According to a report by the Identity Theft Resource Center, the government and education sectors accounted for 12.3% of all reported data breaches in 2020. Increased connectivity has benefitted state and local government and education (SLED) since its inception, increasing efficiency, information sharing, and more. As the internet has developed and threat actors become more savvy, it has introduced more risk to state and local organizations. The dark web, also known as the hidden internet, is a part of the internet that is not indexed by traditional search engines. It is estimated that the dark web is 500 times larger than the surface web, making it a haven for illegal activities such as fraud and cyber crime.
The increasing prevalence of dark web fraud has become a significant concern for SLED institutions. These entities hold a vast amount of sensitive data, making them prime targets for cyber criminals on the dark web. This alarming trend highlights the urgent need for these entities to take proactive measures to protect themselves from dark web threats.
To address this growing concern, Digital Risk Protection Services (DRPS) offers a comprehensive solution for monitoring the dark web for potential threats. In this whitepaper, we will delve deeper into the issue of dark web fraud and the importance of implementing a proactive threat intelligence monitoring solution for state and local government agencies and education institutions.
- Understanding Dark Web Fraud Threats
- How Dark Web Threats are Evolving
- Challenges Faced by SLED Organizations in Combatting Threats
- Strategies for Mitigating and Preventing Dark Web Fraud
- Introducing Digital Risk Protection Services
- Benefits of Digital Risk Protection Services
- Best Practices for Implementing Digital Risk Protection Services
- Download the Whitepaper
Understanding Dark Web Fraud Threats
The dark web is a part of the internet that is not accessible through traditional search engines or standard web browsers. It requires specific browsers and configurations to access, making it a haven for illegal activities. The dark web is often used for illegal transactions and communication, making it a breeding ground for various fraud threats. Three of the most common threats that GroupSense observes for our SLED clients on the dark web include: unemployment and benefits fraud, compromised credentials, and data breaches.
Unemployment and Benefits Fraud Domain Spoofing
Unemployment fraud has become a significant issue for SLED in recent years, especially after the COVID-19 pandemic created more opportunities for threat actors after the large increase in unemployment claims. The dark web makes it easier for fraudsters to carry out unemployment fraud by using domain spoofing techniques. Domain spoofing involves creating a fake website that looks like a legitimate one, tricking users into giving away personal information such as social security numbers and bank account details. In the case of unemployment fraud, scammers create fake unemployment websites to collect personal information from unsuspecting victims, often using the dark web to sell that data.
Domain spoofing enables threat actors to harvest not only personally identifiable information (PII), but also allows them to reroute funds to their accounts. By providing login information, unknowing users of the fraudulent sites give up their banking credentials or account numbers to the fraudsters.
Compromised Credentials
The dark web is also a hotbed for stolen and compromised credentials. These credentials, such as usernames and passwords, are often obtained through data breaches and sold on the dark web. This becomes a larger issue when individuals are reusing credentials from other websites that are then implicated in a breach. In a report by Google Cloud, they found that credentials account for 60% of compromise factors. Cyber criminals can use these credentials to gain access to SLED systems and carry out various fraudulent activities, such as identity theft and financial fraud. The dark web provides a marketplace for these stolen credentials, making it easier for criminals to access them and carry out their fraudulent activities.
Data Breaches and Information Leaks
Data breaches and information leaks are a major concern for SLED, as they can result in the exposure of sensitive information for constituents and employees of state organizations. Cyber criminals can use this information for various fraud schemes, such as identity theft, financial fraud, and even extortion. The dark web provides a platform for the sale and distribution of this stolen information, making it easier for criminals to profit from their illegal activities and further incentivizing breaches. It also introduces risk for secondary ransomware attacks, in which threat actors will hit a breached organization with ransomware after obtaining stolen data.
The dark web poses a significant threat to SLED, mainly due to the ease of access and anonymity it provides to cyber criminals. Unemployment fraud, compromised credentials, and data breaches are prevalent types of fraud threats that SLED must be vigilant against. It is essential for SLED institutions to stay informed about the dark web and its potential threats to effectively combat fraud and protect its citizens.
How Dark Web Threats are Evolving
The dark web is not only a haven for experienced cyber criminals, but is now a place where the average person can become a threat actor in a days work. As technology continues to advance, fraudsters are also evolving their tactics to stay ahead of law enforcement and security measures. This section will explore the emerging trends and tactics used by fraudsters on the dark web, as well as the challenges faced by state and local government and education institutions in combating these threats.
Emerging Trends and Tactics Used by Fraudsters
Fraud Kits for Sale on Dark Web
One of the most alarming trends on the dark web is the availability of fraud kits for sale. These kits come with step-by-step tutorials and all the necessary tools for conducting various types of fraud, such as identity theft, credit card fraud, and phishing scams. These kits are easily accessible and affordable, making it easier for even inexperienced fraudsters to carry out successful attacks. Threats like these fraud kits create a lot more traffic and noise that cyber analysts have to deal with. But there aren't enough qualified professionals to monitor the dark web for threats, leaving SLED organizations exposed to higher levels of threats.
