Cyber crime costsing world economy £266bn, warns McAfee

Cyber crime key on keyboard

Security firm McAfee has warned enterprises about the rising cost of cybercrime, putting worldwide losses at a staggering £266bn ($455bn).

This equates to around 350,000 lost jobs in Europe and the US, according to a study compiled by McAfee and the Center for Strategic and International Studies (CSIS).

“Cybercrime is a tax on innovation and slows the pace of global innovation by reducing the rate of return to innovators and investors,” said Jim Lewis, a director at CSIS.

“For developed countries, cybercrime has serious implications for employment. The effect of cybercrime is to shift employment away from jobs that create the most value. Even small changes in GDP can affect employment (PDF).”

The study found an increase in assaults on intellectual property, and McAfee called it “particularly damaging”.

In the UK, it is retailers that suffer the most, with losses due to hacking amounting to £850m, CSIS found.

Personal breaches are also on the rise, with McAfee estimating that 15 percent of US citizens have been victims of hacking. Globally “personal information” breaches could cost as much as $160bn and affect 800 million people, it said.

The UK ranks fifth in a table of most affected countries, and losses are estimated at $11.4bn, or around half a percent of gross national product.

“It is clear that cybercrime has a real and detrimental impact on the global economy. Over time, cybercrime has become a growth industry; the returns are great, and the risks are low,” said Raj Samani, EMEA CTO at McAfee.

“However, this situation is not irreparable as stronger technology defences, greater collaboration between nations, and improved public private partnerships could prevent and reduce the loss from cybercrime.”

Recovery costs are an increasing problem too, according to the report, which found that in Italy, the $8.5bn cost of cybercrime dwarfed the actual value of the losses directly caused by hacking, which stood at $875m.

Mark Sparshott, EMEA director at Proofpoint, said that it was hard to deny the impact of criminals, and added that everyone can learn lessons from this latest research.

“This report does a great job of describing the $445bn economic impact of cybercrime on our global economy,” he said.

“To put that into context, if cybercrime were a country it would have the 27th largest economy on the planet. Therefore this report should help everyone better visualise the scale of the threat we all face today.”

The warnings come after a spate of cyber attacks and database breaches that affected eBay, Spotify and Office, as efforts to tackle cyber criminals step up a notch, after the brief takedown of the Gameover Zeus malware botnet.

9 June 2014 | 1:55 pm – Source: v3.co.uk
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