Organized Crime Draws Cyber Bead on Financial Services

April 17, 2009

More electronic records were breached in 2008 than the previous four years combined, fueled by a targeting of the financial services industry and a strong involvement of organized crime, according to the "2009 Verizon Business Data Breach Investigations Report" (DBIR).

This second annual study -- based on data analyzed from Verizon Business' actual caseload comprising 285 million compromised records from 90 confirmed breaches -- revealed that corporations fell victim to some of the largest cybercrimes ever during 2008. The financial sector accounted for 93 percent of all such records compromised last year, and a staggering 90 percent of these records involved groups identified by law enforcement as engaged in organized crime.

Verizon Business investigative experts found, as they did in the company's first report covering 230 million compromised records from 2004 to 2007, that nearly nine out of 10 breaches were considered avoidable if security basics had been followed. Most of the breaches investigated did not require difficult or expensive preventive controls. The 2009 report concluded that mistakes and oversight failures hindered security efforts more than a lack of resources at the time of the breach.

Similar to the first study's findings, the latest study found that highly sophisticated attacks account for only 17 percent of breaches. However, these relatively few cases accounted for 95 percent of the total records breached - proving that motivated hackers know where and what to target.

"The compromise of sensitive information increased dramatically in 2008, and it's past time to be vigilant about enterprise security," said Dr. Peter Tippett, vice president of research and intelligence for Verizon Business Security Solutions. "This report should serve as another wake-up call that good security and a proactive approach are paramount to running a business in this day and age -- particularly since the economic crisis is likely to trigger a further increase in criminal activity."

KEY FINDINGS OF THE 2009 REPORT

This year’s key findings support last year’s conclusions and provide new insights. These include:

• Most data breaches investigated were caused by external sources.
  • 74 percent of breaches resulted from external sources.
  • 32 percent were linked to business partners.
  • 20 percent were caused by insiders, a finding that may be contrary to certain widely held beliefs.

• Most breaches resulted from a combination of events rather than a single action.
  • 64 percent of breaches were attributed to hackers who used a combination of methods.
  • In most successful breaches, the attacker exploited some mistake committed by the victim, hacked into the network, and installed malware on a system to collect data.
• In 69 percent of cases, the breach was discovered by third parties.
  • The ability to detect a data breach when it occurs remains a huge stumbling block for most organizations. Whether the deficiency lies in technology or process, the result is the same.
  • During the last five years, relatively few victims discovered their own breaches.
• Nearly all records compromised in 2008 were from online assets.
  • Despite widespread concern over desktops, mobile devices, portable media and the like, 99 percent of all breached records were attributable to compromised servers and applications.
• Roughly 20 percent of 2008 cases involved more than one breach.
  • Multiple distinct entities or locations were individually compromised as part of a single case, and remarkably, half of the breaches consisted of interrelated incidents often caused by the same individuals.
• Being PCI-compliant is critically important.
  • A staggering 81 percent of affected organizations subject to the Payment Card Industry Data Security Standard (PCI-DSS) had been found non-compliant prior to being breached.