Cyber crime is costing the UK economy a whopping £27bn a year, according to new government figures.
This estimate is based on the finding of a new report, entitled The Cost of Cyber Crime, compiled by the Office of Cyber Security & Information Assurance and information intelligence specialist Detica.
The report, which was unveiled today by security minister Baroness Neville-Jones, estimates that over 12 months cyber crime cost government and citizens £2.1bn and £3.1bn respectively.
The private sector, however, absorbs more than three-quarters of the economic impact of cyber crime in the form of theft of intellectual property and industrial espionage, the report states.
The theft of intellectual property from business is estimated to be £9.2bn per annum.
Industrial espionage has the second biggest impact at £7.6bn, followed by £2.2bn from extortion, £1.3bn from direct online theft and £1bn from the loss or theft of customer data.
The hardest hit sectors are pharmaceuticals and biotech, electronics, IT and chemicals.
The £3.1bn annual economic cost of cyber crime to UK citizens includes an estimated £1.7bn for identity theft and £1.4bn for online scams.
Prime minister David Cameron this week met with ministers and senior business leaders to discuss a new approach to cyber security.
Neville-Jones said: "This report is an important example of how government and industry are working together to tackle specific threats posed by criminal use of the internet."
Detica managing director Martin Sutherland said: "The next step for the UK is to formulate a more targeted response to IP theft and industrial espionage in particular. We must mobilise joint government and industry forces to build a coherent picture of the threat and create a consistent mechanism that will allow businesses to report cyber crime without the risk of reputational damage."
According to Andy Philpott, Websense vice-president of sales for UK and Ireland, UK businesses are facing increasingly sophisticated attacks.
"Modern hackers are using blended attacks to steal data. These target a number of different channels, such as email, web pages and social networks such as LinkedIn and Twitter," he said.
"Traditional security products are ineffective against this as they only protect certain parts of the network. Only a truly unified security architecture – which protects mobile workers and branch offices – can handle this next generation of security threat."
In related news, security company Symantec yesterday released research that suggests each cyber crime victim in the UK will lose £103 on average, and that 19 million UK citizens, a third of the population, will be affected by cyber crime in 2011.