Cyber crime costs £27bn

Marion Dakers
INTERNET crime costs the British economy more than £27bn a year and appears to be “endemic”, according to the first government-sponsored study of online fraud, released yesterday.

Businesses are worst affected, taking an estimated £21bn hit last year, though the government also lost £2.2bn and individuals were ripped off to the tune of £3.1bn in 2010.

The report said £9.2bn was lost from intellectual property theft, £7.6bn from industrial espionage and £2.2bn from extortion, with large companies being targeted in particular.

UK citizens lost an estimated £1.8bn through identity theft and £1.4bn in online scams, according to research by consultancy Detica, a subsidiary of BAE Systems, on behalf of the Cabinet Office.

“Our estimates are largely illustrative because we believe this type of cyber crime goes largely unreported,” the report said, adding that the real total could be higher.

Such crime is highly lucrative, easy to get involved in, plus the relative anonymity provided by technology lowers the risk of being caught, the study said.

The hardest hit sectors are thought to be pharmaceuticals and biotech, electronics, IT and chemicals.

Security minister Baroness Neville-Jones said the research “highlights the opportunity we have to turn this to our advantage and get ahead of the curve to drive our economic growth and prosperity”.

The government estimated in October as part of the strategic defence review that cyber crime is one of the gravest threats to UK security, costing the world $1 trillion (£618bn) per year.

Around £650m was devoted to tackling online crime in the defence review, some of which has gone towards a new Office of Cyber Security and Information Assurance.