Economy lost billions to cybercrime in 2016, report confirms

Gross domestic product growth is robust and job creation is swift for the U.S. economy, an encouraging trend that has enabled both businesses and consumers to increase their earning power. But these successes weren't without some adversities along the way, much of it stemming from cybercrime, where companies – and by extension, the country's economy – were bilked out of their hard-earned money, a recent report reveals.

"Data security breaches may cost the economy upwards of $100 billion in 2016."

According to newly released figures from the Council of Economic Advisers, an arm of the White House, data security breaches cost the economy somewhere between $57 billion and $109 billion in 2016, Bloomberg reported. With companies accepting more forms of payment to improve convenience hackers have a greater number of avenues through which to steal identities and make off with sensitive data that businesses keep in their storage systems.

International cyberthreats significant
While most of the attacks come from within the U.S., cyberthreats are international, hatched from countries all over the world, including Iran, China, North Korea and Russia, the Council of Economic Advisers detailed in its report.

"These groups are well funded and often engage in sophisticated, targeted attacks," authors of the report wrote. "Nation-states are typically motivated by political, economic, technical, or military agendas, and they have a range of goals that vary at different times."

These attacks come in a variety of forms, the report went on to state, including ransom, where businesses are given an ultimatum: pay up or face the consequences. Those victimized may never get their data back – even if they do pay the ransom fee – or their computer systems may be infected with malicious software.

"The Cost of Malicious Cyber Activity to the U.S. Economy" report also defined the types of actors who participate in these attacks, among them so-called "hacktivists," which the CEA described as typically private individuals who are agenda driven, often politically.  

"Cyber threats are ever-evolving and may come from sophisticated adversaries," Bloomberg quoted from the CEA report. "Due to common vulnerabilities, instances of security breaches occur across firms and in patterns that are difficult to anticipate."

"Companies say they've hired more personnel to handle  data security."

77 percent admit they don't have a cybersecurity protocol
Some companies, however, may not be taking cybercrime as seriously as they ought to be, in effect believing they won't be compromised or simply failing to prioritize protection out of a false sense of security. More than three-quarters of businesses confess they lack a formal cybersecurity plan, according to a separate study conducted by the Ponemon Institute. Nevertheless, 7 in 10 are of the mind that they're in better position to fend off an attack than in 2017.

Ted Julian, vice president of product management at IBM Resilient, which sponsored the study, chalked up business owners' confidence to better staffing, hiring those who are trained to deal with hacks.

IT personnel represent only one part of the data security puzzle. 911 Software has the credit processing software that can more effectively shore up your company's defenses.

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