No business is too small to evade a cyber attack or data breach. Unfortunately, smaller organizations may not have the budget and in-house expertise to harden their systems and networks against potential threats. In fact, only 14 percent of the companies represented in this study rate their ability to mitigate cyber risks, vulnerabilities and attacks as highly effective. Moreover, the introduction of cloud applications and infrastructure and more mobile devices is creating more security risks that will stretch these companies’ resources.

Ponemon Institute is pleased to present the results of the 2016 State of Cybersecurity in Small and Medium-Sized Business sponsored by Keeper Security. We surveyed 598 individuals in companies with a headcount from less than 100 to 1,000.

Some 55 percent of these respondents say their companies have experienced a cyber attack in the past 12 months, and 50 percent report they had data breaches involving customer and employee information in the past 12 months. In the aftermath of these incidents, these companies spent an average of $879,582 because of damage or theft of IT assets. In addition, disruption to normal operations cost an average of $955,429.

The following 10 findings reveal the state of cybersecurity in smaller businesses.

1. The most prevalent attacks against smaller businesses are Web-based and phishing/social engineering.

2. Negligent employees or contractors and third parties caused most data breaches. However, almost one-third of companies in this research could not determine the root cause.

3. Companies are most concerned about the loss or theft of their customers’ information and their intellectual property.

4. Strong passwords and biometrics are believed an essential part of the security defense. However, 59 percent of respondents say they do not have visibility into employees’ password practices such as the use of unique or strong passwords and sharing passwords with others.

5. Password policies are not strictly enforced. If a company has a password policy, 65 percent of respondents say they do not strictly enforce it. Moreover, the policy does not require employees to use a password or biometric to secure access to mobile devices.

6. Current technologies cannot detect and block many cyber attacks. Most exploits have evaded intrusion detection systems and anti-virus solutions.

7. Personnel, budget and technologies are insufficient to have a strong security posture. As a result, some companies engage managed security service providers to support an average of 34 percent of their IT security operations.

8. Determination of IT security priorities is not centralized. The two functions most responsible are chief executive and chief information office. However, 35 percent of respondents say no one function in their company determines IT security priorities.

9. Web and intranet servers are considered the most vulnerable endpoints or entry points to networks and enterprise systems. The challenge of not having adequate resources may prevent many companies from investing in the technologies to mitigate these risks. Web application firewalls, SIEM, endpoint management, network traffic intelligence are not considered very important in current security strategy. At a minimum anti-malware and client firewalls are considered the most important security technologies.

10. Cloud usage and mobile devices that access business-critical applications and IT infrastructure will increase and threaten the security posture of companies in this study. However, only 18 percent of respondents say their company uses cloud-based IT security services and most password policies do not require employees to use a password or biometric to secure access to their mobile devices.

 

Download the full report here.

Baseball has long celebrated cheating, but electronic cheating just sent a former team front-office worker to prison for nearly four years.

Former St. Louis Cardinals scouting director Chris Correa, who earlier pled guilty to using old passwords to access a former team’s scouting database, was sentenced to 46 months in jail on Monday. Correa broke into the Houston Astros’ computer systems repeatedly, stealing data. He had previously worked for the Astros.

Correa has been dubbed a hacker by sports media, but he simply made educated guesses to break into his old team’s computer database, mainly to download scouting intelligence that might help the Cardinals gain insight into players the Astros wanted to draft or trade for.

The long sentence was tied to the economic loss “suffered” by the Astros…and here things get confusing. According to STLToday.com, federal prosecutors essentially calculated how much money the Astros spent developing the data in their player database.

Assistant U.S. Attorney Michael Chu, who handled the hearing, listed the formula used to arrive at $1.7 million.

“But since much of the data that we looked at focused on the 2013 draft, what we did was we took the number of players that he looked at by 200 and we divided that by the number of players that were eligible to be drafted that year, and we multiplied that times the scouting budget of the Astros that year. That comes to $1.7 million,” he said.

That kind of loss meant a sentence of 36-48 months, according to federal guidelines.

That kind of jail time sounds like a lot for what some might consider the equivalent of stealing a third-base coach’s signs…particularly when you hear about rapists getting 6-month sentences…but it is not out of line with many computer criminal punishments.

There has long been debate about fairness in hacker sentencing, a debate that reached fever pitch after Aaron Swartz for “hacking” research and received a 30-year sentence and ultimately committed suicide.

Again, Correa is no hacker.  When I talked to Morey Haber, vice president of technology at BeyondTrust, he sharply defended the sentence.

“Yes, there is a certain amount of cheating that goes on (in sports), but that’s during the game,” he said. “This is corporate espionage. It’s no different from hacking a bank…It’s no different than if you went from Lockheed Martin to Northrup Grumman (and hacked into your old employer)….It’s not acceptable and courts are sending a strong message.”

