Risk Identification in Information Security
How does risk identification contribute to effective risk management of information security?
Risk identification plays an essential part in the process of risk management and in dealing with the pressing issue of information security in the modern working and networked environment. Risk identification also plays an important role in the selection and prioritization of various problems in terms of their significance to the organization or institution. Furthermore, risk identification leads to an assessment of the value assets of the company or enterprise. It is imperative that an organization properly identifies all possible risks so that the communities of interest within that organization have a clear picture to construct an assessment of the vulnerabilities to these assets.
The present study is intended to research the ways in which risk identification is useful as an integral and essential part of the process of the risk management of information security. I hope that my research question and paper will help further the understanding of the role that risk identification plays in risk management, and that this research can be instrumental in providing some new insight into risk identification.
Overview of risk identification and IT
The issue of security has become an important if not crucial area of concern for all online companies, ecommerce institutions and Web users. The issue of security, as well as privacy, can be seen in the increasing concern about online shopping and customer confidence in the online payment process. The issue of privacy intrusion has also become central to today’s online world, especially in the area of ecommerce. There has in recent years been an increase in the reports of fraud and credit card infringements. This has also resulted in efforts to create and disseminate more effective security measures and methods. All of these aspects have to be taken into account in understanding the problem of risk identification as a necessary prerequisite for good risk management in the information age.
With the advent and increasingly ubiquitous nature of the Internet, online networking and communications technologies, there has on the one hand been an exponential increase in the free flow of information and the growth of online business. The internet as a boon to various industries and commerce has meant not only that information and information sharing have become more accessible and faster, but that various new technologies can be used to increase business and transaction processes. In essence, the Internet has meant that the barriers that existed before between countries and nations, as well as markets, have all but disappeared.
On the other hand this modern phenomenon has also resulted in certain unique and challenging problems and risks to both commercial and private integrity that has become of paramount importance in the modern organization and business. As the internet has progressed in complexity and interactivity, as well as in the exponential increase in the number of online users, so have the threats of privacy invasion and other forms of intrusion and fraud.
The Internet has grown considerably during the past decade, particularly with respect to its use as a tool for communication, entertainment, and marketplace exchange. This rapid growth has been accompanied, however, by concerns regarding the collection and dissemination of consumer information by marketers who participate in online retailing. These concerns pertain to the privacy and security of accumulated consumer data & #8230;and the perceived risks that consumers may experience with respect to these issues
(Miyazaki, and Fernandez, 2001, p. 27)
Risk identification as well as risk assessment is therefore seen as a cardinal issue in today’s IT and online environment. As one article on this subject states, “Operational IT planning should identify and assess risk exposure to ensure policies, procedures, and controls remain effective” (Booklet: Management ). Furthermore, it is generally stressed that this risk identification should be thorough and extensive. It should”… identify the location of all confidential customers and corporate information, any foreseeable internal and external threats to the information, the likelihood of the threats, and the sufficiency of policies and procedures to mitigate the threats” (Booklet: Management). As many IT specialists note, it is imperative that management consider the results of the identification and assessment of risks in overseeing all IT operations.
The above points therefore stress the central role that the identification of risk factors play in the security of the company or firm involved. As many experts comment, the reality of modern online and networking interactions and communications in business and other organizational activities is that any system is vulnerable to hacking and other security issues. It should also be noted that the general consensus is that the majority of security breaches occur as a result of common vulnerabilities in the system that could easily have been checked.
However, the identification of risk factors in terms of information security brings a large number of variables and criteria into play. These include not only issues of policy and procedure, but also human factors and issues such as training and human error that have to be taken into account in the assessment of risk.
Before discussing the aspect of risk identification in detail and in relation to factors such as risk assessment and management, it is firstly important to clearly define the parameters of the term risk identification. The CISA Review Manual 2006 provides the following definition of risk management:
Risk management is the process of identifying vulnerabilities and threats to the information resources used by an organization in achieving business objectives, and deciding what countermeasures, if any, to take in reducing risk to an acceptable level, based on the value of the information resource to the organization.” (
A number of important aspects need to be identified and unpacked from this definition. The first is that risk identification is on ongoing process which must be continuously repeated and maintained, as the online information environment is constantly changing with many new threats and risks emerging on a daily basis. Therefore, the process of identification must be one that is designed to be maintained over time and should also be flexible enough to adapt to new threats or risks in the online environment.
