IT security executives are starting to face up to the realisation that the biggest threat they face comes from internal security attacks and data breaches.

A recent survey conducted by The Strategic Counsel and commissioned by management and security software vendor CA showed that a majority of CIOs, CSOs, CTOs and other senior IT security executives consider security threats from within an organisation a bigger threat to business than external attacks. The results revealed that 44 percent of respondents identified internal breaches as a key security challenge over the past 12 months, compared with 42 percent in 2006 and 15 percent in 2003. More than 34 percent of organisations reported a loss of confidential information as a result of security attacks and breaches, an increase from 22 percent in the same survey conducted in 2006.

However, external attacks are decreasing in numbers. According to the report, virus attacks decreased from 68 percent to 59% in the past 12 months, network attacks went down from 50 percent to 40 percent and denial-of-service attacks declined from 40 percent to 26 percent.

"The security breaches identified by IT security executives as most concerning are those coming from inside the company," says Lina Liberti, vice president of CA Security Management. "The external threats still exist, but IT security executives feel more confident that they can be quickly addressed, stopped or controlled to some degree. They identified internal security breaches and attacks as those with the biggest severity of consequences."

Internal breaches strike fear in the heart of IT security executives because of the company image blow and customer confidence issues that accompany an attack and that could expose confidential customer data and require public disclosure. Business costs associated with an internal breach include loss of productivity for 61 percent of survey respondents (up from 52 percent in 2006). Loss of trust and confidence on the part of the customer also increased to 35 percent in 2008 from 30 percent in 2006. And embarrassment on the part of the company suffering the breach grew to 33 percent this year from 28 percent in 2006. "The implications are now tied squarely to dollars and reputation," Liberti says.

"It makes sense that customer confidence is not high because now more than ever consumers know more about computing, the Internet and the public breaches that companies have experienced," Liberti explains.

Consumers also feel companies could do more to protect their data. According to the survey data, 72 percent don't think retailers spend enough budget dollars on online security and privacy. Nearly 70 percent felt the same way about government agencies and 58 percent said major financial institutions could do more to protect customers. About one-third of senior IT executives polled agree, saying the investment their company makes in security is inadequate.

"Consumers aren't confident transacting online, and security teams know the threat is ever-changing and that their jobs are never done," Liberti says. "Security executives know they need to continue to spend in this area to help raise consumer confidence."

For the consumer portion of the study, a total of 400 telephone surveys were conducted among a random sample of the U.S. general population aged 18 to 65.