Security breaches cost SMEs $600 million – here’s how to avoid them

Small businesses lost over $600 million due to security breaches in 2007, according to a new report from the Australian Institute of Criminology.

The Australian Business Assessment of Computer User Security report, which questioned about 4000 businesses, recorded that 13% of small businesses, 20% of medium businesses and 30% of large businesses have been hit by security problems.

Nearly 9% of businesses have had physical hardware assets stolen, such as laptops and mobile handsets, while 44% said they have suffered from spyware, including programs that log keystrokes to steal passwords and other sensitive data.

The study also shows that the businesses experiencing the most security breaches are in the administration and support services area, at 21%, followed by rental, hiring and real estate services at 19%.

The cost of these security breaches was between $595 million to $649 million, with the three most common attacks caused by viruses, spyware and phishing, which use fake websites to gather information.

Kelly Richards, research analyst at the Australian Institute of Criminology who authored the report, says that while 85% of businesses had security strategies in place, a large number remain ignorant of how to deal with digital attacks.

“Although 85% sounds quite high, it’s quite frightening really that 15% of businesses didn’t have anything in place,” she says, adding that basic security features are necessary for any business.

“Basic things such as antivirus software, firewalls would be a good start. Looking at this study from a broader level, this study shows there’s a lack of education and lack of literacy among small businesses, and that’s one area that’s crucial to improve.”

Richards says that the AIC received the impression that businesses were unsure of what to do regarding cyber-security, and that there should be more communication between businesses and government about what products are available.

“It was quite frustrating, even though there are government initiatives to help businesses, almost 80% of our respondents had never found any of these [initiatives]. The communication between business and government needs to be opened.”