Fraudulent Advertising
Another tactic used by fraudsters is advertising their spoofed domains on Google to push their nefarious websites to the top of search results, effectively tricking the average person into choosing their spoofed domain instead of the legitimate site. This not only exposes individuals to potential fraud but also increases the reach and visibility of these fraudulent activities, creating a higher financial cost to SLED organizations.
Malicious Domains and Spoofed Websites for Credential Harvesting
Fraudsters also use malicious domains and spoofed websites to gather sensitive information from unsuspecting victims. These sites may appear to be legitimate, but they are designed to trick users into entering their personal information, such as login credentials or banking details. This information is then used for identity theft or other fraudulent activities.
Analysis of the Challenges Faced by State and Local Government and Education Institutions in Combating These Threats
- Limited Resources and Budgets
SLED institutions often face limited resources and budgets, making it challenging to invest in robust cybersecurity measures. This lack of resources makes them vulnerable to cyber attacks, including those originating from the dark web.
- Lack of Expertise and Knowledge About Dark Web Fraud
Many SLED institutions may not have the necessary expertise and knowledge about the dark web and its potential threats. This lack of understanding can make it difficult for them to identify and combat fraudulent activities originating from the dark web.
- Difficulty in Identifying and Tracking Fraudulent Activities
Fraudsters on the dark web are constantly changing their tactics, making it challenging for SLED institutions to identify and track fraudulent activities. This can lead to delayed detection and response, allowing fraudsters to continue their activities undetected.
Strategies for Mitigating and Preventing Dark Web Fraud
To effectively combat the evolving landscape of dark web fraud threats, SLED institutions must implement robust strategies and measures. These may include:
Investing in Cybersecurity and Fraud Prevention Tools
SLED institutions should invest in cybersecurity solutions and fraud prevention tools to protect their networks and systems. Proactive monitoring of the deep and dark web should provide high-fidelity, finished intelligence that enables institutions to get ahead of threat actors. Threat intelligence solutions also provide strong defense against fraud schemes so your organization can implement proactive measures. When evaluating tools and solutions, it’s important to identify whether your team will receive threat alerts, or finished intelligence. Alerting works better for larger teams with the resources to weed through threats, while finished intelligence might work better for smaller teams that benefit from actionable suggestions.
Collaborating with Law Enforcement and Other Organizations
Collaboration with law enforcement and information sharing with other organizations can help SLED institutions stay informed about the latest dark web fraud trends and tactics targeting similar institutions. Keeping in touch with other organizations about threats they are seeing protects your institution, enabling you to put proactive defense measures in place.
Conducting Regular Security Assessments and Audits
Regular security assessments and audits can help identify vulnerabilities and weaknesses in the organization's systems and processes. Including vendors and third parties in audits identifies security gaps that organizations may miss otherwise.
Educating Employees and Implementing Strong Security Protocols
Employee education and strong security protocols are crucial in preventing dark web fraud and cyber incidents. SLED institutions should educate their employees on how to identify and avoid potential threats and implement strong security protocols for handling sensitive information. We recommend reading through our guide on implementing cyber hygiene measures to strengthen your organization.
Monitoring and Analyzing Dark Web Activity
SLED institutions should monitor and analyze dark web activity to stay ahead of the latest fraud trends and tactics. If the organization does not have the right personnel for proactive monitoring, GroupSense recommends hiring a vendor that can provide high-fidelity finished intelligence on your attack surface. This can help in proactively identifying and preventing potential attacks.
Keeping Up with the Latest Fraud Trends and Continuously Adapting Strategies
Finally, it is crucial to stay informed about the latest fraud trends and continuously adapt strategies to combat dark web fraud effectively. This may involve regular training and education for employees and staying updated on emerging technologies and techniques used by fraudsters.
The evolving landscape of dark web fraud threats poses a significant challenge for state and local government and education institutions. However, by investing in cybersecurity measures, collaborating with law enforcement and other organizations, and continuously adapting strategies, these institutions can mitigate and prevent the impact of dark web fraud. It is crucial to stay proactive and vigilant in the fight against these evolving threats to protect sensitive information and maintain the trust of citizens and students.
Introducing Digital Risk Protection Services
SLED organizations must be prepared to face increasingly sophisticated cyber attacks. To combat this growing threat, companies need comprehensive and proactive protection measures in place. This is where Digital Risk Protection Services (DRPS) come into play.
What Digital Risk Protection Services Should Include
DRPS is designed to protect businesses and organizations from the risks associated with the dark web, including stolen credentials, sensitive data, and financial losses. These services utilize advanced technology and techniques to monitor, detect, and mitigate threats on the dark web. Key features of DRPS include real-time monitoring, dark web threat intelligence, and a dedicated analyst that works with your team.
How Digital Risk Protection Services Adapt to Threats
Strong Digital Risk Protection Services are made to withstand the evolving threat landscape. When evaluating service providers, it's important to look out for certain features. Whether the program uses technology, people, or a combination of both to monitor, they should do the following:
- Real-time monitoring and detection of compromised credentials
DRPS continuously monitor the dark web for any compromised credentials, such as usernames and passwords. This allows businesses to take immediate action and prevent unauthorized access to their systems.
