Social Engineering Risks for MSPs: The Complete Guide

Social Engineering is one of the most prolific entry points for modern cyberattacks. Instead of exploiting technical vulnerabilities, threat actors take advantage of human behavioral quirks. Managed Service Providers (MSPs), who handle sensitive data daily, have a unique risk profile for social engineering attacks. Understanding social engineering, how it works, and why it's so successful is vital to mitigating risk.

What Is Social Engineering?

Social engineering is a group of confidence schemes that manipulate unsuspecting users into disclosing sensitive information or performing actions that could compromise systems. These schemes rely on psychological tactics like trust, authority, fear, or urgency to exploit human emotions and behaviors for the desired outcome.

These psychological tricks often prey on the human “fight or flight” mechanism. Humans innately react to external negative stimuli in one of two ways:

1. 1.Fight: The individual directly confronts the negative stimuli to eliminate it. In a corporate context, this might look like a “defy by default” mentality or following rules regarding passwords, links, and building entries.
2. 2.Flight: The individual escapes or passively addresses the negative stimuli to avoid dealing with it. In business, this may take the form of an “allow by default" mindset, where access is provided more flexibly to avoid stress.

Other types of social engineering take advantage of greed, kindness, laziness, or ignorance, though these are less common as they require more engagement from the attacker.

Attackers can carry out social engineering campaigns through various modes of communication, including:

• ​Phone calls
• ​Emails
• ​Texts
• ​In-person interactions
• ​Online advertisements

Social engineers aim to steal sensitive information, spread malware, or gain unauthorized access to systems to achieve control over organizational data, which they can use, ransom, or sell.

Types of Social Engineering Attacks

Social engineering attacks take many forms. Here are some prominent examples:

Phishing

Phishing is a form of online attack where a threat actor uses email to trick a user into completing an action that triggers the attack. These attacks can be:

• ​File-based attacks: The victim opens an attached file (e.g., spreadsheet or PDF) that downloads malware, providing the attacker access to the computer and network.
• ​Link-based attacks: The victim clicks a link to a spoofed website and enters credentials, giving the attacker access.
• ​Information redirection attacks: The attacker spoofs or gains access to an MSP's email and redirects sensitive data, invoices, and payments. Business Email Compromise (BEC) attacks are a common example.

Phishing is currently the most successful entry point for threat actors into corporate environments.

Vishing

Vishing is phishing via voice communications. Attackers use calls or voicemails to impersonate employees or steal credentials. Vishing can be used to impersonate a business and coax customers into redirecting payments. Unlike BEC, there is little recourse for removing phone numbers, and spoofing new numbers is easy for attackers.

Watering Hole

A watering hole attack involves compromising a website frequently used by the target with malware or infiltrating it to gather information. This can target organizations or their customers.

Baiting

Baiting attacks involve leaving a physical item, like a USB flash drive, in a public place to bait someone into using it. There are two forms:

• ​Targeting anyone: Devices are left in public for anyone to pick up. Plugging it in deploys malware.
• ​Targeting an organization: Devices are placed where organizational personnel are likely to find them, such as outside the office.

Many Endpoint Detection and Response (EDR) solutions now block USB storage to mitigate these attacks. However, sophisticated attacks like Stuxnet have used baiting to overcome air-gapping controls.

Dumpster Diving

Dumpster diving requires the attacker to be physically near the target’s location. It relies on employees not shredding critical information or disposing of hardware properly, allowing attackers to retrieve sensitive data from trash.

Quid Pro Quo

Quid pro quo attacks involve offering something in exchange for information or access. Examples include:

• ​Ransomware: Stealing or encrypting data and demanding payment for decryption.
• ​Blackmail: Threatening to disclose damaging information unless paid.
• ​Payment schemes: Sending gift cards to executives as a favor, then requesting payment as part of a larger scheme.

Quid pro quo attacks may be combined with other methods, such as phishing and ransomware.

Why MSPs Are Popular Targets

MSPs are targeted due to economies of scale. Attacking an MSP can provide access to many clients’ data or environments. Additionally, compromising MSPs can allow attackers to manipulate code bases for products used by thousands or millions of customers, yielding greater returns than attacking individual customers.

Mitigating these attacks is difficult because "you can’t patch people." However, providing tools, resources, and support can help staff address social engineering attacks and reject them intelligently.

How to Stop Social Engineering Attacks

Implementing an industry-specific training program is the most effective way to protect against social engineering. Components may include:

• ​Phishing training
• ​Security training
• ​Threat training
• ​Incident and disaster recovery tabletop exercises

Training staff to recognize threats increases vigilance and response effectiveness.

Teaching a Deny by Default Mindset

Empowering staff to “deny by default” is critical. Saying no in potentially threatening situations can prevent significant damage. However, being too restrictive can frustrate customers. Organizations must balance permissiveness and restrictiveness based on their environment and risk profile.

Staff need a clear, accessible path for escalating threats. Complicated reporting processes discourage reporting, reducing protection. Staff should not be reprimanded for reporting threats, as this can have a chilling effect and increase risk.

Final Thoughts

Social engineering attacks are dangerous because they target an organization's most vulnerable assets—its people. Malicious actors use manipulative tactics to gain access to environments and capture data or money. Many social engineering attacks are unpredictable and difficult to spot. MSPs must strengthen security defenses, and investing in training is an effective approach.

Mitigate Your Social Engineering Risk

Social engineering tactics rely on basic principles of human psychology, but employees can be trained to recognize these schemes. Effective security awareness training programs, especially those tailored for MSPs, can prepare staff to handle real-world attacks and strengthen security posture.