Electronic theft surpasses physical theft for the first time

By on October 19, 2010, 4:31 PM
For the first time ever, more companies are suffering from electronic theft than from physical theft, according to the "Annual Global Fraud Report" (PDF) by risk consultancy Kroll (via CNET). The theft of information or electronic assets was reported by 27.3 percent of companies over the past 12 months, up from 18 percent in 2009. The theft of physical assets inched down to 27.2 percent from 28 percent last year. Kroll put together the report after hiring research group Economist Intelligence Unit to poll 801 senior corporate executives across the world about fraud and its effects on their businesses.

The study also found that fraud is typically an inside job. Quickly changing technology is the biggest challenge in combating electronic theft: 28 percent of the companies polled said this is the number one factor that raises their vulnerability to fraud. Unfortunately, only 48 percent said they plan to spend more money on IT security over the next year, down from 51 percent last year. The amount of money lost by businesses to all kinds of fraud rose over the past 12 months by more than 20 percent: from $1.4 million per billion dollars of sales to $1.7 million.

"Theft of confidential information is on the rise because data is increasingly portable, and perpetrators--often departing or disgruntled employees--can remove it with ease absent sufficient controls," Robert Brenner, vice president of Kroll's Americas region, said in a statement. "At the same time, there is a growing awareness among thieves of the increasing intrinsic value of an organization's intellectual property. The results of the survey do not suggest other types of fraud are decreasing but merely that the rise in theft of intellectual capital has outstripped other fraudulent activity that has remained constant."


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