Industrial Espionage: Developing a Counterespionage Program (Hardback) book cover

Industrial Espionage

Developing a Counterespionage Program

By Daniel J. Benny

© 2013 – CRC Press

232 pages | 33 B/W Illus.

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Hardback: 9781466568143
pub: 2013-09-25
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The FBI estimates that billions of U.S. dollars are lost each year to foreign and domestic competitors who deliberately target industrial trade secrets. And, although today’s organizations face unprecedented threats to the security of their proprietary information and assets, most books on industrial espionage fail to supply guidelines for establishing a program to prevent and thwart such threats.

Filling this need, Industrial Espionage: Developing a Counterespionage Program provides complete coverage of how to ensure the protection of company proprietary information and assets, including how to develop an effective corporate counterespionage program. The book presents the insights of a former veteran of the Office of Naval Intelligence.

The book examines the motives behind industrial espionage and illustrates the variety of spy tradecraft utilized. Through the use of real-world case examples, the author provides guidelines to determine the current threat level to your organization’s proprietary assets as well as the physical security countermeasures, policy, and procedures that must be in place to establish an effective counterespionage program.

Outlining the day-to-day aspects of protecting sensitive data and trade secrets in a corporate security setting, this book is suitable for organizations that have proprietary information and assets to protect, businesses that have operations or partner with companies overseas such as China, organizations that work with the federal government on classified projects, security and counterespionage professionals, and university degree programs in Homeland Security and intelligence.


" … takes the security novice and quickly brings them up to speed on what exactly industrial espionage is and how to develop effective counterespionage programs."

General Aviation Security

"The overall visual presentation is professional with photographs by the author throughout. This book is recommended for general readers interested in protecting intellectual property and those with a specific interest in industrial espionage issues."

Security Management

"Benny has covered every angle—guarding against cyber-espionage, being wary when in hotels and travelling abroad, protecting classified information (whether paper records or in digital form) and what locks, filing cabinets, and windows you might want."

—Professional Security

Table of Contents

Industrial Espionage: Motives and Threats of Industrial Espionage Defined

US Espionage Acts of 1917

The US Economic Espionage Act of 1996

Uniform Trade Secrets Act

State Laws Related to Trade Secrets and Espionage

US Intelligence Agencies

Federal Bureau of Investigation (FBI)

Department of Homeland Security Office of Intelligence and Analysis

State Department Intelligence

Treasury Department Office of Intelligence Support

Defense Security Service

Determining the Value of Information

Conditions for Industrial Espionage






Espionage Threat from Foreign Governments

Espionage Threat from Competitors

Espionage Threat from Inside

FBI Warning Signs of Insider Espionage

Espionage Threat from Freelance Industrial Espionage Operatives


Espionage Tradecraft

The Intelligence Cycle

Planning and Direction



Analysis and Production


Categories of Intelligence Collection and Tradecraft

Human Intelligence (HUNINT)

Methods of recruitment

Imagery Intelligence (IMINT)

Open Source Intelligence (OSINT)

Signals Intelligence (SIGINT)

Measure and Signatures (MASINT)

Deception and Pretext Tradecraft


Cyber Espionage

Cyber Industrial Espionage Defined

Cyber Espionage Indicators

Common Cyber Indicators

Phishing and Spear Phishing

Malicious Code

Weak and Default Passwords

Unpatched or Outdated Software Vulnerabilities

Removable Media

Cyber Espionage Tradecraft


Intrusion into the network

Obtain user credentials

Establish a backdoor

Install multiple utilities

Data exfiltration

Maintaining persistence

Use of PowerPoint as Cyber Espionage Tradecraft

Insider Methods

Counter Methods

Internet-Based Social Networking Espionage

Advanced Persistent Threats

Cyber Espionage Threats and Targets



Cyber Criminals


Organized Crime

Foreign Intelligence Entities (Cyber Spies)

Cyber Espionage Targets

Cyber Espionage Countermeasures

Cyber Espionage Awareness Training

Cyber Espionage Terms


Anonymizing Proxies

AutoRun Worm

Chain Letter or Email Malware


Data Theft, Leakage, or Loss

Denial of Service

Domain Name System Hijacking

Fraudulent Antivirus Malware

Internet Worm


Mobile Phone Malware


Social Networking Threat



Cyber Counterespionage Terms



Application Control



Intrusion Prevention System

Network Access Control

URL Content Filtering


Developing a Counterespionage Program

Conducting a Counterespionage Risk Assessment

The Counterespionage Plan

Counterespionage Awareness Training

Counterespionage When Traveling

Travel Preparations

Travel Itinerary





Transportation Hub Security

Hotel Security


Arriving at and Departing from Hotel


Counterespionage Security in a Foreign Country

Personal Conduct

Arrested! What Do I Do Now?

