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by IDG News Service (San Francisco Bureau)

With Economic Slump, Concerns Rise Over Data Theft

Jan 29, 20094 mins
CybercrimeIdentity Management SolutionsPrivacy

Is the worsening economic situation going to turn some employees into data thieves?

Is the worsening economic situation going to turn some employees into data thieves?

That’s a top concern amongst IT decision makers, many of whom say that laid-off employees are the biggest security threat created by the economic downturn. In a McAfee-sponsored worldwide survey (registration required) of 1,000 IT decision makers, the company found that 42 percent of respondents felt that the laid-off employees represented the biggest IT security threat caused by the recession. That’s more than were worried about outside intruders. And 36 percent said that they were worried about security problems caused by employees in financial stress.

Crime rates spike during hard times, and with thousands of workers being laid off each week now, there may be an added incentive for employees shown the door to take intellectual property with them to bolster their chances of getting hired with a competitor, to use with a start-up company of their own, or maybe even to sell.

“The economic downturn across the board is going to provide additional motivation for people who would want to do harm,” said Seth Bromberger, an information security manager with PG&E in San Francisco. “It’s on a lot of people’s radar right now.”

According to Bromberger, companies that have their employee exit processes in order have less to fear from laid-off workers. It’s just that with the current economic squeeze, people’s motivation may be changing.

Layoffs can fray employee loyalty, and there certainly is money to be made selling all kinds of corporate data.

Last August, a financial analyst with subprime mortgage broker Countrywide named Rene Rebollo was arrested by the U.S. Federal Bureau of investigation for allegedly selling Excel spreadsheets containing customer information for about two-and-a-half cents per record. Over a two-year period he may have made US$70,000 from the scam, the FBI said.His annual salary was $65,000.

According to court filings, Countrywide had security software that disabled the use of USB drives on its PCs. But Rebollo found one PC that didn’t have the software and was able to download about 20,000 records each week onto his personal thumb drive, which he’d later email to a buyer, the FBI said.

USB drives are one of the most underestimated sources of data leaks, says McAfee CEO Dave DeWalt. “For $100 you can buy a 100GB drive,” he said. “100GB can be the entire customer base for an entire large company.”

An economic slowdown can create other computer security problems too. As businesses fail and are bought, that churn can lead to management chaos within IT groups. Workers aren’t sure how to report security concerns, or to whom, and existing controls may not be monitored as roles are switched and jobs are lost. In addition, workers may not want to report security issues for fear of jeopardizing a co-worker’s job or drawing unwanted attention to themselves.

Ignoring security problems can be costly. The average security breach results in a loss of $4.6 million in intellectual property and costs about $600,000 to clean up, DeWalt said.

“We don’t have the good risk models and as a result people are taking risks,” said Eugene Spafford, a professor of computer science with Purdue University who contributed to McAfee’s report on its survey data.

Security breaches will go up as a result of the downturn, especially as companies try to trim information security costs, although “it’s not clear that we will see a lot of them attributed back directly to security issues,” he said.

Still, not everyone sees the downturn as a game-changer.

“I’m not sure I recognize a greater threat to this company because of the downturn in terms of cyber threats,” said Jim Klotz, CIO with the PMA Insurance Group in Blue Bell, Pennsylvania. Increasing cyber crime is just a fact of life, and it would be growing with or without the slump, he said. “More people are capable and more people are finding profit in it.”