A second important point is that the measures or counter-measures taken as a result of identification and assessment of risks must be balanced in order to ensure that these measures taken do not impact negatively on aspects such as efficiency and productivity. In other words, risk identification is related to value assessment and counter — measures instituted to protect the assets of the company or organization should not jeopardize the integrity of the organization.
In essence risk identification can be understood as The “â€¦ likelihood that something bad will happen that causes harm to an informational asset (or the loss of the asset)” (SPECIAL REPORT: Security Directives and Compliance). Furthermore, this means that the optimal management of security risks implies the correct and timely identification of possible risk factors that may threaten the company. This in turn refers to an ongoing and detailed awareness of the value of the assets of the company or organization. “â€¦ managers need to identify the value of the IT and information assets that might be impacted; then conduct a threat and vulnerability analysis to identify the potential effect and the probability of that occurrence” ( SPECIAL REPORT: Security Directives and Compliance) Therefore, it follows that in order to accomplish adequate risk identification one must take into account the important concept of vulnerability. Vulnerabilities as a central aspect of risk identification will be discussed in more detail in the following section.
Vulnerabilities to the system in information security constitute a risk. These vulnerabilities can mean the loss of integrity and confidentiality and can consequently lead to other losses, such as loss of income. However, the identification of all risks is often an impossible task and the term residual risk is used to describe all remaining risks after the identification and assessment. In this sense, risk assessment follows from the identification of the risk and is usually carried out be a team of experts in the areas of the business affected.
There are many common types of vulnerabilities that need to be acknowledged and included in any strategy of risk identification and management. One of the most pervasive and common risks is identity theft. An article that provides some insightful and relatively contemporary statistics on the extent of ID theft is Internet Commerce Grows 88% by Dollar Volume and 39% by Transaction Volume: Fraud Remains a Concern. For example, the author notes that in recent years the “â€¦. United States remained the top source country for security events generated with an overwhelming 79%, followed by Canada (5.7%), Taiwan (2.6%), Korea (2.5%) and the U.K. (2.4%)” (Internet Commerce Grows 88% by Dollar Volume and 39% by Transaction Volume: Fraud Remains a Concern). Another source that attests to the serious extent of this risk is FraudWatch International (http://www.fraudwatchinternational.com). The identify Theft section to this site is constantly updated with some of the latest information and data and provides a wealth of information on ID theft practices such a phishing as well as possible solutions to these problems.
Phishing Spear Phishing and Pharming
The following is intended to provide a very brief overview of examples of some the most dangerous and pervasive security risks in the online and networked world. One of the most insidious of identity theft is known as phishing. The term ‘phishing’ refers to the practice of “fishing for information.” This term was originally used to describe “phishing” for credit card numbers and other sensitive information that can be used by the criminal. Phishing attacks use “â€¦spoofed emails and fraudulent websites to deceive recipients into divulging personal financial data, such as credit card numbers, account usernames and passwords, social security numbers etc.” (All about Phishing) . Thompson ( 2006) clearly outlines the basics of a phishing attack.
A typical phishing sends out millions of fraudulent e-mail messages that appear to come from popular Web sites that most users trust, such as eBay, Citibank, AOL, Microsoft and the FDIC. According to the Federal Trade Commission, about 5% of recipients fall for the scheme and give information away. Phishers wish to irrationally alarm recipients into providing sensitive information without thinking clearly about the repercussions. Victims might be told someone has stolen their PIN and they must click on the provided link to change the number. (Thompson, 2006. p. 43)
Bielski (2005) illustrates the reality of identity theft and techniques of phishing. He refers to this pervasive threat to major American commercial institutions; “â€¦. The Bank of America’s & #8230;loss of government worker data and & #8230; Choicepoint’s “data leaks” (Bielski, 2005, p.7). This study also the discuses the risk of phishing to smaller intermediate companies. (Bielski, 2005, p.7)
There are numerous studies that point to the increasing cost of phishing, not only the individual but also to the commercial institutions that are negatively affected.