Counterespionage Audits

Counterespionage Investigations

Inductive Reasoning

Deductive Reasoning

Counterespionage Technical Surveillance Counter Measures (TSCMs)


Protecting Proprietary and US Government Classified Information

Identifying Information to be Protected

Marking of Protected Information

Secure Storage of Protected Information

Class 1

Class 2

Class 3

Security Filing Cabinets

Secure Destruction of Protected Information

Methods of Destruction

Paper Records

Electronic Media

Physical Destruction

Removable Media

Nonelectronic and Nonpaper Media

Protection of US Classified Information

Defense Security Service

Industry Programs Partnership with Industry

The Defense Security Service Vision and Mission

Classification of US Government Information

National Industrial Security Program Operating Manual

Marking Classified Information

Overall Classification Markings

Automated Information Processing Requirements

Portion Marking

Point of Contact Marking

Release to Foreign Countries/Organizations

Access and Need to Know

Protection of Classified Information When in Use

Protection of Classified Information When in Storage

Destruction of Classified Information

Methods of Destruction of Classified Information

Transmitting Classified Information

Reproducing Classified Material

Suspicious Espionage Activity

Cleared Employee Reporting Requirements

Check List of What to Report

To Whom to Report

Departure of Cleared Employees

Required Security Briefing

Manual for Physical Security Standards for Sensitive Compartmented Information

Compartmented Information Facility


Physical Security

Intrusion Detections System

Electromagnetic Contacts



Glass Breakage

Pressure-Sensitive Sensor





Passive Infrared

Capacitance Proximity

Dual Chamber Smoke Detector

Rate of Rise Heat Detector

Natural Gas or Carbon Monoxide Detectors

Water Flow

Security Cameras


Transmission of the Signal


Digital Recording and Monitoring

Motion Detection

Determining Total System Cost

System Design Cost

System Installation Cost

System Operational Cost

IT Related Cost

Maintenance Cost

Replacement Cost

Cost–Benefit Analysis

Cost of Loss

The Cost of Prevention

Return on Investment (ROI)

Total Cost of Ownership (TCO)

Cost Factor

Locks, Key Control, and Access Control

Mechanical Locks

Wafer Tumbler Lock

Dial Combination Lock

High Security Dead Bolt Lock

Card Access Electrified Locks

Exit Locks

Master Locking System

Control of Keys and Locking Devices

Master Key

Duplication of Keys

Lost Keys

Disposition of Employee Keys upon Transfer or Termination

Security Containers

Class 4

Class 5

Class 6

Security Filing Cabinets

Security Barriers and Fencing

Security Lighting


New Fluorescent (To Replace Incandescent)


Mercury Vapor

Sodium Vapor

Protection of Windows and Utility Ports

Annealed Glass

Wire Reinforced Glass

Tempered Glass

Laminated Glass

Annealed Glass with Security Film



Bullet Resistant Glass

Bullet Resistant Acrylic


Radio Frequency Identification, Magnetometers and X-Ray




Security Department

Chief Security Officer

Determining the Size of the Security Department

Mission of the Security Department

Legal Authorization to Protect the Facility

Pedestrian Stops

Profile and Security Threat

Size of the Facility

Hours of Operation

Number of Employees and Visitors

Proprietary Security Force

Contract Security Force

Security Department Uniforms and Identification

Staff and Visitor Identification

Security Department Protective Equipment


Oleoresin Capsicum Spray



Use of Force Continuum

Security Department Vehicles


Security Department Communications

Security Department Reports

Incident/Complaint Report and Continuation Report

Daily Activity Report

Protection of Security Department Information

Ethics and Conduct


Security Department Training

Professional Security Certifications

Security Patrols

Apprehension and Arrest


The Human Resources Department and Counterespionage

Position Description and Separation of Functions

Pre-Employment Background Investigation

Criminal Records

Civil Records

Driving Records

Employment History

Professional Licenses and Certifications



Financial History

Military Service

Personal and Professional References

Residence Inquiry



Internet Search


Periodic and Promotion Update Counterespionage Investigation

Non-Disclosure Non-Competitive Agreements

Employee Exit Interview


Counterespionage Resources

Private Professional Intelligence Organizations

Association of Former Intelligence Officers

Business Espionage Controls and Countermeasures Association

International Association for Intelligence Education


International Spy Museum

Naval Intelligence Professionals

Society of Competitive Intelligence Professionals

Private Professional Security Organizations

ASIS International

ASIS Certifications

Association of British Investigators

Association of Certified Fraud Examiners

National Council of Investigation and Security Services

World Association of Detectives

US Government Security and Intelligence Agencies

Defense Security Service




Federal Bureau of Investigation

FBI Mission




About the Author

Daniel J. Benny, PhD, CPP, PCI, CFE, CCO, is a licensed private investigator and security consultant. He holds a PhD in criminal justice from Capella University, a master’s degree in aeronautical science from Embry-Riddle Aeronautical University, an MA in security administration from Vermont College of Norwich University, a BA in security administration from Alvernia College, an associate’s degree in both commercial security and police administration from Harrisburg Area Community College; and a diploma in naval command and staff from the United States Naval War College.

He is board certified by ASIS International in security management as a certified protection professional (CPP) and as a professional certified investigator (PCI), a certified fraud examiner (CFE) by the Association of Certified Fraud Examiners, and a certified confidentiality officer (CCO) by Business Espionage Controls and Countermeasures Association.

He is the author of the books General Aviation Security: Aircraft, Hangars, Fixed Base Operators, Flight Schools and Airports, and Industrial Espionage: Developing a Counterespionage Program. He is also coauthor of the book The Complete Guide to Physical Security. He has authored more than 300 articles on security administration, intelligence, aviation security, private investigation, and cultural property security topics.

Dr. Benny served as a U. S. Naval intelligence officer with duty at the Office of Naval Intelligence, Naval Criminal Investigative Service, Willow Grove Naval Air Station, Fleet Rapid Support Team and Central Intelligence Agency. He also served as director of protective services for the Pennsylvania Historic and Museum Commission and a U.S. Navy police chief.

Subject Categories

BISAC Subject Codes/Headings:
HISTORY / Military / General
LAW / Forensic Science
POLITICAL SCIENCE / Political Freedom & Security / Terrorism