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Electronic theft by foreign and industrial spies and disgruntled
employees is costing U.S. companies billions and eroding their
international competitive advantage. That was the message delivered by
government and private security experts at an all-day conference on
corporate electronic espionage. "Hostile and even friendly nations
routinely steal information from U.S. companies and share it with their
own companies," said Noel D. Matchett, a former staffer at the federal
National Security Agency and now president of Information Security Inc.,
Silver Spring, Md. It "may well be" that theft of business data is "as
serious a strategic threat to national security" as it is a threat to
the survival of victimized U.S. firms, said Michelle Van Cleave, the
White House's assistant director for National Security Affairs.
The conference was jointly sponsored by the New York Institute of
Technology School of Management and the Armed Forces Communications and
Electronics Association, a joint industry-government trade group. Any
secret can be pirated, the experts said, if it is transmitted over the
air. Even rank amateurs can do it if they spend a few thousand dollars
for a commercially available microwave receiver with amplifier and a VCR
recorder. They need only position themselves near a company's satellite
dish and wait. "You can have a dozen competitors stealing your secrets
at the same time," Mr. Matchett said, adding : "It's a pretty good bet
they won't get caught." The only way to catch an electronic thief, he
said, is to set him up with erroneous information.
Even though electronic espionage may cost U.S. firms billions of
dollars a year, most aren't yet taking precautions, the experts said. By
contrast, European firms will spend $150 million this year on electronic
security, and are expected to spend $1 billion by 1992. Already many
foreign firms, especially banks, have their own cryptographers,
conference speakers reported. Still, encrypting corporate communications
is only a partial remedy.
One expert, whose job is so politically sensitive that he spoke on
condition that he wouldn't be named or quoted, said the expected influx
of East European refugees over the next few years will greatly increase
the chances of computer-maintenance workers, for example, doubling as
foreign spies. Moreover, he said, technology now exists for stealing
corporate secrets after they've been "erased" from a computer's memory.
He said that Oliver North of Iran-Contra notoriety thought he had erased
his computer but that the information was later retrieved for
congressional committees to read. No personal computer, not even the one
on a chief executive's desk, is safe, this speaker noted.
W. Mark Goode, president of Micronyx Inc., a Richardson, Texas, firm
that makes computer-security products, provided a new definition for
Mikhail Gorbachev's campaign for greater openness, known commonly as
glasnost. Under Mr. Gorbachev, Mr. Goode said, the Soviets are openly
stealing Western corporate communications. He cited the case of a Swiss
oil trader who recently put out bids via telex for an oil tanker to pick
up a cargo of crude in the Middle East. Among the responses the Swiss
trader got was one from the Soviet national shipping company, which
hadn't been invited to submit a bid. The Soviets' eavesdropping paid
off, however, because they got the contract.