Phishing costs victims and financial institutions money and time. Victims must correct credit records and repair other phishing-related damage, while financial institutions must absorb customer losses, as well as costs from issuing new credit cards, answering calls and shutting down fraudulent websites. (Wetzel, 2005, p. 46)
Spear phishing is a relatively new and extremely effective form of phishing. A useful definition of this type of ID fraud is as follows;”Spear phishing is an e-mail spoofing fraud attempt that targets a specific organization, seeking unauthorized access to confidential data. As with the e-mail messages used in regular phishing expeditions, spear phishing messages appear to come from a trusted source” ( Spear Phishing). Furthermore, spear phishing attempts are most likely to be conducted by “â€¦sophisticated groups out for financial gain, trade secrets or military information.” spear phishing” ( Spear Phishing).
In essence the difference between spear phishing and ordinary phishing is that the former is more directed and does not contact hundreds or thousands of potential victims but focuses on a single company or enterprise. The central problem with this form of identity theft is that it appears to be genuine in that the request to provide information comes from known and trusted sources within company, enterprise or institution. The central factor in this form of phishing is that the phishing e-mails appear to be sent from organizations or individuals that the potential victim recognizes and from whom he or she would normally receive email. This makes it as very deceptive type of identity theft and one that is often very difficult to combat.
Another disconcerting aspect of this form of spear phishing is that it can also be used to trick the victim into downloading malicious codes or malware. This can take place easily if the recipient clicks on the false web site and is unknowingly led to a site that automatically downloads the malware or spyware. This software can hijack or take over the user’s computer and gain access to personal files and information, often with devastating consequences for the individual.
Pharming is another form of common identity theft which refers to the redirection of legitimate Web sites to false online addresses. Pundits claim that pharming can even foil experienced computer users and could become one of the most insidious privacy and security threats yet. Experts claim that pharming attacks are on the increase.
Pharming works in the following manner: when a user correctly enters a web address to access online information about his bank and credit cards, chances are the web site that appears may be a sham and operated by scammers. The user assumes that the site on which he or she is entering the data is authentic, as it is a perfect replica of the legitimate site. The user then enters his or her credit card details or other sensitive information, with obvious consequences.
The process of risk identification
Risk identification is a step in a process which includes asset identification and vulnerability assessments. In the light of the type of threats to information security discussed above, it is obvious that the process of security management would not be possible or effective without the clear identification of the risks posed and the way that these risks effect the particular assets of the company to institution. As one commentary notes;
Asset identification is the first step towards a secure organization. Too many companies are too eager to implement the most expensive technology with strong encryption and state-of-the-art authentication systems, without first thoroughly identifying all their assets. (Security+ TechNotes – Risk Identification)
In other words, the link between risk identification and asset identification is that the company should be very clear about the assets that are at risk in order to implement the most effective counter-measures and security strategies to combat these risks. Risk identification is therefore to a large extent dependent on the evaluation of assets. For example, â€¦a company implements a firewall for their 2 Mbps shared Internet connection, but disregards the backup dial-up connection some distinguished employees have in their office. Also laptops including removable media from remote users, such as frequently traveling sales personnel, are too often ‘forgotten’ when a formal asset identification is not performed prior to developing the company’s security program. (Security+ TechNotes – Risk Identification)
Once the assets are identified, a vulnerability assessment usually follows to determine the most vulnerable areas of security concern. This in turn leads to a threat assessment and to a risk identification. Following the logic of this process, risk identification refers to”â€¦the likeliness of a threat actually leading to an incident” (Security+ TechNotes – Risk Identification).
Risk Identification and its importance
As Frame ( 2003) states, “Risk identification is the first step in the risk assessment process: “Its purpose is to surface risk events as early as possible, thereby reducing or eliminating surprises” (p. 49). The importance of risk identification in the process of security management is mainly to develop a sense of the sources of the security problems and issues. Once the possible impact or effect of the risk to the assets of the company has been established then, “â€¦ the risk analysts, working with managers and employees in the enterprise, engage in risk response planning to develop strategies” (Frame, 2003, p. 49). In essence, the important aim and rationale of risk identification is “â€¦to avoid surprises” (Frame, 2003, p. 49).
