News Column

Cybercrime is a Booming Industry

June 9, 2014

Bloomberg News

Cybercrime is estimated to cost U.S. businesses as much as $445 billion a year. (file photo)
Cybercrime is estimated to cost U.S. businesses as much as $445 billion a year. (file photo)

Cybercrime remains a growth industry. That's the main message from former United States intelligence officials, who in a report on Monday outlined scenarios for how $445 billion a year in trade theft due to computer hackers will worsen. They warned that financial companies, retailers and energy companies are at risk from thieves who are becoming more sophisticated at pilfering data from their servers.

The outlook "is increased losses and slower growth," with no "credible scenario in which cybercrime losses diminish," according to the report published by the Washington-based Center for Strategic and International Studies (CSIS). Some of the damage will be hard to trace, such as economic downturns caused by foreign competitors selling products based on stolen designs and financial markets undermined by hackers.

"Cybercrime is here to stay," said Stewart Baker, a lead author of the study who was general counsel for the National Security Agency in the 1990s and later an assistant secretary at the Department of Homeland Security.

"The real question is do we know what cybercrime is costing us?" he asked in a telephone interview.

The damage done already includes 40 million people in the US having their personal information stolen within the last year and an unnamed oil company losing hundreds of millions of dollars in business opportunities when hackers obtained its oilfield exploration data, according to the report. Network security company McAfee sponsored the report for CSIS, a non-profit Washington-based policy research organisation.

Stolen secrets
The report is intended to provide a comprehensive estimate of the cost of global hacker attacks as governments and companies fight digital incursions that could have catastrophic consequences. US prosecutors in an indictment last month accused five Chinese military hackers of stealing information from American companies that would be useful to competitors in China.

The biggest driver in the cost is stolen intellectual property, said Tom Gann, vice- president of government relations for McAfee, a unit of Santa Clara, California-based chipmaker Intel.

Trade secrets are stolen online by foreign governments, criminal organisations and company competitors who hire their own hackers, Gann said in a phone interview. The attacks are enabled by the growth of a sophisticated underground economy where hackers and exploitation tools can be bought using digital currencies like bitcoin.

Companies sometimes don't know their plans have been stolen.

"The man whose bicycle is stolen knows exactly what he has lost the next morning," the authors wrote. Hackers could break into company networks or the computers of their lawyers and accountants to steal information about pending corporate acquisitions and business strategies, the report finds.


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Source: (c) 2014 Muscat Press and Publishing House SAOC Provided by SyndiGate Media Inc. (Syndigate.info).


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