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The Resource Center Credit Fraud & Credit Monitoring | post

Is the cybercrime business really bigger than the drug trade?

by Neal O'Farrell on

Intersections’ Consumer Security Adviser Neal O’Farrell reports on a recent report by Symantec that compares cybercrime to the world wide drug trade. Interesting stuff!.

It's the claim (sort of) of an eye-opening report recently published by Symantec. According to the Norton Cybercrime Report 2011, the global cost of cybercrime was nearly $388 billion last year. That number is made up of $144 billion in direct financial losses by victims, and another $274 billion in losses due to lost time and other indirect costs as a result of the attacks.

Norton then compared that to a number of United Nations World Drug Reports over the last few years that pegged the black market for marijuana, cocaine and heroin combined at $288 billion, coming to the conclusion that the global cost of cybercrime exceeded the drug market.

Hard to argue with, except that many media outlets have been reporting that Norton's study claims that cybercriminals make more money than drug distributors. Which is obviously not the case, at least not yet — the report claims that victims lost $388 billion in direct and indirect losses but not that the crooks actually made that money.

But I'm sure it's only a matter of time before the profits from cybercrime, and especially identity theft, exceed those from the drug trade. Just recently I spoke at a security conference for law enforcement where we discussed a recent case in Florida called Operation Rainmaker, an identity theft and tax fraud scheme that netted street level drug dealers more than $130 million simply by switching from dealing drugs on street corners to committing identity theft with laptops.

Here are some of the other findings of the report:

  • More than two thirds of online adults (69 percent) have been a victim of cybercrime in their lifetime.
  • Every second 14 adults become a victim of cybercrime, resulting in more than one million cybercrime victims every day.
  • 10 percent of adults online have experienced cybercrime on their mobile phone.
  • Increased social networking and a lack of protection are the main culprits behind the growing number of cybercrime victims.
  • Men between 18 and 31 years old who access the Internet from their mobile phone are most likely to be victims.
  • Globally, the most common — and most preventable — type of cybercrime is computer viruses and malware, with 54 percent of respondents saying they have experienced it in their lifetime.
  • Viruses are followed by online scams (11 percent) and phishing messages (10 percent). Earlier this year the Symantec Internet Security Threat Report, Volume 16, found more than 286 million unique variations of malicious software ("malware") compared to the 240 million reported in 2009.
  • Forty-one percent of adults indicated they don't have an up-to-date security software suite to protect their personal information online.
  • Less than half review credit card statements regularly for fraud (47 percent), and 61 percent don't use complex passwords or change them regularly.

Read the full report for more findings from the Norton Cybercrime Report globally and by country.

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