CSI/FBI: Violations, Losses Down

If you think your company has actually experienced fewer security violations in the last year than it did the year before, and lost less money as a result, you're not crazy. In fact, according to a new report that will be issued tomorrow by the FBI and the Computer Security Institute, you may even be normal.

In their 11th annual poll of large enterprises, the CSI and the FBI report that 52 percent of organizations experienced unauthorized use of their computer systems in the last 12 month, down from 56 percent last year and 53 percent the year before. The percentage of respondents who say that there was no unauthorized use of their organization's computer systems increased from 31 percent last year to an all-time high of 38 percent this year.

The percentage of companies reporting six or more violations was also down to its lowest level in the survey's history with about 24 percent.

It's not all good news, however. Some categories of violations showed an increase in costs. Losses from laptop or mobile hardware theft, for example, grew from $19,562 per respondent in 2005 to $30,057 in 2006. Losses from telecommunication fraud rose from $2,750 last year to $12,377 this year. And the cost of Website defacement grew from $1,494 to $1,806.

Overall, though, the cost of security violations dropped in the past year, as it did the year before, according to the survey. "Taking the last two years together, there was a decline in average losses of $358,297, a two-year decline of over 68 percent," the report states. The CSI and the FBI attribute the decrease to the decline in reported incidents as well as dramatic increases in security investment by small and medium-sized firms.

In several cases, losses per incident also decreased in the last year, according to the survey. The cost of unauthorized access to information dropped from $303,234 in 2005 to $85,261 in 2006. The cost of viruses dropped from $179,781 to $69,125. And the costs of denial-of-service attacks dropped from $56,672 to $20,872.

Despite the relative dropoff in the frequency and costs of security incidents, enterprises continue to report ongoing threats. The majority of companies reported at least one security violation in the last 12 months. Most of the data losses come from outside the organization: Only 29 percent of respondents said that insider attacks accounted for more than 40 percent of their losses. Virus attacks and unauthorized access of systems are the two greatest sources of financial loss, according to the report.

What are IT departments doing about the violations? Some 98 percent have deployed firewalls, and 97 percent are using antivirus software. Seventy-nine percent have installed anti-spyware software, and 69 percent are using intrusion detection systems. Sixty-three percent are encrypting data in transit.

However, there are some "hot technologies" that still have not been deployed by a majority of enterprises. End-point security software, for example, has been deployed in only 31 percent of enterprises. Only 32 percent of respondents have installed wireless security products, and only 39 percent are using application firewalls. Sixty-one percent of respondents said they do no outsourcing of the security function.

What's at the top of the priority list? Seventy-three percent of respondents cited "data protection" as one of the most critical issues for the next two years. Sixty-three percent cited policy and regulatory compliance (such as SOX and HIPAA); 58 percent put identity theft and leakage of private information at the top of their lists (respondents were allowed more than one answer). Interestingly, fewer than 10 percent cited Web attacks, physical security, or end-point security as a top priority.

Despite the relative decline in incidence and losses due to security violations, the CSI and the FBI don't expect those losses to be eliminated anytime soon. "Regardless of measures an organization may take to protect its systems using technical computer security measures such as the use of passwords, biometrics, antivirus software and the like, there will be risks of financial loss that still remain," the report states.

— Tim Wilson, Site Editor, Dark Reading