Cybercrimes cost firms $600 billion last year: McAfee report

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In the last three years, costs incurred by businesses across the world due to cybercrimes have gone up from $445 billion in 2014 to $600 billion by the end of 2017. This cost, which was around 0.7% of global GDP in 2014, is now around 0.8% of global GDP, said a report released on Thursday by McAfee, a cyber-security company, in partnership with the Center for Strategic and International Studies (CSIS).

Highlights

  • Quick adoption of new technologies by cybercriminals, increased number of new users online (usually from low-income countries with weak cyber security), increased ease of committing cybercrimes, growing financial sophistication of top-tier cybercriminals and expanding number of cybercrime centres have been identified as reasons for growth in costs of cybercrimes by the report.
  • The report titled Economic Impact of Cybercrime—No Slowing Down identifies India as one of the emerging cybercrime centres along with other countries like North Korea, Brazil and Vietnam.
  • “The $600 billion cybercrime figure reflects the extent to which our technological accomplishments have transformed the criminal economy as dramatically as they have every other portion of our economy,” said Steve Grobman, chief technology officer at McAfee.
  • According to the report, ransomware is the fastest growing cybercrime. “Until 2015, ransomware campaigns were typically run by organized crime groups that wrote their own code. From 2012 to 2015, 33 new ransomware offerings were released, but that number doubled in 2016, with 70 new families of ransomware products made available,” it said.
  • However, the most important area in terms of the cost of cybercrime is the theft of intellectual property and confidential business information.
  • “The theft of intellectual property accounts for at least a quarter of the cost of cybercrime and, when it involves military technology, creates risks to national security as well,” the report stated.
  • The report also highlights that banks remain the favourite target of skilled cybercriminals.
  • The report also suggests some steps to reduce the cost of cybercrime such as greater standardization (threat data) and coordination of cybersecurity, particularly in key sectors like finance, uniform implementation of basic security measures (like regular updating and patching and open security architectures) and investment in defensive technologies.
  • However, it also states that the data on cybercrime remains poor because of underreporting and a surprising laxness in most government efforts around the world to collect data on cybercrime.

Cybercrime

Cybercrime is defined as a crime in which a computer is the object of the crime (hacking, phishing, spamming) or is used as a tool to commit an offense (child pornography, hate crimes). Cybercriminals may use computer technology to access personal information, business trade secrets or use the internet for exploitive or malicious purposes. Criminals can also use computers for communication and document or data storage. Criminals who perform these illegal activities are often referred to as hackers.

 DIFFERENT TYPES OF CYBER CRIMES

Cyber Crimes can be categorized in two ways

  1. The crimes in which the computer is the target. Examples of such crimes are hacking, virus attacks, DOS attack etc.
  2. The crime sin which the computer is used as a weapon. These types of crimes include cyber terrorism, IPR violations, credit card frauds, EFT frauds, pornography etc.

Cybercrime in India

  • With the centre scrambling to fortify India’s cyber operations amid growing warnings of malware attacks on personal and organizational devices, intelligence and cyber law experts have stated that much like crimes against women, India suffers from dismal under-reporting of cybercrime cases.
  • While the National Crime Records Bureau (NCRB) stated that India recorded 9,622, 11,592 and 12,317 cases of cybercrime in 2014, 2015 and 2016 respectively, experts stated that this data accounted for merely 1% of the cybercrimes that actually took place in the country.
  • These figures do not represent the ground reality. There is massive under-reporting of cybercrime cases in India and at present these numbers represent just 1% of actual incidents,
  • He said that people seldom come forward to report cybercrimes because of loopholes in the legal system.
  • While the home ministry has said that India is currently working towards bilateral cooperation with around 15 countries for exchange of information on cybercrimes, it has already taken several measures—legal, policy and institutional—to check cybercrime.
  • The government constituted an expert group to study the gaps and challenges in handling cybercrimes and prepare a road map for effectively tackling cybercrimes. Based on the group’s recommendations, the Cyber Crime against Women and Children (CCPWC) scheme has been approved by the government.

Q.1 Which of the following reasons are correct for sudden increase in cybercrimes?

  1. Due to growing adoption of the Internet and smart-phones, India has emerged “as one of the favorite countries among cyber criminals.”
  2. A new breed of cyber criminals has now emerged, whose main aim is not just financial gains but also causing disruption and chaos to businesses in particular and the nation at large.

Choose the correct answer from the above

  1. 1 only
  2. 2 only
  3. Both 1 ad 2
  4. Neither 1 nor 2

Answer:

c. both 1 and 2

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