The Ponemon Institute has released a new report detailing the cost of phishing attacks on U.S businesses, suggesting the average annual cost for U.S companies has now risen to $4 million. Ponemon calculated phishing attacks take an average of 23.7 days to resolve, and are having a huge impact on U.S organizations, with smaller companies often suffering the most.

Cost of Phishing Attacks & Cyber Crime Assessed

The report indicates that the biggest costs suffered as a result of cyber crime come from phishing campaigns and social engineering, which accounted for 16% of total cyber crime costs. Phishing and social engineering were found to have affected 59% of organizations, while botnets affected 66% and web-attacks were suffered by 76% of organizations.

The Ponemon study, conducted in conjunction with HP Enterprise, involved a representative sample of 58 private and public sector U.S organizations being surveyed on cyber crime and the costs of dealing with criminal attacks. The results of the study show that in the U.S, the mean annualized cost of cyber crime has risen to $12.7 million per year, with the highest total average cost of dealing with cyber crime being $15.42 million – more than double that of Germany in second place.

The study showed that organizations are having to pay between $1.6 million and $61 million per year to resolve cyber attacks. The cost of the dealing with those attacks was found to be higher for larger organizations, although the per capita costs were highest for smaller organizations.

The new 2014 Cyber Crime Report shows the cost of dealing with attacks has risen 19% in just 12 months, with the global average cost of cyber crime estimated to have exceeded $7.7 million. Some companies are having to cover costs of up to $65 million to resolve criminal attacks, which were shown to have increased in both frequency and severity during the past 12 months. Email attacks remain one of the biggest causes for concern, being one of the main methods used by criminals seeking access to computer networks.

Phishing Emails Are Proving to be Highly Effective

Earlier this year, communications company Verizon produced a report indicating phishing campaigns can be highly effective methods of attack, and suggested that all too often staff training efforts are not particularly effective.  Many organizations are now providing staff with information on how to identify phishing emails, yet this information does not appear to be retained. The study found that 23% of individual who received a phishing email opened it, and an alarming 11% of recipients clicked on the link contained in the email or opened the attachment.

The provision of training manuals on phishing to employees can be effective, but retention of information tends to be poor. The Ponemon study did suggest that one of the best methods of training staff how to identify phishing emails is to provide examples, indicating the sending of simulated phishing emails was particularly effective at reinforcing training, providing up to a 37% return on investment.

With phishing emails representing such a substantial proportion of cyber security costs, and training proving not always particularly effective at substantially reducing the risk of attacks being successful, greater efforts should be put into intercepting phishing emails and preventing them from being delivered to recipients’ inboxes. For that, a robust and effective email spam filter is required.