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What Is Account Takeover Fraud?

What Is Account Takeover Fraud?

Jenius Bank Team9/2/2025
A woman sits at a table and attempts to enter her login to an account that has been taken over by fraudsters.
Account takeover scams are a type of fraud that targets online accounts.Every year, the Federal Trade Commission (FTC) receives roughly 2.4 million fraud reports from individuals. Of those 2.4 million reports, more than 600,000 resulted in lost money.1 Though the tactics fraudsters and cybercriminals use vary, many try to access and use others’ personal accounts for themselves. This type of financial scam is known as account takeover fraud. Account takeover fraud is on the rise and, according to some estimates, one in five Americans has experienced this type of crime in some way.2 The better you understand this type of fraud, the more equipped you may be to protect yourself. Here are some tips.

Key Takeaways

  • Account takeover fraud could happen with any account at any time.
  • Losing even temporary access to critical accounts could compromise your personal data, bring harm to your social reputation, and/or cause you to lose money.
  • Creating strong passwords and regularly updating your login credentials are two ways you could reduce your risk of becoming a victim of account takeover fraud.

What Is Account Takeover Fraud?

Account takeover fraud occurs whenever a cybercriminal takes over your online accounts, whether it’s your social media profiles, bank accounts, health accounts, online subscriptions, etc. They then use your account profile and impersonate you. This is a form of identity theft . As more people become reliant on mobile devices and computers, more cybercriminals are looking for ways to steal data through that technology. A common way they access your accounts is by compromising your credentials. However, fraudsters may also hack your account or employ phishing methods to trick you into giving them your data.Once these criminals have a way in, they usually try to lock you out of your own accounts, making it difficult to recover your access, your data, and potentially, your money.Account takeover fraud could happen in almost any industry. There’s certainly a heightened sense of awareness and concern when it comes to any place where sensitive financial data is stored. In recent years, social account takeovers have also been a growing issue, where the risk is damage to your social reputation.3

What Account Takeover Fraud Looks Like

As we mentioned, account takeover fraud could take several forms. Let’s look at some of the most common examples you may encounter4:
  • Loss of control of social media accounts: If a cybercriminal is able to impersonate you online, they could disseminate information that people believe is coming from you, including promoting scams. They will likely change your password and lock you out of the account, and while recovering your account is possible, it takes time.
  • Loss of control of email accounts: If a cybercriminal gains access to your email accounts, they may be able to request password resets for other accounts with your sensitive data.
  • Loss of control of financial accounts: Once a cybercriminal logs into your financial accounts, they may be able to make purchases and transfer money without you knowing.
These are just the most common types of account takeover fraud to look for. If you notice anything suspicious with your accounts, the first step could be to immediately change your password. Also, depending on the type of account, you may want to alert the company you have the account with. For example, if it’s your bank account, most banks would advise you to contact customer support and report unusual activities.

How Account Takeovers Happen

Cybercriminals constantly change their strategies to make it harder for people to detect them. However, here are some of the most common ways they work.5
  • Phishing: Phishing happens when fraudsters send an email or text message pretending to be a representative from a company or organization you trust, like your bank or even the IRS. These messages typically ask you to verify your account information, whether it’s your password or another login credential. If you give them the information, they could access your account and use it however they see fit.
  • Brute-force attacks: This method involves fraudsters simply guessing your credentials and forcing their way into your account. This is a huge risk for people who use simple passwords for most of their accounts.
  • Credential stuffing: Fraudsters have ways of gaining access to compromised data and login credentials, often on the black market or dark web. They may use this compromised data to try to gain access to different accounts.
  • Malware attacks: Malware is a type of malicious software used to monitor devices and track login credentials individuals enter on those devices. This is common on public computers, but you may also accidentally download it when you visit a questionable website.
Keep in mind that these are just a few of the most common methods fraudsters use. They may employ dozens of other tactics to gain access to your accounts.

How to Protect Yourself from Account Takeover Fraud

There are some actions that may help prevent account takeover fraud. Consider using the following tips in your efforts.6

Strengthen Your Passwords

Easy-to-guess passwords make taking over your account easier for experienced cybercriminals. Do what you can to strengthen your passwords across all of your accounts. Use unique passwords for each account too. And make sure those unique passwords include a mix of lowercase and capital letters, numbers, and symbols. For example, say you’re thinking of using the word “account” as your password. To help make it safer, try something like “!AcCount52*” instead.

Add Multi-Factor Authentication to Accounts if Possible

Multi-factor authentication lets you request a texted or emailed code anytime you log in to an account. Depending on the account, you may also be able to use biometrics like a fingerprint or facial ID to log in to your account. This helps ensure that cybercriminals can’t access your accounts even if they have your password and username. The only downside is that you’ll need to have your phone on hand when you’re trying to log in.

Update Passwords Regularly

You may not know when a cybercriminal has your password, but by changing your passwords on your most sensitive accounts often, you could help reduce the risk of your login credentials being compromised. And if you notice any suspicious activity on your account, be sure to update your password immediately. This could lock cybercriminals out of your account and help you keep access to your sensitive information.

Final Thoughts

Account takeover fraud has the potential to be costly if you’re not careful. But there are some steps that may help defend your data, reputation, and hard-earned money against cybercriminals. Keep in mind that account takeover fraud is just one form of identity theft that you’ll want to guard against. Check out our guide to learn how to help protect yourself from other forms of fraud.
Fraud & SecurityFinancial Wellness