Been Down So Long It Looks Like Up To Me: The Extent and Scope of the Cybercrime Problem

Been Down So Long It Looks Like Up To Me: The Extent and Scope of the Cybercrime Problem

In May 2000, the FBI reported that crime in the United States dropped for a record eighth straight year in 1999, with homicides, assaults, robberies, and other serious offenses falling by 7%. The FBI, which has been compiling criminal data since the 1930s, has never before reported a drop in the crime rate for eight successive years.

Unfortunately, although the crime rate in the physical space of the United States might be decreasing, the crime rate in cyberspace is increasing.

The following four diverse sources provide some fascinating data:

• CSI/FBI Computer Crime and Security Survey

• Computer Emergency Response Team's (CERT) statistics on incidents, vulnerabilities, alerts, and so on

• Dan Farmer's Internet Security Survey

• WarRoom Research's Information Security Survey

The CSI/FBI Computer Crime and Security Survey

In the summer of 1995, I received a call from FBI Special Agent Pat Murphy, a member of the San Francisco FBI's newly formed Computer Intrusion Squad. The S.F. unit was only the second one established in the entire country. (Washington, D.C. was the first; New York was the third.)

The FBI's regional Computer Intrusion Squads investigate violations of the Computer Fraud and Abuse Act (Title 18, Section 1030), including intrusions to public switched networks, major computer network intrusions, privacy violations, industrial espionage, pirated software, and other crimes.

A few days later, I met with Murphy and Supervisory Special Agent George Vinson on the 13th floor of the Federal Office Building on 450 Golden Gate Avenue in the Tenderloin. They had a lot of questions. How bad is the computer crime problem? How often are corporations attacked? Which computer crimes are the most common? What kinds of financial losses are being incurred?

I told Murphy and Vinson that they were asking the important questions, but that no one had the answers. Furthermore, the answers would be hard to come by. Corporations are loath to admit bad news.

I suggested that we could conduct an anonymous survey of CSI members (information security practitioners in Fortune 500 companies and large government agencies). I invited Murphy and Vinson to submit the questions that they wanted answered. That's how simply it began.

The CSI/FBI Computer Crime and Security Survey was undertaken as a public service by the Computer Security Institute (CSI), with the participation of the San Francisco Federal Bureau of Investigation's (FBI) Computer Intrusion Squad. This ongoing effort aims to raise the level of security awareness as well as to assist in determining the scope of computer crime in the United States.

The success of the survey is unprecedented in the field of information security.

Now in its fifth year, the annual release of the results of the CSI/FBI Computer Crime and Security Survey is a major international news story, covered widely in the mainstream print and broadcast media. The CSI/FBI is, for better or worse, the most widely cited research on the extent and scope of cybercrime and related security problems. Furthermore, throughout the year, the survey results are referenced in numerous presentations, articles, and papers on the nature and scope of computer crime.

The CSI/FBI survey results led to my 1996 U.S. Senate testimony. The CSI/FBI survey results led to my journeys to South Africa, Japan, Brazil, Portugal, Norway, and elsewhere to deliver executive briefings on cybercrime and information warfare.

Based on responses from 643 computer security practitioners in U.S. corporations and government agencies, the findings of the CSI/FBI 2000 Computer Crime and Security Survey confirm the trends that have emerged over the previous years:

• Organizations are under cyberattack from both inside and outside their electronic perimeters.

• A wide range of cyberattacks have been detected.

• Cyberattacks can result in serious financial losses.

• Defending successfully against such attacks requires more than just the use of information security technologies.

Patrice Rapalus, CSI Director (and my boss), elaborates: "The trends the CSI/FBI survey has highlighted over the years are disturbing. Cybercrimes and other information security breaches are widespread and diverse. Furthermore, such incidents can result in serious damages.

"Clearly," she continues, "more must be done in terms of adherence to sound practices, deployment of sophisticated technologies, and most importantly adequate staffing and training of information security practitioners in both the private sector and government."

Bruce J. Gebhardt is in charge of the FBI's Northern California office. Based in San Francisco, his division covers 15 counties, including the continuously expanding Silicon Valley area. Computer crime is one of his biggest challenges.

"If the FBI and other law enforcement agencies are to be successful in combating this continually increasing problem," he says, "we cannot always be placed in a reactive mode, responding to computer crises as they happen. The results of the CSI/FBI survey provide us with valuable data. This information not only has been shared with Congress to underscore the need for additional investigative resources on a national level but identifies emerging crime trends and helps me decide how best to proactively and aggressively assign resources, before those 'trends' become 'crises.'"

In the midst of the media interest in the release of the fifth annual CSI/FBI survey results, several reporters asked, "What surprises you most about this year's data?"

"Well," I answered, "the only surprise is that there aren't any surprises."

For example, the number of respondents reporting their Internet connections as a frequent point of attack has increased every year for five years.

