Insider threats costing organisations $15.4 million a year

Insider threats are costing organisations $15.4 million a year, according to Proofpoint.

Proofpoint has released its 2022 Cost of Insider Threats Global Reportto identify the costs and trends associated with negligent, compromised, and malicious insiders.

Notably, on average, impacted organisations spent USD$15.4 million annually on overall insider threat remediation and took 85 days to contain each incident.

The report, independently conducted by Ponemon Institute, is issued every 2 years and is now in its fourth edition. It surveyed over 1,000 IT and IT security practitioners across North America, Europe, Middle East, Africa, and Asia-Pacific. Each organisation included in the study experienced one or more material events caused by an insider.

The report reveals that over the last two years, the frequency and costs associated with insider threats have increased dramatically across all three insider threat categories, including: careless or negligent employees/contractors, criminal or malicious insiders, and cybercriminal credential theft.

"Months of sustained remote and hybrid working leading up to The Great Resignation has resulted in an increased risk around insider threat incidents, as people leave organisations and take data with them," says Ryan Kalember, executive vice president of cybersecurity strategy at Proofpoint.

"In addition, organisational insiders, including employees, contractors, and third-party vendors, are an attractive attack vector for cybercriminals due to their far-reaching access to critical systems, data, and infrastructure," he says.

"With people now the new perimeter, we recommend layered defenses, including a dedicated insider threat management solution and strong security awareness training, to provide the best protection against these types of risks.

This year's 2022 Cost of Insider Threats Global Report key findings include:

·         Organisations impacted by insider threats spent an average of USD$15.4 million annually—that's up 34 percent from USD$11.45 million in 2020.

·         The overall number of incidents has increased by a staggering 44 percent in just two years. The frequency of incidents per company has also gone up with 67 percent of companies experiencing between 21 and more than 40 incidents per year, up from 60 percent in 2020.

·         The negligent insider is the root cause of most incidents. 56% of reported insider threat incidents were the result of a careless employee or contractor, costing on average USD$484,931 per incident. This could be the result of a variety of factors, including not ensuring their devices are secured, not following the company's security policy, or forgetting to patch and upgrade.

·         Malicious or criminal insiders were behind 1 in 4 incidents (26%) at an average cost per incident of USD$648,062. Malicious insiders are employees or authorised individuals who use their data access for harmful, unethical, or illegal activities. Because employees are increasingly granted access to more information to enhance productivity in today's work-from-anywhere workforce, malicious insiders are harder to detect than external attackers or hackers.

·         Credential theft incidents have almost doubled since the last study. At an average of USD$804,997 per incident, credential theft is the costliest to remediate. The intent of the credential thief is to steal users' credentials that will grant them access to critical data and information. A total of an average 1,247 incidents (or 18%) involved cybercriminals stealing credentials.

·         The time to contain an insider incident increased from the last study. It takes an average of nearly three months (85 days) to contain an insider incident up from 77 days in the previous study. Incidents that took more than 90 days to contain cost organisations USD$17.19 million on an annualised basis, while incidents that lasted less than 30 days cost an average of USD$11.23 million.

Financial services and professional services have the highest average activity costs. The average activity cost for financial services is USD$21.25 million and professional services is USD$18.65 million. Service organisations represent a wide range of companies including accounting, consultancy, and professional service firms.
 
Organisational size affects the cost per incident. The cost of incidents varies according to organisational size. Large organisations with a headcount of more than 75,000 spent an average of USD$22.68 million over the past year to resolve insider-related incidents. To deal with the consequences of an insider incident, smaller-sized organisations with a headcount below 500 spent an average of USD$8.13 million.
 
North American companies are spending more than the average cost on activities that deal with insider threats. The total average cost of activities to resolve insider threats over a 12-month period is USD$15.4 million. Companies in North America experienced the highest total cost at USD$17.53 million. European companies had the next highest cost at USD$15.44 million.

Five signs that your organisation is at risk:

Employees are not trained to fully understand and apply laws, mandates, or regulatory requirements related to their work and that affect the organisation's security.
Employees are unaware of the steps they should take to ensure that the devices they use—both company issued and BYOD—are secured at all times.
Employees are sending highly confidential data to an unsecured location in the cloud, exposing the organisation to risk.
Employees break your organisation's security policies to simplify tasks.
Employees expose your organisation to risk if they do not keep devices and services patched and upgraded to the latest versions.

Dr. Larry Ponemon, chairman and founder of the Ponemon Institute, says insider threats continue to climb, both in frequency and remediation cost.

"That said, we are seeing the risk of malicious insider threats increase – with more users accessing business data from outside the confines of the office," he says.

"This can blur the security team's ability to identify and differentiate between well-meaning employees, and malicious insiders trying to siphon sensitive business data.