Beware of cyber crime: It’s growing rapidly and you are at risk!

“The infectiousness of crime is like that of the plague” (Napoleon Bonaparte) Isn’t it terrible how many dangers are lurking out there? One of them is cyber crime and small businesses (with less than 250 staff) are increasingly being targeted. South Africa is particularly vulnerable as we are naive when it comes to protecting our assets, know-how and trade secrets. What is cyber crime and how prevalent is it? It is using technology (Internet, computers, software and smartphones) to steal data, property, IDs, passwords or money. It also includes the destruction of data or software via viruses. Phishing, corporate espionage, and stealing from your bank account are examples. Cyber crime is illegal in South Africa and offenders contravening ECTA (the Electronic Communications and Transactions Act) are liable to up to five years imprisonment. It is difficult to get actual facts as crime statistics do not separately isolate cyber crime. Experts are also convinced it is widely under-reported.    A recent survey done in South Africa showed only 7% of businesses said their systems to prevent data leakage were working well. Police statistics show that white collar crime has risen 56% since 2006. South African banks reported that phishing increased by 61% in 2011. England, not surprisingly as a first world economy, has more experience with cyber crime. In 2011, GBP27 billion was lost to cyber crime, of which GBP21 billion (almost 80%) is attributable to small businesses. For an eye-opening look at the staggering levels of cybercrime globally (did you know for example that over 600,000 Facebook accounts are compromised daily?) see the Infographic at Why target small businesses?    Small businesses do not have the resources to actively combat cyber crime and thus are easier targets for perpetrators of cyber crime. They are vulnerable to phishing and bank fraud but, more significantly, they are also exposed to theft of intellectual property (IP) and industrial espionage. In the above UK research, of the GBP21 billion losses attributable to small business, most of the cyber crime came from theft of IP and corporate espionage. There is no doubt this is more prevalent locally. Apart from there being widespread ignorance, security experts are scarce and much of our IT security is outsourced to foreign companies. We have recently seen how the United States is eavesdropping around the globe and we need to ask just how secure are we? How much of our intellectual property and trade secrets end up in overseas companies and countries? What can we do about it?    As a starting point, we should review our controls and security. Staff should be aware of phishing and similar practices and should be warned to be careful about what information they share on social media sites.  Systems should be put in place to monitor and respond to such incidents. In terms of losing our IP and being vulnerable to espionage, this requires substantial resources and needs the involvement of government security agencies. The Electronic Communications and Transactions Act of 2002 provided for the appointment of “cyber inspectors” with police-like powers to monitor for, and investigate, cyber crime, yet this is still to happen. A grassroots advocacy campaign from business to get this cyber crime force off the ground is a significant option to look at, and the recent appointment by government of a “National Cyber Security Advisory Council (NCAC)” is a positive step in this regard. © DotNews, 2005-2013. This article is a general information sheet and should not be used or relied on as professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact your financial adviser for specific and detailed advice.

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