Being able to look at responses to the same questions over a period of several years provides an invaluable, unprecedented glimpse into what's really going on out there.

Here is a summation of what we have gleaned over the life cycle of the project so far.

Whom We Asked

Most respondents work for large corporations. The heaviest concentrations of respondents are in the financial services and high-tech sectors (each represents 17% of respondents). Manufacturing is the next largest industry segment (10% of respondents).

Figure 3.1 Respondents by industry sector.
Source: 2000 CSI/FBI Computer Crime and Security Survey 2000: 643 Respondents/100%

The public sector is well represented. When taken together, federal (9%), state (7%), and local (2%) government agencies comprise another 18% of respondents.

Organizations in other vital areas of the national infrastructure also responded: for example, medical institutions (7%), telecommunications (4%), and utilities (4%).

The responses come from organizations with large payrolls—for example, 30% reported 10,000 or more employees, 12% reported from 5,001 to 9,999 employees.

Figure 3.2 Respondents by number of employees.
Source: 2000 CSI/FBI Computer Crime and Security Survey 2000: 640 Respondents/99%

Forty-three percent of respondents in the commercial sector reported a gross income over $1 billion; 11% reported gross income of from $501 million to $1 billion. (Interestingly, these two figures are reversed from the 1999 results: Last year, 40% indicated from $501 million to $1 billion and 16% indicated over $1 billion. Further evidence of the economic prosperity of the mid-1990s?)

Figure 3.3 Respondents by gross income.
Source: 2000 CSI/FBI Computer Crime and Security Survey 2000: 422 Respondents/65%

Consider the 643 survey responses in regard to industry sector, number of employees, and gross income. Clearly, the results demand your attention. The types of incidents reported (whether illegal, litigious, or simply inappropriate), as well as the trends that the five-year life of the survey confirm, have the potential to do serious damage to U.S. economic competitiveness.

Unless information security is the focus of concerted efforts throughout both the public and private sector, the rule of law in cyberspace as well as U.S. leadership in the global marketplace will be undermined.

Outlaw Blues

How widespread are cyberattacks and other information security breaches?

For five years, we have asked the following question: "Have you experienced unauthorized use of computer systems within the last 12 months?" In 1996, 42% answered "yes." In 2000, 70% answered "yes." (Note: These figures are adjusted to exclude those who answered "yes," but only reported incidents of computer viruses, laptop theft, and/or some form of employee abuse of network privileges.)

Figure 3.4 Unauthorized use of computer systems within the last 12 months.
Source: 2000 CSI/FBI Computer Crime and Security Survey 2000: 585 Respondents/91%; 1999: 512 Respondents/98%; 1998: 515 Respondents/99%; 1997: 391 Respondents/69%; 1996: 410 Respondents/96%

It is encouraging to see the precipitous decline of those who responded "no" to this question from 37% in 1996 to 16% in 2000. In 1997, 33% of respondents answered "no." In the "Briefing Notes" for the 1997 study I wrote, "After all, 'yes' and 'don't know' are probably the only honest answers to this question." In 1998, the number of respondents who answered "no" fell to 18%.

Now, in the fifth year of the survey results, the number of respondents who answered "don't know" has finally fallen: from 21% in 1999 to 12% in 2000.

What does this all mean? People are no longer living in denial. They are looking more closely at activity on their networks. Furthermore, they are using better tools to look, and they are less reluctant to answer "yes."

What about the origin of attacks? Well, although many Pollyannas still cling to the conventional wisdom that "80% of the problem is insiders, only 20% of the problem is outsiders," the number of respondents reporting their Internet connections as a frequent point of attack has increased every year: rising from 37% in 1996 to 59% in 2000. Meanwhile, the number of respondents citing their internal systems as frequent points of attack actually fell from 51% in 1999 to 38% in 2000.

Figure 3.5 Internet connection is increasingly cited as a frequent point of attack.
Source: CSI/FBI 2000 Computer Crime and Security Survey 2000: 443 Respondents/68%; 1999: 324 Respondents/62%; 1998: 279 Respondents/54%; 1997: 391 Respondents/69%; 1996: 174 Respondents/40%

The conventional wisdom about 80% of perpetrators being insiders and 20% being outsiders is simply no longer supported by the data. It isn't that the threat from insiders has decreased; it is simply that the threat from the outside has risen dramatically because of the rise of the Internet as a means of business communication.

In the 1965 ballad "Outlaw Blues," Bob Dylan boasted, "Don't ask me nothin' about nothin', I just might tell you the truth."

Types of Cyberattack

For the last four years, we have asked the question, "Which of the following types of electronic attack or misuse has your organization detected within the last 12 months?"

