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Brian Pennington

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Enterprise Risk Management

The growing threat of insider fraud not a top security priority for organizations

ponemonAn Attachmate sponsored Ponemon Survey indicates the growing threat of insider fraud is not a top security priority for organizations which is proving to be a costly mistake.

On average, organisations experience approximately one fraud event per week, according to information from the second annual Attachmate and Ponemon Institute survey, “The Risk of Insider Fraud

However, only 44% of respondents say their organisation views insider fraud prevention as a top security priority, a perception which has declined since 2011.

The average cost of a data breach in a 2011 study was $194 per lost or stolen record

The survey reveals some alarming data security trends:

  • On average, it takes 87 days to first recognize that insider fraud has occurred and more than three months (105 days) to get at the root cause of the fraud.
  • 79% of respondents say that in their organization a privileged user has or is very likely to alter application controls to access or change sensitive information and then reset the controls.
  • 73% of respondents, an employee’s malfeasance has caused financial loss and possibly brand damage.
  • 81% say they already had an employee use someone else’s credentials to gain elevated rights or to bypass separation-of-duty control
  • 48% of respondents say that BYOD has resulted in a significant increase in fraud risk
  • 77% of respondents say the lack of security protocols over edge devices presents a significant security challenge and risk

This data demonstrates the invisibility of employee actions across an enterprise,” said Larry Ponemon, chairman and founder of Ponemon Institute. “While organizations may have policies and procedures to thwart insider fraud, it doesn’t mean employees will remain compliant, particularly with the rise of Bring Your Own Device (BYOD) practices

Data security and insider threats continue to be a challenge for organizations, particularly as BYOD brings complexity to enterprise risk management,” said Christine Meyers, director of Attachmate’s enterprise fraud management solutions. “Next-generation enterprise fraud management solutions, such as Attachmate Luminet, are able to correlate cross-channel activity, score risk and provide a screen-by-screen replay of what actually occurred. Add to that the proven deterrence factor that arises from being able to see and monitor use and abuse, and you can see why customers choose to deploy this technology for fraud detection

Fraud statistics

  • On average, organizations have had approximately 55 employee-related incidents of fraud in the past 12 months
  • More than one-third say that employees’ use of personally owned, mobile devices has resulted in malware and virus infections that infiltrated their corporate networks and enterprise systems and another 26% it is very likely to occur
  • 61% rate the threat of insider risk within their organization as very high or high
  • 23% say insider fraud incidents existed six months or longer before being discovered and 9% could not determine when they occurred.
  • 55% of organizations say their organization does not have the ability/intelligence to determine if the off site employee’s non-compliance is due to negligence or fraud

Threats from BYOD, Mobility & Edge Devices

For the first time the study asks questions about the effect Bring Your Own Device (BYOD), mobility and edge devices have on the risk of insider fraud. We define BYOD as the employees’ use of their personally owned mobile devices (typically smart phones, tablets and laptops) for both work and non-work activities.

An edge device is a physical device that can pass packets between a legacy network (like an Ethernet network) and an ATM network, using data link layer and network layer information. An edge device does not have responsibility for gathering network routing information. It simply uses the routing information it finds in the network layer using the route distribution protocol. An edge router is an example of an edge device.

Edge devices and BYOD make it difficult to identify insider fraud

58% agree that BYOD makes it more difficult for the security or compliance department to have complete visibility of employees’ access and computing activities. The majority of respondents (78%) do not agree that employees’ access and possible misuse of edge devices is completely visible to the security or compliance department (100% – 32% of strongly agree/agree responses).

The study defined insider fraud as the malicious or criminal attacks perpetrated upon business or governmental organizations by employees, temporary employees and contractors. Typically, the objective of such attacks is the theft of financial or information assets, which include customer data, trade secrets and intellectual properties. Sometimes, the most dangerous insiders are those who possess strong IT skills or have access to an organization’s critical applications and data.

With this research, we want to reiterate that organizations are not immune,” said Meyers. “The threat of insider fraud is a growing risk that can result in tangible financial loss to businesses. And the longer an organization takes to address it, the more costly it can become

The insider fraud survey includes results from more than 700 individuals at leading global organisations.

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Big Data Analytics can improve IT Security defences

A new study by the Ponemon Institute, Big Data Analytics in Cyber Defense, confirms that Big Data analytics offers substantial benefits to organisations but adoption is very slow.

The report commissioned by Teradata Corporation contains some interesting results:

  • Cyber-attacks are getting worse but only 20% say their organizations are more effective at stopping them.
  • The greatest areas of cyber security risk are caused by mobility, lack of visibility and multiple global interconnected network systems.
  • 56% are aware of the technologies that provide big data analytics and 61% say they will solve pressing security issues, but only 35% have them. The 61% say big data analytics is in their future.
  • 42% of organizations are vigilant in preventing anomalous and potentially malicious traffic from entering networks or detecting such traffic (49%) in their networks.
  • Big data analytics with security technologies ensure a stronger cyber defense.
  • 82% would like big data analytics combined with anti-virus/anti-malware
  • 80% say anti-DoS/DDoS would make their organizations more secure.

While data growth and complexity are explosive factors in cyber defense, new big data tools and data management techniques are emerging that can efficiently handle the volume and complexity of IP network data,” said Dr. Larry Ponemon, Chairman and Founder of the Ponemon Institute, a research “think tank” dedicated to advancing privacy and data protection practices. “These new database analytic tools can bring more power and precision to an enterprise cyber defense strategy, and will help organizations rise to meet the demands of complex and large-scale analytic and data environments

Poneman-Release-Graphic

Many organisations struggle with in-house technology and skill sets

  • 35% say they have big data solutions in place today
  • 51% say they have the in-house analytic personnel or expertise

Big data analytics can bridge the existing gap between technology and people in cyber defense through big data tools and techniques which capture, process and refine network activity data and apply algorithms for near-real-time review of every network node.  A benefit of big data analytics in cyber defense is the ability to more easily recognize patterns of activity that represent network threats for faster response to anomalous activity.

The Ponemon study is a wakeup call,” said Sam Harris, Director of Enterprise Risk Management, Teradata. “Enterprises must act immediately to add big data capabilities to their cyber defense programs to close the gap between intrusion, detection, compromise and containment. When multi-structured data from many sources is exploited, organizations gain a very effective weapon against cyber-crimes

Harris said that in the cyber security realm, effective defense means managing and analyzing unimaginable volumes of network transaction data in near real time. “Many security teams have realized that it is no small feat to quickly sift through all of their network data to identify the 0.1% of data indicating anomalous behavior and potential network threats. Cyber security and network visibility have become a big data problem. Organizations entrusted with personal, sensitive and consequential data need to effectively augment their security systems now or they are putting their companies, clients, customers and citizens at risk

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