Industrial or Economic Espionage

Industrial or Economic Espionage

A small Mississauga electronics safety equipment company is broken into.

Although filing cabinets and desks were rummaged through, nothing was seemingly

taken. An officer discovered the company had drawn up a bid for $7 million

dollar contract a day or so before the break-in. The contract in question was

for a foreign country. It was later discovered that the company in question was

known for its aggressive economic espionage. An iron ore shipping company was

also broken into. At first it was thought that the target had been the firms

computers. But, nothing was taken, it was assumed that the burglars had been

scared off. Within thirty minutes it was discovered that the company was

approaching its fiscal year end. staff eventually found that most of the recent

database backup tape was missing. A Quebec based company with the laser-based

system for inspecting materials used in, among other things, the stealth

aircraft, had three computers stolen. On their harddrives were confidential

codes for specialized software used by the Canadian Armed forces. The above are

all true examples of the modern threat facing international business today

known as industrial or economic espionage. The end of the cold and economic

pressures have increased the risk of economic espionage. The collapse of the

Soviet Union has left unemployed KGB and other former communist bloc

intelligence agents selling everything from Russian night vision devices to

completely assembled and functional bugging devices. Even friendly western

European governments have been caught spying on private corporations based in

the U.S. and other countries, while industrial competitors sometimes hire

private companies to collect competitive intelligence from their corporate

rivals( Lester:96). What exactly is economic espionage? how prevalent is it?

Who does it? How do they do it? and what can we do to stop it. These are the

questions that will be looked at in the following pages.

First lets look at, what exactly is economic espionage. Espionage and

intelligence is no longer the exclusive domain of monarchs and governments, it

has become a must for modern international business. Large corporations around

the world particularly in western Europe and Asia now hire agents to gather

intelligence on their competitors and other countries. The goal of economic

espionage is to steal trade secrets, plans and confidential procedures or

anything to give your company or country a competitive edge over another

(Perry:1996). The areas that interest industrial spies the most include

radiation transfer technology, systems diagnostic and testing software,

traveling wave tubes, aviation technologies, microwave monolithic integrated

circuits, inferred signature measures software, radar technologies, wet