Tags: cyber | attack | terrorism | economy

Cyber Attacks Pose Biggest Unrecognized Threat to Economy

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Friday, 08 May 2015 07:33 AM Current | Bio | Archive

There is no shortage of threats to the U.S. economy: fragile growth, increasing regulation, the timing of the Fed’s raising interest rates, White House and congressional inaction, out-of-control entitlements, and a punitive and complicated tax system. Yet the biggest threat may be one that is least mentioned: cyber attacks.

Cyber attacks have been expanding quickly from criminal gain to corporate espionage to ideological warfare. And these attacks have been increasing in frequency, scale, sophistication and severity.

The primary reason for cyber attacks has been financial gain. Criminals go where the money is and there is easy money using personal data to commit fraud. Credit card data are sold to other criminals who use them to make purchases. Medical data are used to create new personal identities for credit card and bank fraud. Health insurance information is used to make false claims, access addictive prescription drugs and get free medical treatment.

As a result, stealing personal data has reached epidemic proportions. The numbers from recent data breaches are staggering: credit card information from 56 million Home Depot and 70 million Target customers, 145 million login credentials from eBay, contact information for 76 million J.P. Morgan Chase customers and 80 million Anthem customers. Even small companies are not immune to these cyber attacks. From card skimmers to point-of-sale intrusions, data theft rings have targeted relatively unprotected small businesses as a new and vast profit center.

The economic costs are monumental. It costs the breached organization an average of $200 per compromised record, mostly from business disruption and revenue loss. That does not include intangible costs like losing customer loyalty or hurting a company’s brand.

To add insult to injury, corporate espionage attacks are increasing. Stealing intellectual property and spying on competitors comprises a growing number of attacks and come at huge costs to the company that has been hacked. And the big difference with corporate spying is that the attacker usually does not give up until they are successful.

Finally, and most dangerous, are ideologically and politically motivated attacks. Cyber attacks have proven that computers are very vulnerable. But like any profit-driven enterprise, criminals and corporations are adverse to killing the goose that lays their golden eggs. Even nation states like China and Russia may be too co-dependent on the U.S.

But the growth of ideologically driven movements is changing the risk. It is not a huge leap of imagination to envision a radical environmental group hacking into our energy infrastructure. Or terrorist groups like ISIS, Boko Haram and al Qaeda wanting to bring down our banking system. Ideological or political enemies can exploit the same vulnerabilities but have no remorse about maiming or killing the goose.

In the recent annual threat assessment delivered to Congress, the National Director of Intelligence said that cyber attacks by politically and criminally motivated actors are the biggest threat to U.S. national security. In this brave new world, the good guys are playing catch up to the bad guys, who seem to always be one step ahead.

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Ed-Moy
Cyber attacks have been expanding quickly from criminal gain to corporate espionage to ideological warfare. And these attacks have been increasing in frequency, scale, sophistication and severity.
cyber, attack, terrorism, economy
501
2015-33-08
Friday, 08 May 2015 07:33 AM
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