware is installed through social engineering, the solutions are the same.  Accounting firms should have protocols in place to alert IT personnel when a request comes in through email. Managed Service providers, like Nerds Support, have alert system that notifies systems engineers of potentially fraudulent emails.

Our e-book goes into more detail on the benefits of e-mail and spam security services.

5) Cryptojacking

Cryptojacking is relatively new and unlike malware attacks, its goal is to mine cryptocurrencies on behalf of the hacker by using the victim’s devices. They gain access to the devices by using phishing techniques. They imbed crypto mining malware in popular websites in the form of free browser extensions.

Crypto currencies are valuable to hackers because they’re untraceable and can be used for purchase and exchange on the dark web. Furthermore, the attractive thing about cryptojacking is that it runs secretly and can go undetected for a long time. And since nothing gets stolen or encrypted, there’s little incentive to do anything about it.

 Solution

Other than training firms should implement endpoint protection/antivirus software that detect crypto miners. IT support should create a continuity strategy in case of an attack.  Another thing you can do is keep track and maintain browser extensions.

Conclusion

An October 13 story by CNBC reported that Cyberattacks cost small companies $200,000 on average. 60% of the businesses attacked go out of business within six months. Accounting firms are among the most targeted types of businesses today. Moreover, cyber crime has become the fastest growing type of crime costing businesses 5.2 trillion worldwide in the next five years.

Pandora’s box has been opened and now more than ever CPA’s cannot afford to take unnecessary risks. Adopting strategies and continuity plans to limit the impact of cyberattacks and phishing scams is key.

P.S. Cloud accounting is a growing field and provides unique solutions to many of these problems. Click here to read our blog on why cloud backups are a good solution for CPA firms.