Monday, March 28, 2011

Foreword by Simon Hunt,
VP and CTO, Endpoint Security, McAfee
Globalization and the commoditization of information technology have driven businesses to store increasing amounts of precious corporate data in the cloud. As this shift has taken place, cybercriminals have discovered new ways to target this precious data, both from inside and outside the organization.

In the past, cybercriminals targeted personal
information such as credit cards and social security
numbers, which were then sold on the black
market. Now, these criminals understand that
there is much greater value in selling a company’s
proprietary information to competitors and foreign
governments. For example, a company’s legal
documents can fetch far more money than a list
of customer credit cards.

The cyber underground economy has shifted
its focus to the theft of corporate intellectual
capital–the new currency of cybercrime.
Intellectual capital encompasses all the value
that a company derives from its intellectual
property including trade secrets, marketing plans,
research and development findings and even
source code. For example, Operation Aurora, a
targeted attack on Google and at least 30 other
companies, represented a sophisticated attack
designed to steal intellectual capital.

More recently, we discovered the ‘Night Dragon’
attacks on oil and gas companies around the
world, which over a period of several months
silently and insidiously exfiltrated gigabytes of
highly sensitive internal information including
proprietary information about field operations,
project financing and bidding documents. While
these attacks focused specifically on the energy
sector, the tools and techniques used can be
highly successful when targeting any industry.

Data protection solutions are now more critical than
ever as threats are coming from inside and outside
the business. WikiLeaks, for example, poses a new
threat to businesses, as insiders will be increasingly
tempted to release their company’s secrets for
financial or technological gain, to increase the level
of transparency of organizations, or to expose what
they believe is wrongdoing. The spate of recent
publicity around WikiLeaks has caused companies
to take a serious look at what is confidential, what
should be public and what should be protected.
With the perimeter continuing to dissolve due to
enterprises extending operations to mobile devices,
cloud computing, and to third party providers,
containing intrusion vectors is getting more and
more difficult. Once exploitation of the network
has been completed, the underground economy
is very good at exfiltrating and monetizing the data.

While IT security investments are rising to
prevent these intellectual capital thefts, so is the
sophistication of the attacks, requiring advanced
technologies and solutions to mitigate threats, in
addition to training and policies. Having policies
in place is important, but policies alone are not
solving the problem.

This report evaluates the global corporate state of
security, which is seemingly unprepared to protect
itself from the sophistication of attacks generated
by the underground economy. Have organizations
adjusted their policies and approaches accordingly?
The report concludes with approaches for
protecting intellectual capital in order to stem
losses and take full advantage of the coming
economic recovery.

Two years ago, McAfee produced the Unsecured Economies report, the first
global study on the security of information economies. That study found that
based on a global survey of businesses, companies worldwide lost more than
an estimated $1 trillion in 2008 due to data leaks, the cost of remediation
and reputational damage. Today, as the world economy begins to recover,
businesses around the world are taking a renewed look at their intellectual
capital, and how much is lost due to data loss and cyber attacks. Intellectual
capital encompasses all the value that a company derives from its intellectual
property including trade secrets, marketing plans, research and development
findings and source code.

The Internet has crushed geographical boundaries,
and companies have much of their value in
intangible information that is stored in the cloud.
As cybercriminals look for new information to steal,
they look at issues such as overseas storage, which
has made intellectual capital theft more prevalent
and prosecution much more difficult. Often,
companies are not even aware their information is
being stolen due to the sophistication of the types
of techniques used.

Although geography and culture can play a part,
particularly in countries where the lines between
business and government are blurred, it is the
value of the data that determines who and what
is attacked. The target and motivation are almost
always financial.

In 2011, many questions will be similar to those
asked two years ago, but the economic recovery,
as opposed to an economic downturn makes the
context different. How will an economic recovery
impact the ability of organizations to protect
vital information?

Which countries will pose the biggest threat
to economic stability in other countries? How
will cybercriminals target enterprises across all
geographies? How will the protection of digital
assets help or hinder a global economic recovery
in the coming year?

In collaboration with experts in the fields of data
protection and intellectual property, McAfee and
Science Applications International Corporation
(SAIC), a FORTUNE 500® scientific, engineering,
and technology applications company, took a
hard look at these questions.

