The Fastest Way into Your Org: Orphan & Local Accounts

How Invisible Identities Create Major Security Risks, and How to Fix It

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Executive Summary

Verizon’s 2025 Data Breach Investigation Report (DBIR) highlighted that credential abuse remains the most common vector of initial access (initiating 22% of all breaches). In modern enterprises, orphaned and local accounts, collectively known as “invisible identities” within the broader realm of identity dark matter, represent some of the most insidious and overlooked entry points for attackers. This whitepaper explores why these accounts persist, quantifies the risk through industry data and Orchid Security’s own research, and explains how attackers leverage them for initial compromise, ransomware deployment, and disruptive lateral movement.

01 The Invisible Threat: Orphan & Local Accounts

Orphaned Accounts - User or service accounts left active after owners depart or change roles.

Local Accounts - Credentials stored directly on systems/applications, often unmanaged and unmonitored.

Why they persist:

Inconsistent offboarding
Legacy systems with siloed credential stores
Lack of continuous application inventory
Shadow IT proliferation

Real-world scale:

44% of organizations report more than 1,000 orphaned accounts; 64% in financial services, 79% in healthcare. (Varonis)
26% of all accounts may be stale (>90 days unused); in some orgs this number has reached 90%. (Varonis)
27% of cloud breaches in 2024 involved misuse of dormant credentials, including orphaned and local accounts. (Trustle)

02 Breach & Disruption: Why These Accounts Matter

Attackers prize orphan, local, and unmanaged accounts because they combine three dangerous traits: access, persistence, and invisibility.

Initial Breach Vector -
- Stolen or guessed credentials for orphan/local accounts often bypass MFA and modern IAM because they are disconnected from central controls.
- These accounts rarely trigger alerts since they are “expected” to exist but lack active owners or a managed audit trail to close them out.
Lateral Movement -
- Once inside, adversaries exploit local admin accounts to pivot laterally, escalating privileges across servers, endpoints, and SaaS.
- Credential dumping techniques (e.g., Mimikatz, LSASS scraping) are particularly effective against unmanaged accounts with static or reused passwords.
Ransomware & Wipers -
- Stolen orphan/local credentials enable attackers to quietly spread ransomware payloads or destructive wipers without tripping anomaly-based defenses.
- Because activity is tied to a legitimate (but unmanaged) account, forensic attribution is delayed, buying attackers more time to encrypt or wipe systems.

Untraceable accounts (orphaned, local, unmanaged) multiply this risk by providing a pool of identities no one is watching.

03 Orchid Security’s Insights

Orchid Security State of Identity Security 2025 research confirms the prevalence of invisible identity risks:

In nearly half of enterprise environments, at least one application authentication flow bypasses standard identity providers, with credentials stored in plain text or hardcoded in scripts.
Basic identity controls, such as login rate limits, password complexity, and lockout policies, were missing up to 40% of the time.

04 Why Managed Identity Data Isn’t Enough

Insights drawn only from managed identity and access management (IAM) systems give a false sense of control -

Privileged account lists are incomplete - Because IAM tools only report on accounts they manage, any privileges granted outside that scope, such as by a direct database or local admin rights, remain hidden.
Local accounts remain invisible - Because they sit outside directory-based governance, accounts built directly into an application are not tracked or logged, leaving security teams blind to their use.
Orphaned accounts stay undetected - Because once a user leaves or changes roles, those accounts are often not tied back to HR or identity lifecycle processes, so they remain active without an owner.

This incomplete view makes organizations believe they’re secure, while attackers leverage hidden accounts as stealthy backdoors.

05 Best Practices to Illuminate Invisible Identities

To bring invisible identities into view, organizations need more than ad-hoc cleanups following cyber security incidents (or near incidents); they require a structured, continuous approach that combines discovery, monitoring, and remediation across all applications (managed and unmanaged). The following best practices outline how enterprises can systematically shed light on these risks and transform hidden exposures into managed, auditable controls.

✔ Comprehensive Discovery - Extend identity audit trail to unmanaged, legacy, and shadow IT systems to ensure no hidden exposures.
✔ Automated Orphan Detection - Link accounts to HR/IAM systems; deactivate unowned identities.
✔ Credential Hygiene - Eliminate static/local passwords; enforce rotation and strong policies.
✔ Toxic Combination Analysis - Detect privilege overlaps and excessive entitlements.
✔ Continuous Monitoring: Feed findings into SIEM/SOAR to detect unusual activity tied to dormant accounts.

06 Business Benefits of Addressing Orphan / Local Accounts

Minimizes breach vectors - Removes “low-hanging fruit” accounts attackers target first.
Disrupts ransomware playbooks - Cuts off stealth lateral movement paths.
Improves compliance - Addresses audit gaps in identity coverage.
Saves resources - Reduces wasted licenses and incident response costs.

Conclusion

Orphaned and local accounts are key elements within the dark matter of identity security, unseen, unmanaged, and highly exploitable. For attackers, they are the fastest way into your org. For defenders, they are the riskiest blind spot.

Understanding, let alone maintaining, identity security posture across any large organization- with its diverse and always evolving application estate- is a constant challenge.

Remember, that estate includes applications created by different developers, at different times- when technology, regulations and cyber risk were different- and even by different organizations if acquisitions were part of the growth strategy.

Any approach, but especially an automated one, that provides a comprehensive and accurate view into the true state of identity, is hugely valuable to CISOs. Especially when it can surface all of the identity flows coded in each application. We know that many threat actors are adept at finding the alternate or forgotten ways into our organizations, and this report highlights the most common exposures we need to look out for (and address).

The insights shared here are instructive for every cyber security professional.