Saturday, October 1, 2011

Pentagon seeks probe of the cost of hacking

The Pentagon is asking the nation’s 16 spy agencies to investigate the cost of theft of commercial secrets by foreign computer hackers, a loss some analysts say could be costing the U.S. economy hundreds of billions of dollars a year.

“We expect it is very substantial — substantial in monetary terms, substantial in security terms,” said James N. Miller, principal deputy undersecretary of defense for policy. “The nation has a substantial interest in protecting intellectual property.”

The Pentagon’s request for an estimate went to the National Intelligence Council, which produces National Intelligence Estimates (NIEs), said Deputy Secretary of Defense William J. Lynn, adding that its report will likely be classified when the assessment is complete.

Security specialists say that hackers, many thought to be operating on behalf of communist China, are stealing vast quantities of proprietary data from U.S. defense, energy and other firms every year, compromising the nation’s security and economic advantage.

“It is a massive transfer of wealth,” said Phyllis Schneck, chief technology officer for public-sector business at computer security firm McAfee Inc.“Things that would have created money and jobs for one company in one country are instead creating them for other companies in another country.”


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