Through a survey of more than 1,000 senior IT
decision makers in the U.S., U.K., Japan, China,
India, Brazil and the Middle East, McAfee together
with SAIC developed a study on this topic. The
survey, conducted by international research firm
Vanson Bourne, reveals the changes in attitudes
and perceptions of intellectual property protection
in the last two years.

“Anything that can be monetized can
become a target of the underground
economy. These range from banking
credentials of individuals to database
dumps of Fortune 100 companies.”
By Marcel van den Berg, Team Cymru

In some cases, governments are supporting the
theft of trade secrets, and in some countries
the lines between business and government are
blurred. If R&D costs are minimal or non-existent,
companies can bring products to market faster,
and make great profits off another company’s
investments. The theft of intellectual capital can
lead to death by a thousand cuts to a corporation,
and businesses worldwide should be concerned.

In 2009, German official Walter Opfermann,
an espionage protection expert in the office
for counter-intelligence for the state of Baden-
Württemberg, said that China was using an array
of “polished methods” from old-fashioned spies
to phone-tapping, and increasingly the Internet,
to steal industrial secrets1. The sectors most under
attack included car manufacturing, renewable
energies, chemistry, communication, optics, x-ray
technology, machinery, materials research and
armaments. Cybercriminals gather information
on research and development, management
techniques and marketing strategies.

In Italy in September 2010, former Ferrari
engineer Nigel Stepney was sentenced to
20 months in prison for his role in leaking of
confidential corporate data in 2007. Stepney was
found guilty of “sabotage, industrial espionage,
sporting fraud and attempted serious injury,” for
having passed Ferrari’s technical data to the rival
McLaren racing team.

Intellectual capital is increasingly vulnerable due
to the convergence of business and IT. Trade
secrets and proprietary data reside in databases
and are shared via email and the Internet. The
targets for the underground economy have
shifted significantly in the last couple of years.
While it remains a profitable enterprise to buy and
sell stolen credit cards, lately, intellectual capital has
become the new source of large and easy pay-outs.

Indeed, the vectors and targets of virtual attacks
on today’s networked information society
are multiplying. The High Technology Crimes
Committee of the Brazilian Bar Association –
São Paulo Chapter, summarizes: “We are seeing
groups who specialize in rendering networks,
services and basic infrastructure unavailable using
more sophisticated (DDoS) attacks, causing lost
revenue and damage to the image of major
corporations. On the other hand, there are groups
focused on surveying sensitive information and
industrial espionage. Government data leaks will
be a constant.”

Section 2: The Protection of Sensitive Data
There has been an evolution in the cyber underground, the type of data being
attacked has changed, and as the attacks have become more sophisticated,
the approach to data protection has changed as well. Not only do companies
have to worry about competitors stealing intellectual capital, but they have to
worry about sensitive or even classified information that could be leaked to
media, as in the case of WikiLeaks.

In July, 2010, Gordon M. Snow, Assistant Director
for the Federal Bureau of Investigation testified
before House Judiciary Subcommittee on Crime,
Terrorism, and Homeland Security:

“The impact of cyber crime on individuals
and commerce can be substantial, with the
consequences ranging from a mere inconvenience
to financial ruin. The potential for considerable
profits is enticing to young criminals, and has
resulted in the creation of a large underground
economy known as the cyber underground. The
cyber underground is a pervasive market governed
by rules and logic that closely mimic those of the
legitimate business world, including a unique
language, a set of expectations about its members’
conduct, and a system of stratification based on
knowledge and skill, activities, and reputation.”

The persistence and sophistication of the new
threats is significant, and the attacks are taking
place worldwide. In November 2010, Postmedia
News reported that 86 percent of large Canadian
corporations had been attacked, according to a
secret report by the Canadian government. The
report also said that espionage hacking of the
private sector has doubled in two years.

A March 2010 Forrester Research report found
that proprietary knowledge and company secrets
are twice as valuable as custodial data which refers
to payment card information, and customer and
medical data:

“Secrets comprise two-thirds of the value of firms’
information portfolios. Despite the increasing
mandates enterprises face, custodial data assets
aren’t the most valuable assets in enterprise
information portfolios. Proprietary knowledge and
company secrets, by contrast, are twice as valuable
as the custodial data. And as recent company
attacks illustrate, secrets are targets for theft."

