Phishing scams are a serious threat to small and medium-sized businesses (SMBs), with many SMBs now turning to cybersecurity consulting firms in NYC to protect against the growing risk of these cyberattacks. The prevalence of phishing scams – including spear phishing and vishing – has risen dramatically in recent years as cybercriminals exploit human error to access sensitive information, causing data breaches and ransomware attacks that can result in severe financial loss.

One recent study, in fact, found that 84% of organizations suffered a successful phishing attack in 2022. Worse, 43% of these cyberattacks targeted small businesses, with each costing an average of $2.2 million. While most large corporations can handle that kind of hit to their reputation and bottom line, many small businesses simply can’t survive the ramifications of a phishing attack, with nearly 60% of small operations going out of business within six months following an attack due to lost revenue, legal fees, and ransom payments. Though the hybrid work model has benefits, it has only heightened the threat.

In this blog, we’ll examine the growing risks of phishing attacks, including the tactics used by cybercriminals, and explain how partnering with a cybersecurity consulting firm can help neutralize the threat.

Cybersecurity Threats for Small Business: What Are Phishing Scams?

Simply put, phishing attacks are a form of cybercrime where attackers impersonate legitimate organizations to deceive individuals into revealing sensitive information. This could mean login credentials, financial details, or personal data. These attacks often occur through what seem like real emails, phone calls, or websites that are designed to trick the victim into believing they are interacting with someone trustworthy and verifiable. Once the attackers have obtained the info they seek, they then use the stolen information to commit fraud, steal money, or gain unauthorized access to systems and data.

Small and medium-sized businesses are particularly vulnerable to phishing attacks. This is true for several reasons, most notably:

• Lack of a robust cybersecurity infrastructure and resources


• Fewer IT staff and less cybersecurity training


• Increasing number of employees working remotely


• Belief that cybercriminals only go after “big fish”

The Impact of Phishing Scams on Small Business

A successful phishing attack can devastate a small business by impacting its financial stability, reputation, and operational capabilities. These consequences can be wide-ranging and severe, frequently resulting in long-term damages that can be especially difficult for SMBs to overcome.

Financial Losses

While unauthorized transactions or ransom payments can lead to direct financial losses, the costs extend beyond immediate monetary theft, encompassing business downtime, data recovery, and remediation efforts. Legal fees and penalties might also arise if the breach results in non-compliance with data protection regulations.

Operational Disruption

A phishing attack will often disrupt business operations by crippling IT systems or stealing critical data. If attackers gain access to a company's financial systems, for instance, they can lock employees out of accounts, prevent transactions, or manipulate data, all of which can halt business processes and lead to lost revenue and diminished productivity.

Reputational Damage

The reputational impact of a phishing attack is hard to quantify, but it can be severe nonetheless. News of a breach can spread quickly, potentially deterring new customers and harming existing relationships. Rebuilding trust and reputation is a lengthy and costly process, requiring significant investment in public relations and customer compensation efforts.

Legal and Regulatory Consequences

Businesses affected by phishing attacks may face legal challenges if customer data is compromised. This can result in regulatory fines, lawsuits, and increased scrutiny from governing bodies, which only compound the effects of the cyberattack.

Long-Term Impacts

The long-term impacts of a phishing attack can include increased cybersecurity insurance premiums, the need for extensive investment in cybersecurity measures, and employee training. Businesses may also face ongoing financial strain due to lost business opportunities and the cost of rebuilding customer trust.

Real-World Example: FACC AG

If you’re looking for a real-world example of the damage a phishing attack can have on a business, look no further than the case of FACC AG, an Austrian aerospace parts manufacturer. In 2016, FACC fell victim to a phishing attack known as the "CEO fraud" – also referred to as a “whaling attack” or the “fake president” scheme – where attackers impersonated the CEO and instructed the finance department to transfer approximately $55 million to foreign accounts. The attack was successful, resulting in a significant financial loss and the dismissal of both the CEO and the CFO. The attack severely impacted the company's financial standing, causing a temporary dip in its stock price and damaging its reputation in the industry.

How Can Cybersecurity Companies in NYC Help Prevent Phishing Attacks?

To effectively prevent phishing attacks, small and medium-sized businesses (SMBs) can take several proactive measures, none more impactful than partnering with one of the many cybersecurity consulting firms in NYC. These firms bring expertise, resources, and tailored solutions that can enhance an organization’s cybersecurity posture. Here are some of the key benefits:

1. Expertise and Experience

• Access to Specialized Knowledge: Cybersecurity consulting firms have experts with in-depth knowledge of the latest phishing techniques and trends, and they can offer insights into how attackers operate while identifying potential vulnerabilities and providing guidance on effective prevention strategies.

2. Tailored Security Solutions

• Customized Assessments and Training Programs: Consulting firms conduct comprehensive security assessments tailored to the specific needs and vulnerabilities of each SMB and help develop customized training programs that educate employees on recognizing phishing attempts and responding effectively. This personalized approach ensures that security measures address the business's unique risks.

3. Advanced Technology Implementation

• Access to Cutting-Edge Tools: Consulting firms provide SMBs with access to advanced security technologies, such as AI-driven email filters, threat detection systems, and multi-factor authentication (MFA). Additionally, they ensure seamless integration of security tools into existing IT infrastructure, minimizing disruptions and ensuring optimal performance.

4. Proactive Threat Management

• Continuous Monitoring & Threat Intelligence: Consulting firms offer continuous monitoring services to detect and respond to phishing threats in real time, while also providing SMBs with access to up-to-date threat intelligence, allowing businesses to stay informed about emerging phishing tactics and vulnerabilities.

5. Cost-Effectiveness

• Reduced Risk of Financial Loss: By preventing phishing attacks, consulting firms help SMBs avoid the significant financial losses associated with phishing attacks. They also offer scalable solutions that grow with the business, providing SMBs with flexible and cost-effective options that align with their budgets and evolving needs.

6. Improved Incident Response

• Well-Defined Response Plans & Rapid Recovery: Consulting firms assist in developing and implementing robust incident response plans and, in the event of an attack, help SMBs minimize downtime and data loss through rapid recovery strategies and support.

7. Enhanced Compliance and Reputation

• Regulatory Compliance & Reputation Management: Consulting firms make sure that security measures align with industry regulations and standards, reducing the risk of legal penalties and improving compliance with data protection laws. Relatedly, by preventing successful phishing attacks, consulting firms help protect the business’s reputation and maintain customer trust.

To sum up, cybersecurity consulting firms offer SMBs a comprehensive suite of services and solutions that significantly reduce the risk of phishing attacks. By leveraging their expertise, advanced technologies, and tailored approaches, SMBs can build robust defenses, protect their assets, and ensure the continuity and growth of their business in an increasingly digital world.

If you’re ready to partner with a proven IT consulting firm to help your small business protect itself from the many ramifications of a successful phishing attack, reach out to the IT experts at Computer Resources of America today!