From Trusted to Threat: The Hidden Risks of Verified Accounts

Why Continuous Monitoring Is Essential for Account Protection

Business leaders and fraud managers invest significant resources in verifying and authenticating new customers. You implement rigorous fraud checks, confirm identities, and follow best practices to ensure each account is secure at the point of creation. At that moment, you can be confident the account is trustworthy.

Compromised Email Risk: The Silent Trigger for Account Takeover

Here’s the hard truth: even if you’ve verified a customer at signup, their account can still be at risk the next day, all because of their email address.

When an email gets compromised through a phishing scam, a data breach, or dark web sale, fraudsters suddenly hold the keys to everything. With email inbox access, they can grab password reset links, approve fraudulent transactions, and impersonate your customer, all while flying under the radar.

Account Creation to ATO

From your perspective, a new customer has successfully passed fraud checks and started their journey with your brand. For fraudsters, however, this is just the beginning of an opportunity. Even if the onboarding data is clean, an email address, a seemingly mundane detail, can become the gateway to account takeover.

1. A user enters data to create a new account

2. Your company runs its process to authenticate and verify user data and approves the new account

3. The email address becomes compromised due to several causes like phishing, breach, etc.

4. Using the compromised email account, fraudsters now control the account and can:

   • Alter account details or reset passwords

   • Drain loyalty points, balances, or digital wallets

   • Make unauthorized purchases

   • Damage your brand’s reputation by making your business appear vulnerable

The Underlying Issue

Users/customers routinely reuse the same email and password combinations across numerous websites. On average, people maintain 75–100 online accounts. If their credentials are compromised elsewhere, that same combination can be used to breach their account on your platform.

When an email gets compromised through a phishing scam, a data breach, or dark web sale, fraudsters suddenly hold the keys to everything. With inbox access, they can grab password reset links, approve fraudulent transactions, and impersonate your customer—all while flying under the radar.

Why is this so dangerous?

• Email is the digital hub: It connects bank accounts, shopping platforms, social media, even work logins. If one email is compromised, dozens of accounts can be, too.

• Customers rarely know: Most people never realize their email has been exposed until after something bad happens.

• Credential reuse is rampant: People recycle the same email-and-password combo across sites, so a breach in one place can easily spill over to yours.

That’s why continuous email reputation checks matter, they help you spot when “trusted” accounts are no longer trustworthy, before takeover and fraud hit your bottom line.

A Proactive Approach

While robust account verification at signup is essential, it's not sufficient. Modern fraud management demands ongoing risk assessment at every key touchpoint, such as account creation, customer login, account changes, funds transfer, and loyalty points redemption.

The Power of Email Reputation

This is where myNetWatchman’s Email Reputation service adds critical value. Through a simple API, you can instantly verify at these key customer interactions, like:

• Account Creation: Assess whether the email is compromised, fake, or synthetic, for step-up authentication or to block suspicious applicants upfront.

• Customer Login: Detects if the account has been compromised and actively being used by bad actors since its creation.

• Account Changes: Ensure account details are not being changed by bad actors who have taken over the account.

• Funds Transfer, Loyalty Points Redemption: Before a transfer of value takes place, make sure the actual account owner is in control.

For your business, this translates to lower authentication costs, stronger defense against account takeover, and a smoother experience for legitimate customers.

Final Thought

The reality is that an account deemed “safe” yesterday may already be a risk today. By integrating continuous trust checks like Email Reputation into your fraud prevention strategy, you proactively close security gaps, protecting your business and maintaining customer confidence.