FBI Economic Espionage Case
A fire in Shanghai led to building regulations requiring specialized glass insulation Rather than buy the technology, a U.S. company was targeted for espionage. It did not involve cyber attacks!
The company was 2 hours from largest city in the Mid West They had innovative designs based on trade secrets & the loss of their design could cost them their business.
Foreign agents approached executive management proposing a Joint Venture. Simultaneously, they approached the Lead Designer via a head hunter. They tried to insert flash drive and download plans and slipped through security and into company facilities at night to take pictures
Foreign agents offered the Lead Designer $200,000 for designs and consulting fees. Job listings trying to lure other employees away started appearing.
In the cyber realm this would be referred to as an APT, or advanced persistent threat.
Could a Fire in Shanghai Threaten Your Company?
Would you know if it occurred and if it posed a threat?
Would Your Organization Survive?
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Luckily, every breach was caught and reported. Would you bet
your companies existence that your employees would be as loyal?
Recent Economic Espionage cases prosecuted by the FBI have shown that no industry, large or small, is immune to the threat. Any company with a proprietary product, process, or idea can be a target; any unprotected trade secret is ripe for the taking by those who wish to illegally obtain innovations to increase their market share at a victim company’s expense.
Would you know if a fire in Shanghai could put your organization at risk of economic espionage?
Do you know if the country you plan to expand into is investing billions in your industry?
Do you know that some nations create procurement policies that favor their innovation over yours?
Do you know that some nations base procurement policies on "their" technical standards?
Do you understand how policy and regulations (soft law) could prevent your product launch?
Odds are your attorneys, no matter how good, do not!
These are the things that Standards Policy focuses on!
Rarely, if ever, has this type of strategic planning been more critical. A new cold war has begun and the key weapon is trade and economics. Cyber espionage and theft are used to support these, and while protecting against cyber intrusions is important, it is not a comprehensive strategy for survival per the FBI case study referenced. Traditional espionage tactics are being used against organizations from external forces, but just as troubling is the rise in foreign nationals, whose loyalties lie with their home nation. Yet due to their employee status they have insider access to their employers sensitive information.
Those companies that don't adapt to this new reality and respond with agility should be planning their exit strategies! We know! We've worked for a multi-national corporation that was attacked by multiple governments, in multiple ways, and have seen the effects these issues can have on business units. They had enough money to work their way through the issues - do you?
Give us a call and let us review your industry or product space. You may be surprised how quickly we can identify areas of significant international risk!