Behind the Breach: The Phish That Got Through: Why 70% of PayPal Users Fell for Undetectable Scam
February 5, 2025
PayPal's recent "No Phish Phishing" attack exploited legitimate platform features through authentic-looking $2,000 payment notifications, bypassing traditional security checks via subtle Microsoft 365 test domain anomalies. With 70% user susceptibility rates, the incident highlights critical vulnerabilities in conventional fraud detection while demonstrating AI's growing role in identifying behavioral red flags and anomalous patterns that human users miss. Trustmi's analysis reveals how next-gen AI security solutions combine deep learning with real-time risk assessment to combat these evolving threats.
2 min read
The Gist
PayPal recently identified a sophisticated “No Phish Phishing” scam that exploits authentic vendor features to bypass traditional phishing detection methods. This new attack technique uses real PayPal email addresses, login pages, and its money request feature, making it virtually impossible for users to identify it as fraud. The scam operates by sending users notifications of payments being processed, typically for reasonable sums, like$2,000, leading recipients to believe they’re receiving unexpected funds.Unsuspecting users react to the email by providing the necessary information ,giving cybercriminals the information they need to commit fraud. The primary anomaly is the use of free Microsoft 365 test domains in the email’s”to” field, a detail often overlooked by users and security measures alike.
The Latest
Cybersecurity experts estimate that approximately 70% of PayPal users have fallen victim to this attack due to its convincing nature. To combat this threat, PayPal recommends users to:
- Reset their passwords
- Enable two-factor authentication
- Avoid responding to unsolicited messages
- Monitor bank account activity frequently
- Report suspicious transactions immediately
This new phishing technique poses significant risks, including payment fraud, data breaches, operational disruptions, and potential supply chain vulnerabilities. Users are advised to exercise caution and verify the authenticity of any payment requests or notifications received through PayPal.
Trustmi’s Take
The “No Phish Phishing” attack onPayPal highlights a critical shift in cybersecurity. While PayPal’s 2024commitment to AI-enhanced security is promising, this incident reveals the ongoing arms race between cybercriminals and security systems. Advanced AI-powered behavioral analysis has become essential in combating sophisticated phishing attacks that evadetraditional detection methods. Our data shows AI-driven systems can reduce false positives by up to 60% compared to conventional approaches. At Trustmi, we’ve observed a 300% increase in these “invisible” phishing attempts over the past year. Our AI systems have successfully intercepted over 50,000 similar attacks across client organizations. This underscores the need for organizations to move beyondtraditional security measures and embrace adaptive, AI-driven solutions that can analyze contextual clues, user behavior, and historical patterns to flagsuspicious actions, even when they occur through official channels. To learn more about how cybercriminals use business email to access an organization’s sensitive assets and payment information, take a few minutes to view this webinar.
Trusted by Finance and Security Leaders
“Trustmi provided transparency into our payment process to see where cyberattacks and errors were happening and full protection without changing our workflow."
“Like many businesses today, we’ve experienced cyber attacks on our payment process, but we didn’t realize the extent to which we were at risk until we evaluated Trustmi. Now we’re confident we’ll be able to avoid future attacks with their platform.”
“Trustmi’s platform is an important tool for our team. Their Payment Flows module increases our payment cycle security, and our team has also managed to cut down the time for preparing payments reports from half a day to half an hour.”
Trusted by Finance and Security Leaders
“Trustmi provided transparency into our payment process to see where cyberattacks and errors were happening and full protection without changing our workflow."
“Like many businesses today, we’ve experienced cyber attacks on our payment process, but we didn’t realize the extent to which we were at risk until we evaluated Trustmi. Now we’re confident we’ll be able to avoid future attacks with their platform.”
“Trustmi’s platform is an important tool for our team. Their Payment Flows module increases our payment cycle security, and our team has also managed to cut down the time for preparing payments reports from half a day to half an hour.”
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