Barack Obama’s war on cyber espionage has not stopped theft of trade secrets

Washington: Two years ago, the Obama administration announced a new strategy to curb online espionage.

The White House said it would increase public awareness of the threat, encourage the private sector to increase its defences, focus diplomacy on protecting trade secrets overseas, improve trade secret theft legislation and make investigations and prosecutions of corporate and state-sponsored trade secret theft a top priority.

Since then, public awareness is up and so is spending. But the hacking continues.

The private sector spent $US665 million ($837 million) on data loss prevention last year, according to the technology research firm Gartner, with a 15 per cent increase expected this year. On the legislative front, Congress strengthened penalties for those convicted under the Economic Espionage Act, raising the maximum fine for individuals convicted to $US5 million from $US500,000. And in terms of law enforcement, the FBI lists digital crime, including intrusions that result in trade secret theft, as its third priority, just behind terrorism and counter-intelligence. The agency reported a 60 per cent increase in trade secret investigations from 2009 to 2013.

But diplomatic efforts to engage China on the topic have largely failed. China’s response has simply been that it, too, is a victim of online attacks. And online espionage shows little sign of abating.

Last year, 18 per cent of the 1598 confirmed breaches analysed by telecommunications company Verizon were used for online espionage, compared with 22 per cent of 1367 attacks in 2013. Senator Sheldon Whitehouse told a Senate Judiciary Committee hearing last year that 1 to 3 per cent of US gross domestic product was still lost, every year, through trade secret theft.

“There hasn’t been any change,” James Lewis, a digital security expert at the Centre for Strategic and International Studies in Washington, said.

“There’s a lot more we can do. But we haven’t reached our pain point for taking more drastic steps on cyber espionage, and the Chinese haven’t reached their pain point for stopping it.”

Full article: Barack Obama’s war on cyber espionage has not stopped theft of trade secrets (The Age)

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