Cybercriminals Exploit Lookalike Domains as Digital Squatting Reaches Record Levels

NEW YORK, NY – Cybercriminals are increasingly turning to fake and lookalike website domains as a low-cost, high-impact way to target businesses and consumers. The practice, known as digital squatting, has accelerated sharply in recent years and is now viewed by cybersecurity experts as a growing threat rather than a minor nuisance.

According to data from the World Intellectual Property Organization, the number of domain-related disputes reached a record 6,200 cases in 2025. That figure represents a 68 percent increase compared with 2020, underscoring how rapidly the problem has expanded as more commerce and communication move online.

Digital squatting involves registering domain names that closely resemble legitimate brands, often with subtle differences that are easy to miss. Once active, these domains are commonly used to run phishing campaigns, distribute malware, or deceive customers into sending payments or personal information to criminals posing as trusted companies.

A Growing Risk for Businesses of All Sizes

While major global brands frequently make headlines for legal battles against domain squatters, smaller businesses are increasingly finding themselves targeted as well. Startups, professional service firms, and regional companies often lack the resources to monitor and secure large portfolios of domain names, making them attractive targets for impersonation schemes.

Cybersecurity researchers note that fake domains are being used in several common ways. Some criminals rely on typosquatting, registering common misspellings of well-known websites in hopes that users will mistype a web address. Others use combo-squatting, adding words like “login,” “support,” or “billing” to a legitimate brand name to create a sense of authenticity. In more advanced cases, attackers exploit different top-level domains or even visually similar characters from other alphabets to create nearly indistinguishable copies of real websites.

Once a victim lands on one of these sites, the consequences can be immediate. Login credentials may be harvested, malware silently installed, or payments redirected to fraudulent accounts. Even when customers avoid direct financial loss, trust in the legitimate business can be damaged.

Financial Stakes Continue to Rise

The broader financial impact of phishing and impersonation attacks tied to squatted domains has also grown. A 2025 report from IBM estimated that the average cost of a phishing-related breach now approaches $4.8 million, factoring in remediation expenses, lost business, regulatory penalties, and reputational harm.

For businesses, the domain name has effectively become the front door to their digital operations. When that door is copied or hijacked, the fallout can extend far beyond a single incident, affecting customer confidence and long-term brand value.

What Businesses Can Do to Reduce Exposure

Cybersecurity specialists generally agree that prevention is far more effective and less expensive than responding after damage has been done. Proactive domain management is increasingly viewed as a core part of brand protection.

This often includes registering a company’s name across multiple major domain extensions, securing common misspellings, and monitoring for newly registered domains that closely resemble an existing brand. Businesses operating internationally may also need to consider country-code domains in markets where they have customers or partners.

Education plays a role as well. Companies that clearly communicate their official web addresses and email practices help customers spot impostor sites more quickly, reducing the effectiveness of phishing campaigns.

An Issue Demanding Greater Attention

As digital squatting continues to rise, legal remedies alone are proving insufficient to stem the tide. Industry analysts warn that the speed and scale at which fraudulent domains can be registered means businesses must treat domain security as an ongoing responsibility rather than a one-time task.

Research published by web infrastructure firm Decodo highlights how impersonation tactics have evolved from isolated scams into organized, repeatable operations aimed at exploiting trust in familiar brand names. The findings reflect a broader shift in cybercrime toward methods that rely on deception rather than technical sophistication.

For Long Island businesses, the trend serves as a reminder that cybersecurity threats are not limited to data centers or internal networks. Something as simple as an unprotected or unmonitored domain name can open the door to fraud, customer harm, and lasting reputational damage.

As online activity continues to grow, experts say vigilance around domain ownership and monitoring will remain a critical part of protecting both businesses and consumers in an increasingly complex digital landscape.

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