IP thefts to plague Asia

Employees stealing and leaking corporate data spiked in 2012, and detection of such thefts will only become more difficult in the region as stricter data laws are introduced and companies move to SSDs for storage.

SINGAPORE--Intellectual property (IP) theft is a big concern this year among companies, with many instances of employees stealing corporate data. The detection of such thefts will become more difficult in Asia going forward, as companies move toward solid-state drives (SSDs) and more data protection regulations are introduced.

Speaking during a briefing here Thursday, Denny Husen, director of investigations and disputes at Kroll Advisory Solutions, said there have been many cases of employees leaving a company and bringing confidential information with them to rival firms in 2012. Kroll Advisory Solutions is the investigative services and risk management arm of data recovery company Kroll Ontrack.

The executive said he had been contacted on a daily basis this year to conduct investigations on cases which involved stolen IP from corporate databases, or sensitive information that was leaked to rival firms.

One example of such corporate espionage was when 11 Samsung employees stole and leaked confidential information regarding the South Korean company's organic light-emitting diode (OLED) patents, which they subsequently leaked to rival LG Electronics.

Game developer Zynga was another embroiled in a stolen IP case, when it filed a lawsuit in October against former employee Alan Patmore. The company alleged that Patmore copied 760 files containing information on its monetization plan, unreleased game design documents, and other trade secrets to his Dropbox online storage account.

Husen noted that companies tend not to restrict access to confidential information stored on cloud services to boost greater work efficiency, but this in turn makes the risk of theft by employees higher.

Companies today also do not restrict access to confidential information on data storage technology such as the cloud, for greater work efficiency, which make the risk of insider threat higher , he added.

SSDs, regulations pose more challenges
The executive believed IP theft will be even more difficult to detect in Asia going forward, considering how more companies in developed markets such as Singapore, Japan, South Korea, Australia, and New Zealand, are now using SSDs to store their information.

Elaborating, Husen said most employees tend to erase their digital tracks after stealing information by deleting the stolen data, and with conventional hard-disk drives, these tracks are easier to be discovered.

SSDs, on the other hand, are based on flash memory which has properties that affect data forensic efforts. For one, flash memory is not partitioned off in blocks, as with tape drives, but in pages which has a limited read/write capacity. Once the ceiling is reached, the digital track ends on what data had been stolen, he explained.

Furthermore, the encryption on flash memory drives can be manipulated such that an employee can replace the controller's encryption key with a new one that would not be able to unlock the previous encryption of the files that were stolen, the executive added.

Besides the challenge SSD poses to data forensics and IP theft, there are also more countries in the region introducing data privacy laws that could impact how stolen information can be detected, he noted.

China, for example, has a "crazy" data protection law which dictates that no corporate data can be taken out of China, Husen said. So, if a company chooses to investigate an employee's laptop in China, they would not be able to do it remotely but have to fly investigators into the country--which would be more costly and inconvenient, he added.

In the end, the executive advised companies to put more effort in actively training and educating employees on how to handle sensitive information, as well as limit the types of information workers are able to accces.

"Intellectual property theft is a human error which [companies] cannot eradicate but can control," Husen said.