The importance of the risk identification phase in security management is reiterated in a number of studies. Prybylski, (2008) state that;” Effective risk management is dependent on identification. Many risk stakeholders say, ‘It’s not the risks that I know about that concern me; it’s the ones that we have not identified’ ” (Prybylski, 2008, p. 56).
The importance of the identification process is also underlined by modern concerns that this process should be ‘rethought” and improved in the light of the continuing and developing threat to informstion security.
Institutions must reinvent the process of risk identification. They must eliminate “groupthink” situations in which viewpoints that differ from the majority are dismissed without adequate analysis and be mindful of unfocused debates that can skew the view of risk and create additional, unintended risk exposures. (Prybylski, 2008, p. 56)
The Human Element and Other Problematic Areas
Among the criteria that relates to the topic of risk, certain studies have stressed is the human element as being important in risk identification sand assessment. As Lineberry ( 2007) states: “Few companies properly address the human element of information security ” ( p. 44 ) A security consultant, Debra Murphy, also notes that the human element in the identification of risk is often of cardinal importance. “There are times when the human element is the leaky faucet” that spills sensitive informationâ€¦” (Lineberry, 2007, p. 44).
This also relates to the importance of the e-training gap. E-training refers to the training within the organization that enables staff to identity and deal with possible risks and security threats. As one study on this aspect notes, there is generally a lack of this type of training and that this is a possible internal risk factor that should be taken into account (Lineberry, 2007, p. 45). This applies particularly to risks such as scams and various forms of phishing those results in staff giving out information that may be a security risk. It also applies especially to staff who deal with the public and who are exposed to customer demands. They can easily be taken in by some scam if they do not have the requisite training; for example; “Social engineering scam artists, who use deceptive and manipulative tactics on individuals to gain unauthorized access to information, pounce on that customer-focused mandate” (Lineberry, 2007, p.44).
This issue is an important point of contention in modern analyses of identification risks in the organization. The concern is that too much attention has been given to the technical side of risk identification and that the personal human aspects of risk have to a large extent been ignored. There is according to some expert a “disconnect” between the issue of human error and the more technological aspects of risk identification. ” That disconnect, combined with discomfort relating to personal privacy issues, is among the chief reasons that a large percentage of organizations do a poor job managing the human element of information security. “(Lineberry, 2007. P.44)
This important aspect is also discussed by Landoll ( 2005). Landoll in his study entitled Does IT Security Myth the Point? Information Security Programs Often Fail Because They Are Based on Myths and Misconceptions, states that
Technology controls are only part of the solution. Information security, like other aspects of security within the organization, can only be as strong as the weakest protection mechanism. Thus, physical and administrative controls must also be in place. These controls include the identification and protection of critical information assets, the establishment and enforcement of information security policies, and the development and delivery of information security awareness training. An information security program based solely on IT solutions cannot achieve its objective. (Landoll, 2005, p. 110)
Lineberry also notes that “Many critical controls that support information security are non-technical. Observing non-technical controls may reveal much about the strength of an organization’s information security” (Lineberry, 2007. P.44). Therefore, the security management policy in any intermediate or large organization should consider the human element as part of the risk identification process. As Lineberry emphasizes;
To foster a culture that is information security aware, company managementâ€¦ should begin by asking the following questions:
* Are employees educated and aware of common information security threats?
* Do they write down or freely share passwords with others?
* Do visitors freely move about facilities without facing barriers to entry, such as a requirement to wear a company-issued badge?
* Is it common to see sensitive information, such as completed employment applications or client documents containing Social Security numbers, accessible in unmonitored or otherwise unsecured areas?
* What is the prevailing employee attitude regarding information security controls? Are enforced information controls viewed primarily as a nuisance or a necessity? (Lineberry, 2007. P.45)
Other areas of concern in the estimation of risk as an integral part of security management include, amongst others, the following issues: the problem of overestimation or underestimation of vulnerabilities and threats as well as complacency and a failure to see the security threat in a connected and holistic way (Minsky).
