Cybercriminals Are Faking Data Breaches: How AI Is Fueling This New Scam

Just when you think cybercriminals have exhausted their bag of tricks, they come up with new, creative ways to scam people. Their latest tactic involves faking data breaches to steal money from unsuspecting business owners and dark web data buyers alike.

Earlier this year, Europcar, a global car rental company based in France, discovered a cybercriminal selling private information about its 50 million+ customers on the dark web. The company promptly launched a formal investigation, only to find out that the data being sold was fake. The information was fabricated, likely with the help of generative AI.

How Did They Do It?

With AI-powered tools like ChatGPT, cybercriminals can quickly generate realistic-looking data sets. Savvy cybercriminals conduct thorough research and design data sets that appear complete, with correctly formatted names, addresses, and emails, even including local phone numbers. They also use online data generators that can swiftly create large, fake data sets intended for software-testing purposes, making the data look authentic. Once these data sets are ready, hackers choose a target from which they claim to have stolen the data and post the information on the dark web.

Why Are They Doing It?

Why would a hacker fake a data breach? Several reasons come to mind, beyond reaping the benefits without the effort of breaching a network's security system:

1. Creating Distractions: One effective way to lower a company's defenses is to divert its attention elsewhere, such as making it focus on finding a breach in its system. The company will be so intent on locating the supposed entry point that it may overlook an attack from another angle.
2. Bolstering Their Reputation: In the hacker community, reputation is highly valued. Targeting a well-known brand publicly can earn them notoriety and attract attention from other hacker groups.
3. Manipulating Stock Prices: For publicly traded companies, a data breach can cause a rapid 3% to 5% (or more) drop in stock prices. This can create widespread panic, allowing cybercriminals to manipulate stocks for financial gain.
4. Learning Security Systems: Faking a data breach can give cybercriminals insight into a company's security processes for preventing, detecting, and resolving attacks. Understanding threat response times and security capabilities can help them fine-tune their attack strategies.

Why Is This Bad for Businesses If the Data Is Fake?

Even if the data is fake, the damage is done by the time the public becomes aware. For instance, in September 2023, Sony was targeted by a ransomware group that claimed to have breached the company's network and acquired its data. The breach was widely reported, tarnishing Sony's brand. By the time the investigation concluded that the hacker's claim was false, the damage to their reputation was irreparable.

What Can You Do to Prevent Fake Data Breaches?

To avoid becoming a victim of a fake data breach, consider these steps:

1. Actively Monitor the Dark Web: You or your cybersecurity team should routinely monitor the dark web. If you find someone selling your data, investigate the claim immediately to prevent extensive damage.
2. Have a Disaster Recovery Plan in Place: Develop a communication plan in advance so your team knows what to say if a data breach occurs. Fine-tune this plan as needed.
3. Work with a Qualified Professional: Focus on what you love to do and leave IT-related issues to the experts. Partnering with a cybersecurity professional who knows what to look for, how to resolve issues, and how to prevent breaches can give you peace of mind and ensure that monitoring and disaster recovery plans are effectively managed.

Data breaches can create enormous problems for your organization. Get ahead of the issue and have someone proactively monitor your network and the dark web to keep you secure. If you want a no-obligation, third-party opinion on whether or not your network is vulnerable to an attack or properly secured, we're happy to provide one for FREE. Call us at 707-689-3999 or click here to book your FREE Cyber Strategy Session with one of our cybersecurity experts.