Whatever you feel about Correa’s sentence — and hanging questions about whether or not he could have been the only one who knew about all this — there are three really important lessons to learn from the Cardinals hack.\

First, Correa actually told the judge during a hearing that he started breaking into Astros computers because he was afraid they were doing the same thing to him.  That may or may not be true. But “hacking back,” however tempting, is a crime. And it can steal several years from your life.

Second, using an old password to log into your old company — or slight variations of that — might seem like a fairly innocent thing to do. Maybe you forgot a contact phone number, or there’s a document (you wrote!) that you’d like to see one more time.  This kind of “hacking” can feel like no crime at all. It’s just a few keystrokes.

Doing that can also cost you years of your life.

Finally, to you Astros-like companies out there.  Passwords can be easily guessed.  And they can be really easily guessed by former employers who know the password tendencies of your current employees.  Look at this section of the court transcript that describes the ‘hack.’

“It was based on the name of a player who was scrawny and who would not have been thought of to succeed in the major leagues, but through effort and determination he succeeded anyway. So this user of the password just liked that name, so he just kept on using that name over the years. … Kind of like Magidson123… Or Magidson1/2,1/4,1/3.

Have a smarter authentication system than that. At least change the indicator once in a while. (That’s a baseball joke.)

Baseball has long celebrated cheating, but electronic cheating just sent a former team front-office worker to prison for nearly four years.

Former St. Louis Cardinals scouting director Chris Correa, who earlier pled guilty to using old passwords to access a former team’s scouting database, was sentenced to 46 months in jail on Monday. Correa broke into the Houston Astros’ computer systems repeatedly, stealing data. He had previously worked for the Astros.

Correa has been dubbed a hacker by sports media, but he simply made educated guesses to break into his old team’s computer database, mainly to download scouting intelligence that might help the Cardinals gain insight into players the Astros wanted to draft or trade for.

The long sentence was tied to the economic loss “suffered” by the Astros…and here things get confusing. According to STLToday.com, federal prosecutors essentially calculated how much money the Astros spent developing the data in their player database.

Assistant U.S. Attorney Michael Chu, who handled the hearing, listed the formula used to arrive at $1.7 million.

“But since much of the data that we looked at focused on the 2013 draft, what we did was we took the number of players that he looked at by 200 and we divided that by the number of players that were eligible to be drafted that year, and we multiplied that times the scouting budget of the Astros that year. That comes to $1.7 million,” he said.

That kind of loss meant a sentence of 36-48 months, according to federal guidelines.

That kind of jail time sounds like a lot for what some might consider the equivalent of stealing a third-base coach’s signs…particularly when you hear about rapists getting 6-month sentences…but it is not out of line with many computer criminal punishments.

There has long been debate about fairness in hacker sentencing, a debate that reached fever pitch after Aaron Swartz for “hacking” research and received a 30-year sentence and ultimately committed suicide.

Again, Correa is no hacker.  When I talked to Morey Haber, vice president of technology at BeyondTrust, he sharply defended the sentence.

“Yes, there is a certain amount of cheating that goes on (in sports), but that’s during the game,” he said. “This is corporate espionage. It’s no different from hacking a bank…It’s no different than if you went from Lockheed Martin to Northrup Grumman (and hacked into your old employer)….It’s not acceptable and courts are sending a strong message.”

Whatever you feel about Correa’s sentence — and hanging questions about whether or not he could have been the only one who knew about all this — there are three really important lessons to learn from the Cardinals hack.\

First, Correa actually told the judge during a hearing that he started breaking into Astros computers because he was afraid they were doing the same thing to him.  That may or may not be true. But “hacking back,” however tempting, is a crime. And it can steal several years from your life.

Second, using an old password to log into your old company — or slight variations of that — might seem like a fairly innocent thing to do. Maybe you forgot a contact phone number, or there’s a document (you wrote!) that you’d like to see one more time.  This kind of “hacking” can feel like no crime at all. It’s just a few keystrokes.

Doing that can also cost you years of your life.

Finally, to you Astros-like companies out there.  Passwords can be easily guessed.  And they can be really easily guessed by former employers who know the password tendencies of your current employees.  Look at this section of the court transcript that describes the ‘hack.’

“It was based on the name of a player who was scrawny and who would not have been thought of to succeed in the major leagues, but through effort and determination he succeeded anyway. So this user of the password just liked that name, so he just kept on using that name over the years. … Kind of like Magidson123… Or Magidson1/2,1/4,1/3.

Have a smarter authentication system than that. At least change the indicator once in a while. (That’s a baseball joke.)