Electronic Intellectual Property Theft: How Vulnerable Are You?

By Daniel Hains 

 forensic accounting firm brisbane

The value of confidential intellectual property to any business is extremely high.

Often, business owners are not aware of how vulnerable they are until an instance of electronic theft actually occurs. Implementing simple controls as well as a policy on data use in relation to valuable, sensitive information can be the difference in managing this risk area and preventing data being lost from your business.

Vincents computer forensic experts have practical, in-depth experience and specialise in assisting clients with tracing these types of matters and providing advice on how to protect against theft.

Intellectual property (or “IP”) is a category of property that includes intangible creations of the human intellect, and primarily encompasses copyrights, patents, trademarks and rights such as trade secrets.  Artistic works like music and literature, as well as some discoveries, inventions, words, phrases, symbols, and designs can all be protected as intellectual property.

The intangible nature of intellectual property presents difficulties when compared with traditional property like land or goods.  Unlike traditional property, intellectual property is indivisible – an unlimited number of people can “consume” an intellectual good without it being depleted.

Current trends in methods of theft of IP


Previously email was easy to trace using exchange servers and as such was a major source of data theft. This was until the widespread arrival and use of USB disks. However, it is now becoming prevalent again due to use of webmail.

Personal Data Storage

Personal data storage is perhaps the most prevalent method by which businesses experience data leakage and theft. Businesses have lost entire client databases to USB disks kept in staff pockets. Although often thought to be difficult to detect, in fact, forensic analysis reveals traces left in the computer registry, such as; link files, disk history, serial numbers and dates which all assist with tracing theft.

Cloud Sharing Apps

Cloud / data sharing apps have now been readily accessible for quite some time.  These apps are characterized by their ease of use and difficulty in blocking and tracing. Forensic analysis identifies installations on staff workstations, often with traces of recently shared files. However, data shared across these apps is difficult to comprehensively identify and becomes a ‘genie out of the bottle’ situation/

Protecting Business / Corporate Data

Invest in Prevention

The goal of any data security strategy is Prevention – be aware of what and where your sensitive data is and identify the risks.  What would you lose if those files were lost or shared?

Tracing an occurrence of data theft is difficult and requires expert assistance. Actually retrieving sensitive, stolen data is next to impossible. Too often, I am engaged too late after the fact.

The cliché of Prevention being worth an ounce of cure is entirely applicable here.

Spend time on constructing and enforcing a strong IT data policy that works for your business model and requirements. Educate all employees to make them aware of the policy.  In 99% of cases, the human is the weak link in a computer network. You don’t necessarily have to completely lock down your IT infrastructure, but take steps to manage the risk of data leakage and theft.

Simple controls are often the best:

  • Strong passwords;
  • Restrict access to important data only to those who need it;
  • Place controls on important / sensitive files, such as: making files Read-Only, encrypt data on portable disks and, place restrictions on printing or editing a file.

Completely removing USB disk access or cloud apps is possible, but may make a network difficult to use.  A policy on responsible data use gives you swift recourse in the event of suspected theft.

Invest in Protection

Use application monitoring for sensitive information – especially where a cost / benefit analysis justifies their application. If cloud-sharing apps are preferred, avoid the simple personal-user accounts and instead obtain a professional level licence (often for low monthly cost). These higher-level licences provide superior file tracking, management of users’ permissions and file use logging. Resist “Bring Your Own Device” situations for all employees.  BYOD means once the ex-employee has departed with your sensitive data, you will also lose valuable incriminating evidence that you need to rely upon later. If you suspect an acrimonious departure, secure the staff workstation and phone and have them properly imaged – insurance against future loss.

Consider professional assistance with enforcement

If you think that you have suffered a loss as a result of theft of data or a similar action you should:

  1. Resist the urge to try to investigate yourself – this could alter important evidence and won’t be able to be relied upon later.
  2. Remember the policy and controls that you put in place – any breach may be enough for action against a current / former employee.
  3. Securing ex-employee data (as discussed earlier) can be the difference when action is necessary later on.
  4. Remember it is important to make a decision on enforcement sooner, if possible.

Want to know more?

If you would like to know more about tracing and defending against the theft of electronic intellectual property, please contact Forensic Services Director Dan Hains.

An Important Message

While every effort has been made to provide valuable, useful information in this publication, this firm and any related suppliers or associated companies accept no responsibility or any form of liability from reliance upon or use of its contents.  Any suggestions should be considered carefully within your own particular circumstances, as they are intended as general information only.



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