Intellectual property theft, or IP theft, is described by the FBI as “robbing people or companies of their ideas, inventions, and creative expressions.” IP theft includes “everything from trade secrets and proprietary products and parts to movies, music, and software.”

Reports suggests annual losses from international IP theft equal an est. $300 billion. Thus, the health of impacted economies suffer greatly. Millions of jobs are never established and incentive for growth diminishes.

IP theft is a serious crime. The National Intellectual Property Rights Coordination Center (NIPRCC) was developed in 2000 as a comprehensive federal effort to address it. The NIPRCC conducts assessments and prosecution of IP-related crimes. They also work to remove cross-agency redundancies, inefficiencies and information barriers.

However, even with a federal effort in play, corporate espionage and IP theft is still a tremendous threat.

IP theft vulnerabilities

Before learning how to protect your business from IP theft, you must first understand the common risks and vulnerabilities.

All organizations, regardless of size or industry, are susceptible to theft of IP. Even The Gillette Company, a multi-billion-dollar entity owned by Proctor & Gamble, has a history of being the victim of IP theft.

Photo: © GaudiLab, YFS Magazine

In 2015, former Gillette employees allegedly disclosed trade secrets to competitors. The following year, an est. $200k worth of stolen razors were sold on the black market.

IP theft also affects smaller businesses and often results in a larger post-theft impact given a lack of resources. Midwest Rubber Service and Supply, the manufacturer of squeegees for floor scrubbing machines, saw their sales plummet after counterfeit squeegees hit the market. Consequently, the squeegee manufacture responded by reducing prices by over 50%. How many businesses can survive after a 50% price reduction of their top producing product or service?

Greed and the desire to succeed at all cost is a primary driver of IP theft. Coupled with technological advances, it’s simply easier for competitors to conduct corporate espionage and steal IP. Recognizing the threat is the a vital step when it comes to protecting yourself.

Protecting your business from IP theft

IP theft can occur via several methods including: cyber-attacks, physical robberies or through the extortion or bribing of current and even former personnel. Fortunately, there are ways businesses can mitigate these risks and vulnerabilities.

Identifying cybersecurity weaknesses through active technology scanning and assessing phishing capabilities is a key first step.

Secondly, it’s important for business owners to deploy proper security elements including, but not limited to, office cameras, limited access, and floor layout and design that promotes safety and internal transparency.

Lastly, increasing employee awareness of IP theft through training and access to  information will make your business harder to target.

Photo: © deineka, YFS Magazine

Businesses should also inventory their IP, according to STOPfakes.gov. “Examine your business to see what might be eligible for a patent, trademark, copyright or trade secret status.” Use their free course, an Online IPR Training Module to get started.

The hard truth about IP theft

The reality is that many small businesses do not protect their intellectual property. For example, “only 15% of US small businesses conducting business overseas were aware that US patents don’t protect them abroad.”

Meanwhile some business owners aren’t clear on the range of IP protection that is available, how it applies to their business and when to secure it. As Traklight explains,”… you may file for any or all of patents, copyrights, trademarks, and also use trade secret protection for a particular product. Make sure you have chosen and file for the appropriate protection prior to commercializing your idea.”

Small businesses often lack the expertise to defend themselves, while large organizations are exposed on numerous fronts as well. We live in complex society where technological advances have increased the threat and ease of IP theft.

Does your business have the policies, procedures, and personnel emplace to withstand the impact of IP theft and overall security breaches? If not, it’s time to consider what’s at risk and safeguard your intellectual property and assets.

This article has been edited.

Jason Polanco is the Managing Director of Security Precision Group, LLC specializing in vulnerability and risk assessments and security consulting. He has used his skills and experience to train multiple security teams, the drug enforcement agency, foreign military units and police departments. He has also served on active duty in the United States Marine Corps for over 16 years.