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The Growing Costs of Cybercrime

In September of 2017, one of the three major credit reporting bureaus admitted to a massive data breach. Social security numbers, birth dates and home addresses for up to 143 million Americans were accessed by hackers. Such a breach exposed a record number of Americans to possible identity theft, and for the first time, many people directly felt the impact of cybercrime. Given that Equifax's data stores were of the most sensitive nature, it remains to be seen just how much damage was done. With this data, hackers could potentially open new bank accounts and lines of credit, stealing billions and ruining the credit of consumers.

However, this was not the first time such sensitive data was accessed by criminals. Another of the credit reporting agencies, Experian, was hacked in 2015. At the time, 15 million Americans were affected by the breach, which made it seem like a large-scale attack. As the Equifax hack has shown, though, cybercrime is affecting more and more citizens, and the incidence of data breaches is on the rise.

Hackers vs. Security Professionals

Cybersecurity is a battle between hackers and information security professionals. Hackers find security gaps to exploit, and cybersecurity experts patch the holes. This back and forth is happening daily, and it shows no signs of slowing. Hiscox Insurance published a report in 2017 that surveyed 3,000 companies across three countries. Their findings were alarming.

According to Steve Langan, CEO of Hiscox, in 2016, "cybercrime cost the global economy over $450 billion, over 2 billion personal records were stolen and in the U.S. alone over 100 million Americans had their medical records stolen." Amid this rampant theft, companies are ill-prepared to counter the threat. In the same study, Hiscox found that 53 percent of those 3,000 companies were ill-prepared to face the growing cybersecurity threat. Further, only "30 percent were rated 'expert' in their overall cyber readiness."

And the trend shows no signs of slowing.

The Cost of Cybercrime

The individual numbers vary: the Wall Street Journal estimates that cybercrime costs the US $100 billion a year, while insurance company Lloyd's puts the global figure at $400 billion. No matter the specifics, all entities agree that the problem is significant and growing. Forbes reports that from "2013 to 2015 the cyber crime costs quadrupled, and it looks like there will be another quadrupling from 2015 to 2019." This puts the figure closer to $1 trillion in 2019. It's no wonder that the CEO of IBM has called cybercrime the "greatest threat to every profession, every industry, every company in the world." Given that data is vital to so many industries, and indeed, represents the currency of the 21st century, there is no sector untouched by this growing threat.

That the U.S. is at the top of the list of countries prepared for such attacks offers little solace. Cybercrime hits the U.S. the hardest: "larger U.S. firms were the most targeted with 72 percent being attacked" in 2016-17. So, although 49 percent of the companies rated 'expert' in dealing with cybercrime are located in the United States, they are also the most frequent targets of attacks.

Small- and Mid-Sized Businesses Not Spared

Further, small- and medium-sized businesses are not immune. According to Symantec, another cybersecurity firm, small- and medium-sized businesses have increasingly become the target of hackers. Whereas in 2011 small- and medium-sized businesses made up only 18 percent of total targets of cyberattacks, that percentage ballooned to 43 percent in just five years. With more and more businesses collecting and storing user data, cybersecurity experts are needed to protect that data.

Given the epic proportions of the problem, even governments are investing in cybersecurity for the future.

So, it seems that no place is safe from cybercrime. Government and industries large and small see the threat and are taking measures to stem the rising tide of cyberattacks. Global data collection continues unabated, and hackers are finding new ways to exploit data stores for personal gain. It is yet to be seen if the hackers or the cybersecurity professionals will prevail. 

Learn more about the UT Tyler online MBA program with a Concentration in Cyber Security.


Sources:

The Washington Post: Data of 143 Million Americans Exposed in Hack of Credit Reporting Agency Equifax

CNBC: Cybercrime Costs the Global Economy $450 billion: CEO

Small Business Trends: 43 Percent of Cyber Attacks Target Small Business

Forbes: IBM's CEO on Hackers: 'Cyber Crime Is the Greatest Threat to Every Company in the World'

The Hill: Dems, GOP Invest in Cybersecurity Ahead of New Elections

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