High Unemployment Increases Cybercrime

In the past, a significant percentage of data breach incidents have been attributed to carelessness. The lost laptop is one of the most common data breach causes, especially given how few use encryption technology and how common it is for employees to have access to private data.

With the economic meltdown of 2009, and the subsequently high unemployment rates, there is now emerging a growing trend of data breaches caused by disaffected or displaced employees.

Recently noted by San Francisco Chronicle writer Alejandro Martínez-Cabrera in his article titled "How some ex-employees turn to cybercrime":

"Corporations across all industries have been dealing with a steadily growing number of internal data breaches since the financial meltdown. A Verizon data loss report noted that individuals with insider knowledge of organizations accounted for 20 percent of all breaches last year, and that number has been increasing as economic malaises drag on, said Chris Novak, managing principal of Verizon Business' Global Investigative Response Team."

"Stolen data can range from employees' health care records or clients' credit card numbers to merger and acquisition plans, confidential agreements or valuable source code, said Rick Kam, president and co-founder of data breach prevention firm ID Experts.

Thieves can easily sell the information to cyber-criminal rings or use it as a bargaining chip to get a job with their former employer's competitors. According to the Ponemon Institute study, 67 percent of respondents said they would use "their former company's confidential, sensitive or proprietary information to leverage a new job."

'The issue of identity theft is all about opportunity,' Kam said. 'And our first instinct is to protect ourselves.'

In one case handled by Kam's company six months ago, a disgruntled man went as far as trying to extort his former employer, a large health care provider, by threatening to release thousands of sensitive patient records that would have triggered an avalanche of lawsuits."