Data Theft Outpaces Physical Stealing

For the first time, companies are reporting more electronic data theft than
physical thefts, said London-based risk consultancy Kroll.

Kroll’s "Global Fraud
Report
," an annual report on international
fraud trends
released on Oct. 18, surveyed more than 800 senior executives
worldwide and across a range of industries in July and August. According to the study, electronic and information theft accounted for 27.3 percent of total
fraud losses, compared with 27.2 percent for physical theft of cash, assets and
inventory in 2010. Physical theft had been the most widespread form of fraud by
a considerable margin in previous Global Fraud Reports.

According to the report, fraudsters are not switching away from other forms
of fraud. Instead, information theft grew significantly to overtake physical
theft and other types of stealing. "Information-rich industries" were the most
vulnerable. According to the survey, the industry sectors with the highest levels of electronic theft are:

  • Financial services
  • Professional services
  • Technology companies
  • Media
  • Telecoms

Poorly defended systems are easy to exploit, whether it’s by sophisticated
hackers or disgruntled employees walking out with the company’s sensitive data
on a USB stick, the researchers said.

Businesses lost almost $1.7 million per billion dollars in sales worldwide
compared with the $1.4 million per billion dollars reported in 2009.

A company’s own employees are a threat, with fraud more often than not being an
"inside job," according to the survey results. Junior employees and
senior management were the most likely perpetrators of fraud. Staff or agents
were the most common perpetrators of fraud in every region except Latin
America, where customers were the principal fraudsters, said the
report.

For more, read the eWeek article Electronic Data Theft More Prevalent Than Physical Thefts: Survey.

CIO Insight Staff
CIO Insight Staff
CIO Insight offers thought leadership and best practices in the IT security and management industry while providing expert recommendations on software solutions for IT leaders. It is the trusted resource for security professionals who need network monitoring technology and solutions to maintain regulatory compliance for their teams and organizations.

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