- Dark web threat intelligence and proactive threat hunting
DRPS use advanced tools and techniques to gather intelligence on dark web forums, marketplaces, and other online criminal activities. This information is then used to proactively hunt for potential threats and prevent them from causing harm. Look for a vendor that also uses human analysts that can provide valuable context and reduce false alerting.
- Incident response and remediation support
In the unfortunate event of a data breach or cyber attack, DRPS should either provide incident response and remediation support or work with your organization’s incident response provider. This might include identifying the root cause of the incident, mitigating the damage, and implementing measures to prevent future attacks.
Case Study: Successful Prevention of Dark Web Fraud
GroupSense observed increased fraudulent domains of a large state's unemployment benefits website in the Western United States. Threat actors were spoofing legitimate benefits sites and even paid for Google advertising to increase credibility and redirect traffic toward their scams. Over 1,000 people entered their official credentials into the fraudulent websites, granting the threat actors access to billing and payment details that enabled them to redirect the unemployment funds to their own accounts.
After GroupSense found these websites, we notified the state's Department of Labor of the fraud. The state was able to send out communications to residents of the state warning them of the scam, preventing others from falling prey to the threat actors. By promptly implementing a comprehensive cybersecurity solution, the state was able to identify and block a significant number of fraudulent attempts originating from the dark web, working with GroupSense to perform domain takedowns on the fraudulent sites. Ultimately, GroupSense's work resulted in the domains being suspended by the domain registrars. Proactive cyber solutions like these can protect other states and their residents from harm in the future.
Benefits of Implementing Digital Risk Protection Services
The benefits of implementing DRPS are numerous and include:
Protecting sensitive data and preventing financial losses
By continuously monitoring the dark web for compromised credentials and other threats, businesses can protect their sensitive data and prevent financial losses caused by cyber attacks.
Maintaining brand reputation and trust
A data breach or cyber attack can damage an organization's reputation and erode trust. By implementing DRPS, businesses can demonstrate their commitment to protecting customer data and maintaining their trust by reducing cyber attacks.
Complying with regulatory requirements
Many industries are subject to regulatory requirements regarding the protection of data. By implementing DRPS, organizations can ensure they are compliant with these regulations and avoid potential penalties and legal consequences.
DRPS offers a comprehensive solution that adapts to the evolving dark web landscape and helps mitigate the risks of cyber crime. By implementing these services, SLED organizations can protect their sensitive data, maintain their reputation, and comply with regulatory requirements, ultimately safeguarding their operations and customers from the dangers of the dark web.
Best Practices for Implementing Digital Risk Protection Services
In order to effectively protect SLED institutions from digital risks, it is crucial to have a comprehensive understanding of their unique needs and risk profile. This requires a thorough assessment of the organization’s digital assets, potential threats, and vulnerabilities.
Assessing Unique Needs and Risk Profile
The first step in implementing DRPS is to identify and prioritize the specific risks that are most relevant to the organization. This can be done through a risk assessment, which involves evaluating the organization’s digital infrastructure, data, and operations to identify potential vulnerabilities and threats.
The risk assessment should also take into account the organization’s size and regulatory requirements. For example, a small local government may have different risk profiles and needs compared to a large state agency. It is important to tailor the risk assessment to the specific organization to ensure that the services are effective and efficient.
In addition to assessing the organization’s digital risks, it is also important to understand the unique challenges and constraints faced by SLED institutions. These may include limited budgets, resource constraints, and complex procurement processes. By understanding these factors, digital risk protection services can be tailored to meet the specific needs and requirements of the organization.
Integrating Digital Risk Protection Services into Existing Cybersecurity Frameworks
DRPS should not be seen as a standalone solution, but rather as a complementary component of an organization’s overall cybersecurity framework. This means that they should be integrated into existing security processes and technologies, such as firewalls, intrusion detection systems, and data loss prevention tools.
By integrating DRPS into existing cybersecurity frameworks, organizations can achieve a more holistic and layered approach to threat mitigation. This also ensures that the services are aligned with the organization’s overall cybersecurity strategy and objectives.
Collaboration with Internal Stakeholders and External Partners
Effective implementation of DRPS also requires collaboration with internal stakeholders and external partners. This includes working closely with IT teams, security teams, and other departments within the organization to ensure that the services are properly integrated and aligned with their needs and requirements.
In addition, collaboration with external partners such as cybersecurity vendors and threat intelligence providers can bring additional expertise and resources to the table. This can help organizations to stay abreast of the constantly evolving digital landscape.
A holistic approach to threat mitigation involves not only protecting the organization’s own digital assets, but also monitoring and addressing risks that may originate from third-party vendors and partners. Therefore, it is important to collaborate with these external entities to ensure comprehensive protection.
In today’s digital landscape, SLED institutions face a wide range of digital risks that can compromise the security of their data and operations. By following best practices for implementing digital risk protection services, organizations can better understand their unique needs and risk profiles, integrate these services into their existing cybersecurity frameworks, and collaborate with internal and external stakeholders for a holistic approach to threat mitigation. This will ultimately help to safeguard the organization’s digital assets and maintain the trust of the public and stakeholders.