Many organizations do not assess threats and
risks as often as they should. More than a
quarter of organizations assess the threats or
risks posed to their data twice a year or less
often. More than half of organizations determine
the frequency of these risk assessments on their
own, rather than on auditor recommendations
or regulatory requirements.

As The High Technology Crimes Committee of
the Brazilian Bar Association – São Paulo Chapter,
says: “The vast majority of companies from various
industries lack the control of their information
security policies and even groups from different
corporate areas take time to discuss these events.
In fact, policies are not audited often by their
managers which opens up numerous windows of
opportunity to carry out illegal actions. It seems as
if corporate actions are not punished. Companies
need to work on this image with ongoing training
aimed at protecting their intellectual capital.”

In China, Japan, United Kingdom and the United
States, organizations are on average spending
more than $1 million a day on their IT, and in
United States, China and India, organizations
are on average spending more than $1 million
a week on securing sensitive information abroad.
Approximately half of organizations surveyed
are looking to increase their IT security spending
on hardware upgrades, software upgrades and
external hosting of data and other services.
Around half of organizations anticipate that
their investment in securing sensitive information
will increase, with only one in twenty looking to
decrease their spending.

Despite growth of IT security spending, the
solutions are often reactive. When steps are
taken, organizations are most likely to install
new protection such as deep packet inspection,
as reported by more than two-thirds of respondents.
The most popular method of protecting sensitive
data is through the use of anti-virus software,
firewalls and intrusion detection/prevention (IDS/
IPS) systems, implemented by more than four in
five organizations.

Cloud based services may
represent a new target not only
for data theft, but also for cheap
infrastructure or resources within
criminal enterprises.

It is noteworthy, that almost half of respondents
reported that they would “take particular data
off the network” in order to protect it from being
leaked. Here the security of the data is considered
to be more important to the organization than the
availability or usage of the data.

Securing mobile devices continues to pose a
challenge to businesses with 62 percent of
respondents identifying this as challenge. The
greatest challenge organizations face when
managing information security is the changing
nature of attacks, followed very closely by the
proliferation of devices and services, such as
removable media, smart phones, and social
networking sites. Mobility continues to empower
and enable workforces to accomplish more
than ever, and this trend is only increasing.
Simultaneously, social media channels are of

growing interest for businesses to leverage. These
two forces represent an astronomical increase in the
level of risk organizations face with regard to leaked
data. This coupled with an organizations’ need
to share critical data with key partners means the
traditional approach to cyber security needs to be
augmented. “Smart phones will most likely cause
an increase in criminal research and development
efforts due to their ubiquity and functionality. Cloud
based services may also represent a new target not
only for data theft, but also for cheap infrastructure
or resources within criminal enterprises,” says Team
Cymru’s Marcel van den Berg.

Section 3: Cyber Threats and the Increasing Impact
on Business

Media coverage has increased concerns about the loss of confidential
information, especially by insiders. In 2008, three people were convicted for
stealing marketing plans from Coca-Cola4 and a year later, a former Goldman
Sachs computer programmer was arrested for stealing computer code used
to perform proprietary trading.

“A single mistake by an unaware employee can
have dire consequences,” said Dinesh Pillai, chief
executive officer, Mahindra Special Services Group,
a leading corporate security risk consulting firm
in India. “An employee socially engineered by
an attacker could result in critical data leakage,
financial and reputational losses or stall the business
functionality of the company. Most of the current
technologies use the preloaded algorithms to sense
any anomaly. However the underground world is
far superior in terms of their technology capability
and skills and they can identify ways and means
to break the systems.”

Additionally, according to The High Technology
Crimes Committee of the Brazilian Bar Association
– São Paulo Chapter, the insider threat is often
not just ‘accidental’: “Based on our assessment,
the biggest threat inside are the professionals
considered ‘Intruders’. These professionals work
in minor roles and carry out social engineering
and sensitive data appropriation techniques.

“A number of companies put their direct and
indirect employees under stricter scrutiny. In
many cases, there are professionals who suffer
pressure from criminal gangs in their underserved
communities. These gangs ask employees for
sensitive information, such as courier delivery
dates, electronic stations, supply schedules,
internal and external security passwords among
other corporate information, in exchange for the
safety of their families.”