A common realization in the literature on this topic is that not enough has been done to ensure risk identification and defense in the contemporary information environment. Among the suggestions that have been put forward about improving risk management, the following tend to dominate. The elimination of “groupthink” or exclusive or selective thinking from the risk identification process and the encouragement to include all viewpoints on this issue ( Prybylski, 2008. P.56 ). Prybylski ( 2008) also suggests that security managers should, “Implement multiple views of risk for increased transparency” ( Prybylski, 2008. P.56 ).
Prybylski goes on to clarify this important stance.
Every institution must find better ways to communicate risk across business units. Transparency of risk is a fundamental element of all successful risk programs, but many organizations lost sight of this factor during the run-up to today’s credit crisis. By siloing risk within a series of complex risk measurement models, organizations may have created a false sense of precision around risk measures. (Prybylski, 2008. P.56).
In conclusion, the above overview of the place and function of frisk identification in the security management process emphasizes a number of salient points. The first is that risk identification plays a vital role in the security process in a number of ways. Risk identification is in the first instance an essential factor in determining the types of security threats that face a particular organization. However risk identification is also related to the analysis and assesment of value. In other words, these two aspects go together in the assessment of vulnerabilities and are intimately linked to the overall management of risk in the information environment.
What is also clear from the above discussion is that as modern technology advances so the risk and threats become more sophisticated and insidious. Consequently there is a call for a more holistic approach to this issue that will go beyond purely technical considerations and which will possibly include aspects such as more advanced training of personnel.
All about Phishing. (2006) retrieved from http://www.bcasonline.org/articles/artin.asp?649.
This article provides a fairly comprehensive overview of phishing. It covers the main points of this type of security threat and also provides insight into methods of identification as a prerequisite to dealing with the problem. The consumer advice section on how to avoid phishing scams is especially useful in terms of the theme of risk identification.
Bielski, Lauren (2006) Debit’s Growing Popularity. ABA Banking Journal 98 (1).
This article was particularly useful with regard to ascertaining the effects of identity theft and fraud on the corporate and banking security. The article explores the extensive impact of identity theft and fraud on these sectors and the present alarming statistics. “Looked at as a group these incidents suggest a security flame-out and the perception that electronic information housed in computers is vulnerable. They also suggest that fraud seems to be mutating at a rateâ€¦” (Bielski, 2006). This adds impetus to the need for risk identification.
Booklet: Management. Retrieved from http://www.ffiec.gov/ffiecinfobase/booklets/mang/07.html
This online article provided s clear and succinct summary of some of the main aspects that should be considered in risk management. The information is presented in point from and provides as useful starting point for the exploration of this topic.
Frame, J.D. (2003). Managing Risk in Organizations: A Guide for Managers. San Francisco: Jossey-Bass. Retrieved from Questia database: http://www.questia.com/PM.qst?a=o&d=108854049
This work deals with general overview of risk in larger organizations from the perspective of security management. The book focuses on a variety of tools and techniques that are being employed increasingly by organizations intent on managing the risks they encounter. These tools come from a number of different disciplines, including finance, statistics, operations research, quality management, and project management.
Internet Commerce Grows 88% by Dollar Volume and 39% by Transaction
Volume: Fraud Remains a Concern. ( Press Release). Retrieved from http://www.highbeam.com/doc/1G1-129371856.html
This is a useful report on the state ofr the Internet in terms of fraud and identity theft. This report provided a comprehensive view of the problem. The article deals not only with the extent of identity theft but also focuses on the important aspect of the way that security issues like ID theft are perceived and understood by the general public.
Landoll, D. (2005, January). Does IT Security Myth the Point? Information Security Programs Often Fail Because They Are Based on Myths and Misconceptions. Security Management, 49, 110+.
This is an imports article as it refers to the various myths and misconceptions often undermine the strategy for security identification and assessment. The article is particularly useful in that it explores the role of human fallibility and error in the risk identification process.
Lineberry, S. (2007). The Human Element: The Weakest Link in Information Security. Journal of Accountancy, 204(5), 44+.
