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Outsourcing jobs a security risk: US intelligence
Indian Express Newspapers (Bombay) Ltd ^ | March 20, 2004

Posted on 03/20/2004 4:06:30 AM PST by sarcasm

Washington, March 20:With as many as three million software industry jobs poised to move offshore by 2015, the US industry needs to protect itself against potential security risks, including economic espionage, the chairman of the National Intelligence Council has warned.

“While outsourcing of business functions is a growing trend that helps firms cut costs, it also brings potential security risks--particularly when outsourcing involves entities owned and operated abroad,” Robert L. Hitchings, Chairman of the council, which is the US intelligence community's think tank said while addressing the international security management association in Scottsdale.

He said besides outsourcing, writing computer codes aboard and importing hardware entails security risks. “As many as 3 million software industry jobs could move offshore by 2015, with 70 per cent of these jobs moving to India, 20 per cent to the Philippines and 10 per cent to China,” he said. Warning that corporate leaders need to be on guard.

“Corporate leaders need to be on guard and know who their business partners are and what security measures they have in place to protect against loss, whether through unintended leakage of proprietary business information, deliberate thefts of intellectual property, or outright economic espionage," Hitchings said.

While technology now allows companies to have their most sensitive proprietary computer code written overseas, he said the inability of companies to sufficiently vet the personnel involved in these activities can create a “significant vulnerability.”

US openness to foreign trade and investment and its commitment to global information sharing through academic and scientific exchange, Hitchings said unfortunately leave US technologies highly exposed to foreign exploitation. Pointing out that collectors last year employed a wide variety of techniques in their quest to circumvent US restrictions in the acquisition of sensitive manufacturing processes, he said foreigners often through middlemen acquired sensitive US technologies simply by requesting them via e-mail, faxes or telephones.

Globally networked information systems, he said, also present vulnerabilities, and even the simplest computer threats pose real risks for US companies’ business interests and proprietary knowledge.

Information technology, said Hutchings, has become as important to the US economy as oil, and the growing dependency of the US on foreign it "raises concerns for corporate as well as national security." for instance, he said, half of the world's laptops, one quarter of desktop computers, and half of all PC motherboards are now assembled in China. Taiwan is now responsible for about 70 per cent of all semiconductor production for hire--producing chips designed and marketed by others.”

This growing US dependence, said Hutchings, makes US IT firms vulnerable to interruptions of foreign-built critical components, whether intentional or accidental. “Foreign supply disruptions could suspend US firms' deliveries of finished systems within only a few days, as most carry limited inventories.”


TOPICS: News/Current Events
KEYWORDS: nationalsecurity; outsourcing
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To: DustyMoment
"The only thing that can stop John Kerry from winning the Democratic nomination now is an endorsement from Al Gore."

"In addition, Gore has already endorsed Kerry. The Gore-ons just haven't gotten that message, yet."

My comment was made facetiously. I guess I should have made that clearer.
61 posted on 03/20/2004 5:48:47 PM PST by phil_will1
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To: A. Pole
the executives could care less. Does anyone really think Carly Fiorina gives a damn about something like this while flying to lunch on one of the HP Gulfstreams?

they will be long gone with boatloads of money when problems like this hit the fan.
62 posted on 03/20/2004 6:11:12 PM PST by oceanview
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To: phil_will1
My bad. I'm having an off night.
63 posted on 03/20/2004 6:17:23 PM PST by DustyMoment (Repeal CFR NOW!!)
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To: CompProgrammer
I see you are new here. I suspect you are young. Let me give you a tip about FR. Rank liberal trolls are kicked off immediately, but free-"traitor" type LIBertarians who have no sense of history, nationalism nor patriotism are allowed to stay, and can take control of an economics discussion. My advice is: think patriotism, nationalism and national security. Especially national security is MORE IMPORTANT than stuffing the pockets of some of the LIBertarian / globalist $hitheads hanging around here masquerading as conservatives. Don't waste your time debating with them because they are small-minded idiots who either are or foolishly identify with globalist corporate managements.
64 posted on 03/20/2004 7:29:49 PM PST by old-ager
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To: 1rudeboy
Actually, yes I am. My reading of the regulation is that the Business Associate must comply with the regulation..

Your missing a rather large chunk of the problem: under HIPAA there are no enforcement provisions against the BA, and if you dig into this issue a bit more you'll also find there are few actual penalities that would in practice be levied against the CE for BA violations.

If you do some research, you'll find that this is exactly the interpretation of HIPAA consultancies and attorneys.

65 posted on 03/21/2004 5:59:29 AM PST by angkor
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To: sarcasm
Just remember all this outsourcing was started by your Governmnet for less Government. They outsourced Government jobs to private industry, Yea! You say; I say nay. It fueles companioes that get the contract for one year, then go belly up and the next entity (same principals) take over and the With held taxes, including Social Security go down the tube.

Then the Gov't wanted to ioutsource the programming of IRS computersa - the bidder - the PENTAGON! Adios privacy, but that was stopped.

So now we gp offshore where there is no privacy, no financial protection, no taxes to the US, no Social Security and NO AMERICAN jobs....of course you can compete with the Illegals and be hired by a Corp. that pays substandard wages and disappears along with the illegals when "ICE" shows up.

Yes we need MORE REPUBLICANS and DEMOCRATS - NOT! Time to keep turning over the politicians getting rid of all incubants as frequently as possible. It will disrupt their Un American activities and they want to steal from us - so they will straighten out if we keep em churned.

66 posted on 03/21/2004 6:40:10 AM PST by Henchman (I Hench, therefore I am!)
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To: A. Pole
>I am sure Chinese and Indian governments can do security clearances if asked.

Exactly which foreign gov't do you work for?

67 posted on 03/21/2004 10:41:33 PM PST by Dialup Llama
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To: Dialup Llama
Exactly which foreign gov't do you work for?

Unfortunately for none. Neither foreign or domestic. I did not pay attention when they told me "go for the government job, young man". :(

68 posted on 03/22/2004 4:57:44 AM PST by A. Pole (<SARCASM> The genocide of Albanians was stopped in its tracks before it began.</S>)
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To: sarcasm
i see a potential link here:

http://www.freerepublic.com/focus/f-news/1102839/posts
69 posted on 03/22/2004 7:16:38 AM PST by techwench (let's see, format c: /u should fix it)
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To: A. Pole; GatekeeperBookman; Willie Green; Wolfie; ex-snook; Cacophonous; Jhoffa_; FITZ; ...
Security over private information?

I am sure these honest governments, companies and individuals will be most trustworthy with such critical information.
70 posted on 03/23/2004 8:45:12 PM PST by Jerr (What would Ronald Reagan do? There they go AGAIN!......)
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