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Report finds cybercrime to be a growth industry

Report finds cybercrime to be a growth industryThe cost of cybercrime is rapidly on the rise, according to a report released on Tuesday.

The total cost of damages incurred from cyber incidents increased by 19 percent in the United States from 2014 to 2015, according to the study. That was the second greatest increase of any country in the world, continuing a trend that has seen costs for U.S. companies increase by 82 percent since the study's inception six years ago.

Russia experienced the largest annual increase, with costs that grew 29 percent between years.

However, in terms of real value, there was an enormous difference between the two countries. The average cost per incident for U.S. companies was $15.42 million, the highest of any country. Russia came in at the bottom, with an average cost per incident of $2.37 million.

The report, published by the Ponemon Institute and Hewlett-Packard, also looked at the most lucrative industries targeted by cybercriminals. Financial services topped the list, with global financial firms reporting average losses of $13.5 million per incident. Utilities and energy came in at a close second, with average losses of $12.8 million. Technology companies placed third at $8.09 million.

Of 252 organizations surveyed, researchers found 99 percent were aware of attempted or successful attacks against them involving viruses, worms or trojans. Additionally, 98 percent had experienced attacks involving malware; 62 percent had been targeted in phishing or social engineering scams; and 59 percent had dealt with malicious code or botnets.

More than one-third — 35 percent — had dealt with malicious insiders who initiated cyberattacks, at an average cost of $144,542 each.

"With cyber attacks growing in both frequency and severity, understanding the financial impact can help organizations determine the appropriate amount of investment and resources needed to prevent or mitigate the consequences of an attack," said Dr. Larry Ponemon, the president of his eponymous institute.

To that end, the study found security intelligence systems and in-house staff were two of the most effective damage mitigants. Companies with such systems saw average savings of $1.9 million each, while those with expert staff or a cybersecurity leader like a CIO saw an average of $1.3 to $1.5 million less in costs.

As the cost of cybercrime increases, so do profits for technology insurers and cybersecurity experts. Research released by PricewaterhouseCoopers last month projected that cybersecurity insurance premiums in the U.S. would increase to $7.5 in 2019 from $2.5 billion in 2014, while information technology research firm Gartner suggested that total global cybersecurity spending would hit $75.4 billion for 2015.

Source: Washington Examiner
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