Security breaches cost $1 trillion last year

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The global economic turmoil is putting vital information at greater risk than ever before, according to the findings of a new study published today.

Nearly two out of five (39 per cent) surveyed for the McAfee study, 'Unsecured Economies: Protecting Vital Information', believed sensitive data and intellectual property (IP) is more vulnerable in the current economic climate than before.

Researchers from Purdue University’s Centre for Education and Research in Information Assurance and Security examined responses from more than 800 chief information officers (CIOs) around the world, with the results released today at the World Economic Forum in Davos.

The researchers found that the heightened awareness of IP and data security had come at a cost. The average company had $12 million (£8.5 million) worth of sensitive information residing abroad, while respondents reported average IP losses worth $4.6 million (£3.25 million) in 2008.

Greg Day, security analyst at McAfee, said: “Most analyst research puts information security in the top three of most companies’ agendas for this coming year... They are realising the importance of security to information economies.”

McAfee projected that companies worldwide lost more than $1 trillion (£708 billion) last year, based on the total combined IP losses in 2008 and an additional $600 million (£454.5 million) the study found had been spent repairing data breach damage.

The UK reported some of the lowest losses of $375,000 (£265,336) and lowest levels of investment, “but then it is a mature country when it comes to information economies,” added Day.

Overall, the study found developing countries were more motivated to invest in protecting their IP than their Western counterparts. But then these countries were also the ones that reported the highest instance of data breaches, as China came out top with losses of $7.2 million (£5.1 million).

So much so, 26 per cent of respondents purposely avoided storing their IP in China.

“On one hand it’s a matter of the perception of which countries have more cybercrime than others, but on the other it’s about the how well they deal with security incidents and balancing the risks between the two,” Day said.

Another key finding was that 42 per cent said laid-off employees were the biggest security threat caused by the economic downturn, followed by external data thrives at 39 per cent. The rest were also worried that existing staff would view corporate data theft as a lucrative enough risk to take in tough times.

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