In 2000, respondents reported a wide range of attacks and abuses. Here are some examples:

• 11% detected financial fraud

• 17% detected sabotage of data and/or networks

• 20% detected theft of proprietary information

• 25% detected system penetration from the outside

• 27% detected denial of service

• 71% detected unauthorized access by insiders

• 79% detected employee abuse of Internet access privileges

• 85% detected viruses

To Report or Not to Report

The aim of the annual CSI/FBI Computer Crime and Security Survey is not only to gather data on the dark side of cyberspace but to foster greater cooperation between law enforcement and the private sector so that both can provide a viable deterrent to cybercrime.

For the first three years, only 17% of those who suffered serious attacks reported them to law enforcement. In the 1999 survey, 32% answered that they had reported such incidents to law enforcement. In 2000, the percent of respondents who reported intrusions to law enforcement dropped to 25%.

Figure 3.6 Types of attack or misuse detected in the last 12 months (by percent).
Source: 2000 CSI/FBI Computer Crime and Security Survey 2000: 581 Respondents/90%; 1999: 405 Respondents/78%; 1998: 458 Respondents/89%; 1997: 492 Respondents/87%

Figure 3.7 Has your WWW site suffered unauthorized access or misuse within the last 12 months? Ninety-five percent of respondents have WWW sites; 43% provide electronic commerce services via their WWW sites; only 30% were doing e-commerce in 1999.
Source: 2000 CSI/FBI Computer Crime and Security Survey2000: 603 Respondents/93%; 1999: 479 Respondents/92%

Figure 3.8 If your organization has experienced computer intrusion(s) within the last 12 months, which of the following actions did you take?
Source: 2000 CSI/FBI Computer Crime and Security Survey 2000: 407 Respondents/63%; 1999: 295 Respondents/57%; 1998: 321 Respondents/72%; 1997: 317 Respondents/56%; 1996: 325 Respondents/76%

Figure 3.9 The reasons organizations did not report intrusions to law enforcement.
Source: 2000 CSI/FBI Computer Crime and Security Survey 2000: 209 Respondents/32%; 1999: 107 Respondents/20%; 1998: 96 Respondents/19%; 1997: 142 Respondents/25%; 1996: 64 Respondents/15%

Dr. Dorothy Denning of Georgetown University (Washington, D.C.) comments that a smaller percentage of companies reported incidents to law enforcement in 2000 than in 1999, but the number was still greater than for preceding years, and the percentage citing negative publicity or concern about competitors using it to advantage decreased. "Thus," she says, "the decline in reporting from last year could be due to other factors, such as the cost of dealing with an investigation or expectation that an investigation will not be successful."

Indeed, as Dr. Denning observed, it does seem that, at least among CSI/FBI survey respondents, the taboos against reporting are dropping precipitously. The percent of respondents that cited "negative publicity" fell from 84% to 52%; the percent that cited fear that "competitors would use news of the intrusion to gain competitive advantage" fell from 79% to 39%.

Rik Farrow (http://www.spirit.com), a CSI faculty member, adds some insight.

"The FBI has completed several prosecutions where the identity of the cybervictims was never divulged. This is an encouraging sign for those who fear adverse publicity. At the same time, a person who caused a tremendous amount of damage and gets convicted can expect to receive a much lighter sentence than a person found with a small amount of marijuana. A security director who works for a bank mentioned that the bank prefers to go after civil penalties when possible, as these penalties (plus the cost of paying defense lawyers) are likely to be much more severe."

The Truth Is Out There

The CSI/FBI Computer Crime and Security Survey is a non-scientific, informal but narrowly focused poll of information security practitioners.

The survey is, at best, a series of snapshots that give some sense of the "facts on the ground" at a particular time. The findings are in large part corroborated by data from other reputable studies, as well as by real-world incidents documented in open source publications. I also suggest that the findings of the CSI/FBI survey are also strengthened by having five straight years of data to draw on.

CSI offers the survey results as a public service. The report is free to anyone who requests a copy. The participation of the FBI's San Francisco office has been invaluable. It has provided input into the development of the survey itself and acted as our partner in the effort to encourage response. But CSI has no contractual or financial relationship with the FBI. It is simply an outreach and education effort on the part of both organizations. CSI foots the bill for the project and is solely responsible for the results.

Hopefully, somewhere in the mix of real-world horror stories and data points contained in this report, there is something relevant to the information protection needs of your organization that will help you make your quadrant of cyberspace safer for creation, communications, and commerce.

A Note on Methodology

Questionnaires with business reply envelopes were sent by U.S. post to 4,284 information security professionals; 643 responses were received for a 15% response rate.

In 1999, 521 responses were received (14% of 3,670 questionnaires sent). In 1998, 520 responses were received (13% of 3,890 questionnaires sent). In 1997, 563 responses were received (11% of 4,899 questionnaires sent). In 1996, 428 responses were received (8% of 4,971 questionnaires sent).

The responses were anonymous. Job titles of those queried range from information security manager to data security officer to senior systems analyst. Organizations surveyed include corporations, financial institutions, government agencies, and universities in the United States.

Relevant Data from Other Sources

I've culled the following data from serious research undertaken by some diverse entities.