This is an important article in that it provides insight into the human element and the need for intensive training in risk identification. The author stresses that lack of security training for individuals in the firm or company is a weak link that is often not recognized in security management.
Minsky S. ( 2006) New Era of Risk Management. Retrieved from http://www.ebizq.net/blogs/chief_risk_officer/2006/06/looking_for_risk_in_all_the_wr.php
This in effect a Blog entry but it provides links to other sites of interest as well as a summary of some of the new trends in risk management. The author suggests a balanced view of risk identification and a warning not to overestimate or undereste the risks that are identified.
Miyazaki, Anthony D., and Ana Fernandez. ( 2001) “Consumer Perceptions of Privacy and Security Risks for Online Shopping.” Journal of Consumer Affairs 35.1 (2001): 27.
The article provides some significant information on this subject area of privacy and security risks as it pertains to online commerce. The authors discuss the issue of online shopping and the way that identity theft has influenced buying perceptions and views. One of the aspects of this article is the clear and concise outline of identity theft and the negative impact that it has on ecommerce.
Prybylski, H. (2008, September). Enhancing Risk Identification. Risk Management, 55. This short article is important in terms of the topic of risk identification in that it suggests a number of measures that can and should be taken by management to increase the effectiveness and inclusiveness of risk identification. The author suggests that the process of risk identification should become more transparent and that it should be distributed over a wider are of expertise in the organization or the company in order to more effective.
Purtell, T. (2007, October). A New View on It Risk. Risk Management, 54, 28+.
This is an informative and well-structured article which focuses on methods of dealing with risk in organizations. As such, this article provides insight into the way that risk identification relates to the other security processes. The author stresses the importance of identification methods and risk identification at an early stage. He also comments on the need to have an open — ended approach to the issues of risk identification, assessment and management.
Security+ TechNotes – Risk Identification. Retreived from http://www.techexams.net/technotes/securityplus/risk_identification.shtml
This article provides a concise but comprehensive overview of the issue of risk identification and its related components in the process of security management. There are also sections dealing with risk assessment as well as asset identification and vulnerability assessments. The article therefore provides some useful insight into the interaction between the different theoretical components.
Spear phishing. Retrieved from http://searchsecurity.techtarget.com/sDefinition/0,,sid14_gci1134829,00.html#
This is short but fairly comprehensive introduction to the threat of spear phishing. The article is plainly written and provides a summary of the main issues surrounding the identification of this risk; as well as the threat that it poses to organizational security.
SPECIAL REPORT: Security Directives and Compliance. Retrieved from http://gcn.com/microsites/security-directives/following-directives.aspx
This short article provides an overview of the directives relating to risk and risk identification. It provides useful background information in terms of the formal requirements of security management. It is also useful in that it references the CISA Review Manual, 2006.
Thompson, S.C. (2006). Phight Phraud: Steps to Protect against Phishing. Journal of Accountancy, 201(2).
This study by Thompson provides some significant aspects that the business owner and customers in online commerce should pay attention to. These include basic but important aspect that should include in e-training; for example, never e-mail personal or financial information or never to respond to requests for personal information in e-mails. This provides useful background to the issue of risk identification and is also related management of this threat.
Wetzel R. ( 2005) Tackling Phishing: It’s a Never-Ending Struggle, but the Anti-Fraud Arsenal Continues to Grow. Business Communications Review, 35, 46+.
This study A sheds light on the implications in term of the costs of identity fraud to financial institutions. The study underscores the severity of the vulnerabilities faced by today’s organizations in the online world. The author refers to the obvious cost to intuitions like banks and also discusses hidden costs that relate to the erosion of customer confidence as a result of ID theft.
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Proceed to pay for the paper so that it can be assigned to one of our expert academic writers. The paper subject is matched with the writer’s area of specialization.
3. Track the progress
You communicate with the writer and know about the progress of the paper. The client can ask the writer for drafts of the paper. The client can upload extra material and include additional instructions from the lecturer. Receive a paper.
4. Download the paper
The paper is sent to your email and uploaded to your personal account. You also get a plagiarism report attached to your paper.
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