As a result, just as in the previous study,
reputational impact worries organizations the
most. Around half of organizations reported that
as their number one concern regarding a data
breach involving sensitive information or intellectual
property. Today a public company can lose a topsecret
recipe, a go-to-market plan or other key
secret and they are reluctant to report it given the
potential backlash from customers, shareholders,
and the market. Media coverage after a breach can
affect brand reputation, and shareholder value and
therefore are underreported.

One in seven organizations has not reported data
breaches and/or losses to outside government
agencies or authorities, or stockholders. Only three
in ten organizations report all data breaches/losses
suffered, while one in ten organizations will only
report breaches/losses that they are legally obliged
to, and no more. Six in ten organizations currently
“pick and choose” the breaches/losses they report,
depending on how they feel about them.

The admission of a significant vulnerability could
flag other attackers so very few companies are
willing to be public about intellectual capital losses.

M&A activity, partnerships, product roll-outs are all
potential victims of cyber theft and the miscreants
of the underground economy. Around a quarter of
organizations have had a merger and acquisition
or a new product/solution rollout stopped or
slowed by a data breach, or the credible threat
of a data breach. Almost half of all organizations
have experienced a small data breach, and almost
a quarter of organizations have suffered a data
breach in the last year, more than in 2008.

Data breaches are also expensive. On average,
this lost/breached data costs organizations
more than $1.2 million, compared to less than
$700,000 in 2008.

Perhaps this is why only a quarter of organizations
conduct forensic analysis of a breach or loss, and
only half take steps to remediate and protect
systems for the future after a breach or attempted
breach. More than half of organizations have, at
some point in their history, decided not to further
pursue or investigate a security incident because
of the cost of such an investigation/pursuit.
Organizations are more likely to review/investigate
a small data breach internally, rather than bringing
in external help. This lack of investigation means
that potential vectors of attack are not shored
up and future penetration is possible or the
threat persists. Insiders are not identified, and
incongruities are not investigated to identify a
larger threat. This lack of remediation may open
up companies to the risks of future breaches.

The most significant threat reported by
organizations when protecting their sensitive
information was data leaked accidentally or
intentionally by employees. Employees’ adherence
(or lack thereof) to security procedures is considered
to be the greatest challenge to organizations’
information security. This ranked higher than other
challenges, including multiple systems within the
organization or the insecurity of supply chain
partner systems. Policies clearly have not stemmed
the data leak, forcing the hand of corporations to
choose robust and innovative technical solutions
to reinforce their guidelines.

Section 4: Solutions and Policies Go Hand-in-Hand

For many companies, security and risk managementdecisions are based on
strict adherence to compliance standards, not on protecting their intellectual
capital. These companies often do not make the connection that the impact
of a data breach can have a major impact on business and productivity,
slowing down product development and interfering with M&A activity.

Policies must work hand in hand with advanced
solutions in order to make a difference. They must
be implemented along with technology for deep
packet inspection, data loss prevention, advanced
threat monitoring, forensics and even taking
particular data off the network.

Furthermore, the distinction between insiders
and outsiders is blurring. “Sophisticated attackers
infiltrate a network, steal valid credentials on the
network, and operate freely – just as an insider
would. Having defensive strategies against
these blended insider threats is essential, and
organizations need insider threat tools that can
predict attacks from this blended threat,” said Scott
Aken, Vice President for Cyber Operations at SAIC.

Tom Kellermann, Vice President of Security
Awareness for Core Security Technologies,
cites the lack of robust penetration testing and
remediation timetables as a keyhole in many
companies’ cybersecurity strategies. Additionally,
weak authentication, porous wireless security and
insufficient wireless IDS technology contribute to
the problem.

Kellermann says that incident response and
forensics capabilities must be assessed regularly.
“Specifically, the Advanced Persistent Threat
illustrates the need for incident response to include
attack path mapping. Third party managed service
providers such as hosting companies and cloud
infrastructure providers must be contractually
bound to test their security posture and to adhere
to higher standards of cybersecurity before they
become “watering holes in East Africa” for
predators to infiltrate,” reports Kellermann.

“Most organizations are still looking at
cybersecurity as a perimeter-based problem. With
the perimeter continuing to expand through mobile
devices and cloud computing, a cyber security
department’s job is getting tougher,” added Aken.

