McAfee: Annual Cost of Global Cybercrime Nears $600 Billion

Globally, cybercrime now costs businesses close to $600 billion annually, up from nearly $445 billion in 2014, according to a new report by McAfee in partnership with the Center for Strategic and International Studies (CSIS).

The report attributes the growth during three years to cybercriminals quickly adopting new technologies, the ease of engaging in cybercrime – including an expanding number of cybercrime centers – and the growing financial sophistication of top-tier cybercriminals.

McAfee’s Raj Samani

Raj Samani, chief scientist at McAfee, tells Channel Partners it’s important for the channel to note that the cost of cybercrime is not slowing down.

“This tells us that the channel has an incredible opportunity to engage with customers about their security infrastructure and to grow their cybersecurity offerings,” he said. “With this report, we’re seeing unprecedented growth in intellectual property (IP) theft, state-sponsored bank robbery, ransomware, cybercrime as a service, and increased reliance on anonymization services, all demonstrating the critical need for improved defensive security posture and engaged security response teams.”

For the channel, it emphasizes that this is a business issue, Samani said.

“It has long been held that this industry is an IT problem, but the figures revealed here show that IT risk is business risk and the cost of a breach will be felt by the business,” he said. “Articulating this to the senior leadership is imperative so that appropriate measures are taken.”

Banks remain the favorite targets of cybercriminals, and nation states are the most dangerous source of cybercrime, according to the report. Russia, North Korea and Iran are the most active in hacking financial institutions, while China is the most active in cyberespionage.

“The areas most remarkable to the channel are twofold,” Samani said. “First, the increased threat to financial institutions, despite their high spends on cybersecurity technology, is noteworthy. While this has been the norm for over a decade, channel partners working with financial organizations need to be aware that cybercrime imposes a heavy cost on financial institutions as they struggle to combat fraud and outright theft, and be aggressive in working with their financial customers to ensure their security defenses are optimized. Second, attacks aimed at intellectual-property theft account for the highest percentage of the global economic impact numbers, at 25 percent. While working with customers to set up new or update existing defenses, channel partners need to ensure that their customers are doing their due diligence in protecting their IP.”

Samani said he sees a lot of opportunity for the channel in “amplifying the need for greater standardization of threat data and better coordination of cybersecurity requirements to improve security.”

“Channel partners should encourage customers to integrate security best-practices into their technology environments, and to remain engaged in the security community’s discussion about the future of cyberthreats,” he said. “Partners should also make it a point to prioritize security at every level of the sales and technology deployment process, and to emphasize the need for …

… defensive technologies. Educating customers on their technology purchases and being knowledgeable about the threats targeting them is key to building a trusting partnership with security at the forefront, and to lessening the toll of any future cyberattacks.”

The report measures cybercrime in North America, Europe and Central Asia, East Asia and the Pacific, South Asia, Latin America and the Caribbean, Sub-Saharan Africa, and the Middle East and North Africa. Not surprisingly, cybercrime losses are greater in richer countries; however, the countries with the greatest losses (as a percentage of national income) are mid-tier nations that are digitized, but not yet fully capable in cybersecurity.

“Our research bore out the fact that Russia is the leader in cybercrime, reflecting the skill of its hacker community and its disdain for western law enforcement,” said James Lewis, senior vice president at CSIS. “North Korea is second in line, as the nation uses cryptocurrency theft to help fund its regime, and we’re now seeing an expanding number of cybercrime centers, including not only North Korea, but also Brazil, India and Vietnam.”