Insider Risk Digest: Week 49-50


Every two weeks, we bring you a round-up of the cases and stories that caught our attention in the realm of insider risk. This marks the last volume of the Insider Risk Digest of 2023, with stories focusing on trust traps, fictitious espionage trials, and toxic workplace cultures. 

2023 was marked by several high-profile fraud cases, with major cryptocurrency companies such as FTX and Binance falling victim to this type of insider threat. 2023 had one more high-profile case in store for us however, this time arising within the social media giant Meta, previously known as Facebook. Between 2017 and 2021, Barbara Furlow-Smiles was head of diversity, equity and inclusion initiatives at Meta. Throughout her years at the company, she used her position of trust to cheat and defraud Meta of over $4 million, later used to support her luxury lifestyle. Payments were made to her friends and associates on behalf of Meta, with no goods or services ever provided in return, and the money being re-wired back to her bank accounts directly.

This exemplifies a classical case where an organisation falls victim to the trust trap. Organisations want to trust their employees and show that they trust them to maintain a good relationship between the organisation and its employees, which can increase morale and productivity. However, essential behavioural and technical monitoring procedures can erode over time because of this. Lower levels of monitoring lead to undiscovered indicators, resulting in an overall lower perceived risk of an insider act. This false sense of security reinforces managers’ trust in the individuals working for them.

Human Intelligence operations, especially targeting nation-states, are charged with elevated risk. In the diplomatic world, diplomats can gain privileged access to the utmost sensitive information, to spy for their country or a third party. The case of Victor Manuel Rocha has highlighted the extensive scope and information that insiders can compromise in the interest of national adversaries. But what if Espionage claims are fabricated to facilitate an exchange of prisoners?

Swedish Diplomat; Johan Floredus, now a prisoner in Iran after visiting the country on holiday. Iran has arrested Floredus on grounds of Espionage for the benefit of Israel, and after over 600 days, he finally faces trial. However, Swedish Foreign Minister Billstrom, and EU foreign affairs Borrell calling for his release. Espionage charges in Iran can lead to a death penalty. However, Aftonbladet, a leading Swedish newspaper, has suggested that this arrest and subsequent trial may be an effort to force Sweden into a prisoner exchange. Indeed, earlier this year Sweden convicted two Iran-born brothers over Espionage allegations in the interest of Russia. This case highlights the intricate and complicated consequences of Espionage, and how Insiders may be “fabricated” to exert influence over strategic adversaries.

Sellafield’s nuclear site workers have been making claims of a toxic workplace culture, defined by bullying, sexual harassment and drug-taking issues. With the sensitive nature of the workplace, multiple sources have warned that these workplace culture characteristics bring heightened risks related to accidents, suicide, and sabotage. A year-long Guardian investigation led to revelations of cyber hacking, radioactive contamination and a toxic workplace culture at Sellafield’s nuclear site. The Guardian’s invetsigation’s most disturbing findings include suicides linked to pressures of working at the site, cases of sexual harassment, and individuals taking narcotics to the work place and faking urine samples in cases of random drug tests. Several nuclear disasters have been linked to a toxic workplace culture, notably that of Chernobyl. Whilst in many sectors, the effects of a toxic workplace may not be tangible, in critical infrastructure, a toxic workplace can lead to devastating consequences. 

We have explored many cases previously where departing employees take Intellectual Property from their previous employer to benefit their position at their new employer. However, this case reveals a case of misconduct, and revenge. Daniel Brody, 38, was fired from San-Francisco-based bank First Republic after being caught downloading pornograph on his work computer, and lying about being sick in order to make personal trips. As an act of retaliation, Brody deleted the Bank’s code repositories and downloaded proprietary code he worked on as an employee. In total, his actions cost First Republic over $220,000, and will have to pay over $500,000 in restitution alongside serving two years in prison. Whilst insiders may usually be understood as current employees, the damage former employees can cause is just as high.

Another case of fraud, another case of an organisation falling for the trust trap. A former  Jacksonville Jaguars employee committed wire fraud, racking up over $20 million in fake credit card purchases, with the majority of this cash used to support his gambling addiction. The former employee, Amit Patel, was the administrator of the team’s virtual credit card program and used his position of trust to make his personal purchases seem like legitimate business transactions. In a statement released by the Jacksonville Jaguars we read: “As was made clear in the charges, this individual was a former manager of financial planning and analysis who took advantage of his trusted position to covertly and intentionally commit significant fraudulent financial activity at the team’s expense for personal benefit”. Whilst the question remains on why no one noticed Patel’s activities and addiction earlier, this case serves as a stark reminder than insiders can abuse their privileged positions and access for a variety of malicious acts, no matter the sector.

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