Some emerging trends that are changing the
ways companies are defying sophisticated
attacks and insider leaks are listed below:

Deep Packet Inspection (DPI) – A DPI solution
acts as a highly flexible complement to existing
security architecture, performing inline, full packet
(layers 2-7) analysis in near real-time of all packets
(i.e., without packet loss). The software applications
that lie on top of the hardware allow for any kind
of rules-based arrangement to strip data off packets
leaving a network as well as prevent any type of
exploit by stripping it from incoming traffic.

Human Behavior Based Network Security –
These are solutions that are a step ahead of the
hackers or insiders that detect intent through the
activities taken on the network. These solutions do
not use signatures, anomalies, or heuristics, but
human behaviors that are common to all deceptive
actions on a network which can be stopped prior to
having data leave a network.

Insider Threat Tools – Recent innovations
in insider threat technologies have created
tool suites that can be deployed on systems
to monitor hundreds to thousands of inside
users simultaneously, tracking their actions and
identifying traits inherent in those actions that
should be cause for alert. By profiling suspicious
activities at line speed, these solutions can interrupt
connections if data is inappropriately being
removed or other unusual and critical operations
are taking place.

Advanced Forensics – Every digital device,
every computer, every mobile phone tells a story
that is traceable through a trail of “digital DNA”
uncovered through sophisticated computer and
network analysis. Software tools and services help
discover and extract critical content, and identify
user behaviors and unique identifiers. Knowing
which gaps and vulnerabilities led to an attack is
the first step in preventing the next attack.

Advanced Malware Analysis – It is now possible
to discover zero-day malware that will use or is
using network exploits to attack a network. Once
discovered, and the malware can be captured for
analysis and response.


While cybersecurity holes cannot be eliminated
completely, organizations can greatly reduce the
risks associated with confidential data leaving
their organizations. Organizations are looking
for a way to monitor the movement of sensitive
information and stop the potential loss of data via
malicious intent or inadvertent release. This can all
be prevented.

Appliances can be installed on the network to
record and classify everything that goes over the
Internet, and there are devices that can mine stored
structured and unstructured data so organizations
can search and discover where sensitive data is
kept. While these devices are not new, they are
continually being upgraded and incorporating more
predictive capabilities based on human behavior.
Solutions such as deep packet inspection, human
behavioral analysis, and encryption are all solutions
that will grow in use and effectiveness in the years
to come.

Today, organizations are looking beyond “checkthe-
box” compliance, and looking to protect more
sensitive data – like design documents, schematics,
product launch plans, pharmaceutical formulas –
their intellectual capital. These types of documents
are much more complex than simple Social Security
numbers or credit card numbers, and require
advanced protection solutions.

Scott Aken believes that protection of the
enterprise starts with education and understanding
of what you are trying to protect.

“Most organizations spend enormous sums of
money protecting the less critical portions of their
network while the crown jewels, their intellectual
capital, remain wide open. The thorough analysis
of what lies on the network, combined with a solid
Defense in Depth strategy, all implemented by a
properly trained staff can do wonders for protecting
an organization’s data.”


Scott Aken, Vice President for Cyber Operations,
Jenifer George, Cyber Portfolio Manager, SAIC
Marcel van den Berg, Team Lead for Business
Intelligence, Team Cymru
Simon Hunt, vice president and Chief Technology
Officer, Endpoint Security, McAfee
Tom Kellermann, Vice President of Security
Awareness for Core Security Technologies
Dinesh Pillai, Chief Executive Officer, Mahindra
Special Services Group
Erasmo Ribeiro Guimarães Junior, Secretary
and Member of The High Technology Crimes
Committee at OAB-SP
Marco Aurélio Pinto Florêncio Filho, Vice Chairman
of The High Technology Crimes Committee at
Coriolano Aurélio de Almeida Camargo Santos,
Chairman of The High Technology Crimes

References: 1
germany-china-industrial-espionage 2
nigel-stepney-patteggia-1-anno-e-8-mesi/ 3
The_Value_of_Corporate_Secrets.pdf 4
room/usab5705.pdf 5
Committee at OAB-SP

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Publisher and/or Author and/or Managing Editor:__Andres Agostini ─ @Futuretronium at Twitter! Futuretronium Book at