The Roman Senator Cicero famously wrote, “A nation can survive its fools, and even the ambitious. But it cannot survive treason from within. An enemy at the gates is less formidable, for he is known and carries his banner openly. But the traitor moves amongst those within the gate freely, his sly whispers rustling through all the alleys, heard in the very halls of government itself.”
What is true for nations is also true for corporations. You guard against attacks from the outside, and rightly so. You need to protect your customer data and your proprietary information from hackers. But if you are a business that relies on trade secrets (and what company doesn’t?), you need to realize that your greatest threat of misappropriation or theft is from your own employees.
First, let’s understand what a trade secret is. A trade secret is an Intellectual Property asset that gives your company a competitive advantage precisely because it is a closely guarded secret. Your trade secrets are protected by federal law, specifically the Defend Trade Secrets Act of 2016, and, unlike patent or copyright, there is no expiration date for trade secret protection. However, as soon as your trade secret becomes public, it’s game over. You might be able to claim damages for the loss, but you’ll never again be able to leverage the secret to get an advantage in the marketplace.
So, given the importance of trade secrets, it’s important to know that the greatest threat of a breach doesn’t come from an outside source. The person most likely to misappropriate your trade secrets is a highly trusted employee of your company. The leak can be intentional: an employee leaves your firm and takes vital IP with him. Despite a nondisclosure agreement, the employee either goes into business for himself or shares your secrets with his next employer. But trade secrets can also be lost unintentionally. Competitors may spy on your employees and elicit information from them on the sly.
So, how can you protect vital secrets? Here are a few steps we recommend:
- Identify the information you need to guard — This is any information you hold that would benefit your competitors if it got out.
- Determine how this sensitive information is at risk — Is it shared too widely, especially with employees who don’t need to know? Is it stored securely?
- Develop a security policy — You want to strike a balance between using the information in your business processes and keeping it from prying eyes. Update your plan periodically to adapt to changing conditions.
- Train your employees — Your workers need to know what a trade secret is, how vital it is to the success of your company, and how important their roles are in your security scheme.
Contact Breon & Associates in Harrisburg
At Breon & Associates, we are experts in the processes that make businesses more efficient. If you want to learn more about protecting your company’s vital Intellectual Property, contact a fraud prevention expert at Breon and Associates today. With offices in Harrisburg and North Central PA, Breon & Associates provides business, accounting and tax services throughout Pennsylvania. Call us at 1-888-516-8476 or 717-273-8626, or contact one of our offices online to schedule an appointment.
415 Market Street, Suite #205
Harrisburg, PA 17101
North Central PA Office:
86 Municipal Drive
Avis, PA 17721-8941
Camp Hill Office:
3461 Market Street, Ste 101
Camp Hill, PA 17011