Economic espionage and cybercrime – evidence and strategy

Each year, criminals steal an estimated £280 billion of secret information. These crimes are hidden, with the perpetrators potentially thousands of miles away.

Where does this crime happen? In the cyber world.

Cyber criminals target valuable company assets, as they hack computers and bypass security systems to steal confidential business information, prototype designs, strategic bid information and customer lists. These assets are collectively known as trade secrets, as they derive their value from their secrecy.

When this theft is done to benefit foreign countries, it is known as economic espionage. Concerned governments and companies are effecting important changes to combat this problem. Yet, despite the huge economic impact of these thefts, very little is known about them. This research seeks to address this lack of knowledge by investigating data on the theft of trade secrets to understand their economic impact.

Using a unique source of data, this research examines what is actually happening in cybercrime. Analysis of information from court cases generates a systematic understanding of what is stolen, who the criminals are, and how this affects victims and the economy as a whole.

By definition, the stolen trade secrets are secret, and therefore very difficult to investigate. This project uses the rare insights and information found in court cases to tease out a better understanding of this cybercrime.

Over the course of this project, a team of researchers will collect and analyse court data. The researchers will use statistical and other analytical techniques to create a robust understanding of trade secret theft and its implications. These findings will be publicised using conferences, seminars, academic papers and social media, so that groups and individuals interested in these topics can engage with this project and the research team.

This research will benefit businesses, policy makers, researchers and the general public.

Businesses will have a better understanding of the value of their trade secrets and how best to protect them.

Policy makers will be able to develop better policy as the project will generate evidence to ground economic insights and objective analysis into action.

Researchers and innovators, from the fashion designer working on their next collection, to the aerospace engineer developing a new aeroplane, will be able to better protect their valuable prototypes, software programs and other trade secrets.

Finally, the general public will benefit from enhanced security and improved policy environment. Improved cyber security means better protection of personal data. The policies informed by this research will encourage innovation. Innovation improves lives, as we enjoy new fashions, advanced aeroplanes and new medicines.

To better understand trade secrets, economic and industrial espionage, and the role of cybercrime, this project adopts three empirical methodologies: court data, survey and in-depth interviews.

A key source of data is the collection of over 200 criminal court cases of prosecutions under the U.S. Economic Espionage Act. Over 3,000 documents have been collected, with coding and analysis underway. These documents are a rich source of data in terms of better understanding: perpetrators, the stolen trade secrets, the means of theft, the value of the stolen secret and others. This data set represents the entire population of these cases from 1996 to 2018.

Further data is collected by a survey targeting UK and international firms to better understand how they protect their trade secrets, the type of trade secrets and the threats they perceive.

Finally, a series of in-depth interviews with trade secrets experts provides richer data to round out the research.

The analytical technique is a mix of qualitative and quantitative, and is grounded in economics and incorporates management, law and socio-technical approaches.

Basuchoudhary, Atin and Searle, Nicola. 2019. Snatched Secrets: Cybercrime and Trade Secrets Modelling a firm's decision to report a theft of trade secrets. Computers & Security, 87(101591), ISSN 0167-4048.