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29 Jul 2015

Detecting And Preventing Corporate Espionage

Detecting And Preventing Corporate Espionage

Last week the U.S. government announced that it intends to increase its use of a law designed for catching terrorists and spies to fight what officials call a "surge in corporate espionage cases". As decisions in the US often find their way onto our shores, in this week’s blog; we look at this growing area of concern.


Corporate espionage is as old as business itself. However, as technology has developed, there has been an expansion of murky practices like phone bugging, computer hacking and secret filming.

In particular, targeted cyberattacks based on IP theft are being conducted against both the manufacturing industry and smaller businesses, which are less likely to invest in shoring up their defenses against attack. Research suggests that SMEs (Small & Medium-sized Enterprises) now account for 31 per cent of targeted attacks, and are often seen as a means to gain access to larger firms through "watering hole" techniques.

Despite the increased cyber threat, reports have shown that the majority of business espionage is committed by employees - with employees accounting for nine out of ten cases.


So, how do you detect that an employee may be passing information to a competitor?

The key in detecting a potential rogue employee is to recognise the warning signs. Management, legal, HR and other personnel should be trained to detect ‘red flags’. Unhappy employees are among the biggest risks. For example, employees who received layoff notices, were passed-over for promotion, refused exit interviews or are required to follow a PIP (performance improvement plan) may warrant closer observation.

The FBI’s “Insider Threat: An Introduction to Detecting and Deterring an Insider Spy” explains the key warning signs that you may have a mole are: when an employee without need, takes any form of material home. Or they show interest in matters outside the scope of their duties, particularly those of interest to business competitors. They may also work odd hours, without authorisation and exhibit unexplained affluence. If anyone in your business does any of the above, you may be dealing with a corporate espionage.

How do I protect myself?

Evidence shows that three quarters of business espionage occurs from obtaining a physical document or disk, rather than hacking. Often, a company’s secrecy is breached by competitors or employees rooting through bins, rather than cracking any passwords. Businesses should therefore re-evaluate their processes to ensure that these particular occurrences do not occur, and implement the following safeguards:

Shred Documents - Since the majority of information stolen is in the physical form, organisations should shred all important documents before they are discarded.

Avoid Printing Proprietary Information - Do not print sensitive company information unless it is absolutely necessary. Then immediately place the information in a secure place until it reaches the intended party.

Physical Security - Secure all necessary printed documents in a locked file cabinet and keep them locked when not in use.

Copy Proof Technology – Organisations should invest in technology that prevents documents with sensitive data from being copied. Common solutions might be a program like Adobe Acrobat, or Pagemaker.

Enterprise Rights Management – It is a good idea to set access controls within software ensuring only authorised parties can view or print specific documents. This will prevent individuals from carelessly printing materials which may expose the company to unnecessary risks.

Preventing Computer Espionage - Trojan Horses and viruses are often used to lift information from corporate individuals. Companies need firewalls and other ways to block company sensitive data from leaking from the corporation. All anti-virus and anti-Trojan software should be updated frequently.

Corporate espionage is a serious crime. A California chemical engineer was sentenced to 15 years in prison and fined $28 million (roughly £18 million) after his economic-espionage conviction for selling China the technology that creates a white pigment. By implementing the above safeguards, it should never get to this stage. 


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