Account Takeover Protection: Risks, Targets and Prevention Strategies

When a customer signs up for a loyalty program or otherwise entrusts your organization with their personal and sensitive data, they’re counting on you to keep it safe. Expected account security features are a fine front line of defense, but sophisticated cybercriminals are constantly dreaming up ways to breach that initial wall and gain access to the goods — customer data.

Once a fraudster gains entry, there is little standing between them and a large payday, which can lead to financial and reputational consequences for your business. For example, bad actors may harvest sensitive data and hold it hostage until a ransom is paid, sell it on the dark web, or make purchases using stolen credit card information of your loyal customers — once they’re in, they have access to everything.

Thankfully, account takeover protection exists as a way to fortify your defenses against sly cybercriminals. Here, we’re discussing the impacts of account takeover, how it happens and how you can do more to keep your customer’s data safe from data breaches and other criminal activity online.

Account Takeover and How It Happens

Account takeover attacks, which are a form of identity theft, increased by 354% year-over-year in 2023. Such a dramatic increase in account takeover has led experts to predict a global financial loss of as much as $635 billion.

There are numerous ways that cybercriminals attempt to gain unauthorized access to customer accounts. These varied points of entry necessitate multiple layers of account security and even employee training to help mitigate risk.

Industries That Are Targets for ATO Attacks

ATO attacks can happen to nearly any type of business; however, it’s the ones that store highly sensitive data, such as financial information or healthcare records, that are prime targets for cyber attacks:

  • Financial institutions: Cybercriminals that target banks, credit unions and other financial institutions are often looking to steal money directly, make fraudulent purchases or access users’ personal financial data.
  • E-commerce websites: E-commerce platforms process a vast amount of customer data, including personal and financial information. A successful ATO can lead to unauthorized access to user accounts, enabling fraudulent purchases.
  • Healthcare: The healthcare industry handles a significant amount of sensitive patient information. ATO attacks can result in unauthorized access to medical records, leading to identity theft, insurance fraud or other malicious activities.
  • Gaming platforms: Many online games today sell virtual currency and digital assets that cost real money and/or hold real-world value. A cybercriminal may make fraudulent purchases, steal personal user data that are often linked to their online gaming accounts, or, in competitive online games, take over an account to cheat or gain an advantage.
  • Social media and other online platforms: Social media, email and other digital platforms are attractive targets for ATO attacks because they provide access to a wide range of personal and communication data. Cybercriminals may use compromised accounts for phishing, spreading malware and more.

Credential Stuffing Attack

Oftentimes, a cybercriminal will harvest swaths of customer usernames and passwords as part of a larger data breach. Once in possession of those login credentials, they’ll copy and paste them into other websites, hoping that users have recycled them across multiple accounts and gaining access that way.

Phishing Attack for Login Credentials

More of a social engineering tactic, phishing has been around for ages and is a go-to method for cybercriminals looking to carry out an account takeover.

Bad actors will often use deceptive communication and luring tactics, including creating fake login pages that mimic the real deal, in hopes of tricking consumers into handing over sensitive information.


A malware-based ATO attack uses malicious software that’s designed to infect, spy, record and harvest customers’ personal data. It accomplishes this in a few ways, such as:

  • Keylogging: Some types of malware, called keyloggers, record every keystroke a user makes, including usernames, passwords and other sensitive information entered during login sessions.
  • Spying: Forms of malware can actively monitor a user’s online activities to spy on login sessions and capture credentials as they are entered on legitimate websites.
  • Remote access: In more sophisticated cases of an ATO attack, some malware can grant cybercriminals remote access to a device, enabling attackers to perform actions on the victim’s behalf, including logging into various accounts.

Session Jacking

Bad actors looking to perform an account takeover attack may hijack an active user’s session. This “strategy,” often called session jacking, is a type of attack where an unauthorized party intercepts and steals an active session token to gain unauthorized access to an online account.

For context, every time a user logs into an online service, a session token is generated. This token is a piece of data that verifies a user’s identity and grants them access to their account without requiring them to re-enter their credentials with every interaction.

The Financial and Reputational Impacts of ATO Attacks

Account takeover attacks are not exclusive to any particular industry, although they are more common in some. For example, customer loyalty programs are a bright red target for cybercriminals looking to carry out ATO fraud, and many types of businesses have a program like that in place.

Without implementing the right ATO protections, organizations in these industries are at higher risk of:

  • Financial loss: Fraudulent transactions lead to higher volumes of refund requests from customers who have had their accounts compromised. Since organizations are responsible for fulfilling such requests while also losing out on their product (the fraudster isn’t going to return it), it leads to direct financial loss.
  • Reputational damage: Large or frequent successful ATO attacks against your organization can undoubtedly damage brand reputation. Consumers may begin to see your company as untrustworthy and incapable of protecting their private information. This can lead to less new business and lowered revenue.
  • Litigation: Organizations are held to strict consumer data privacy regulations that vary by state. Failure to uphold these standards may result in hefty fines, legal fees, lawsuits and lengthy proceedings that can put a strain on your resources, reputation and finances.

Account Takeover Protection: How To Safeguard Your Accounts With Authentic ID

There are a handful of strategies and tools that organizations can put in place to help prevent account takeover attacks, mitigate the damage caused when breaches do happen and strengthen security for future attacks.

Multi-Factor Authentication

Multi-factor authentication and two-factor authentication (MFA; 2FA), helps lock down your customers’ accounts to prevent stolen credentials and unauthorized access. This is accomplished by requiring users to verify themselves with two or more factors, including:

  • Something they know: Like a password or a PIN.
  • Something they have: Such as a security token, a smart card or a mobile device.
  • Something they are: Biometrics, including facial biometrics and/or selfies.

Frequent Password Changes

According to a Bitwarden survey, nearly half (44%) of respondents say that they “rarely” change their passwords for their online accounts. This can make them more susceptible to account takeover attacks, especially if they’re using the same credentials across various accounts.

To increase account security, your organization should consider implementing mandatory password resets for all users, about once every three months or so.

Comprehensive Authentication Methods: Fraud Detection and Prevention With Authentic ID Fraud Shield

Since cybercriminals carrying out ATO attacks use the identity of another, real person to commit crimes, businesses need a solution that can detect and reject bad actors quickly — and any second, third or fourth attempts they may make to gain unauthorized access to an account.

Fraud Shield from Authentic ID uses four methods for detecting and mitigating fraud, including account takeovers:

  • Biographical enrollment: Stop threat actors from using real IDs to commit fraud using face scanning technology and matching results with real, government-issued ID.
  • Bad actor watchlist: Stop fraudsters in their tracks by ensuring they never get a second chance to access your users’ accounts. If they try once, their IP address and other identifying information gets added to a blacklist to help you understand who’s a criminal and who’s a customer.
  • Bad document watchlist: Authentic ID uses AI-based decisioning to manage a list of fraudulent documents.
  • Biometric identification: It’s difficult for fraudsters and those looking to conduct account takeover attacks to recreate facial features to bypass user authentication methods that use face scanning technology.

Instill confidence in your users and protect their data. Ready to get started? Request a demo today.

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