Reducing the Risk of Intellectual Property Theft

Intellectual property theft comes in many forms, as it ranges from counterfeiting, copyright and patent infringements to the sale of trade secrets and product creation processes.

Posted by Joe Gerard in Brand Protection, Corporate Security on May 6th, 2010

Intellectual property theft comes in many forms, as it ranges from counterfeiting, copyright and patent infringements to the sale of trade secrets and product creation processes. The risk of disgruntled current or former employees leaking important confidential information to competitors or the public is a universal concern.

In the United States, President Barack Obama named Victoria Espinel as the U.S. Intellectual Property Enforcement Coordinator, a position created to end the sale of pirated or counterfeited movies, music, drugs and software. The threat of intellectual property theft isn’t isolated— counterfeit items and stolen information can be found internationally. Here are some steps that you can take to protect your company’s intellectual property:

1. Document Tracking System

Information exists in a variety of formats and across various locations, making document management a difficult task.  According to the experts at Deloitte, one of the best ways to protect a company from IP theft is to know where corporate documents are at all times:

FREE Investigation Report Template

Prepare thorough, consistent investigation reports with our free report template.

Download Template

“Have an inventory of intellectual property across your enterprise and know what your company’s intellectual property is, where it is, and what it’s worth. It’s also important to understand that managing your company’s intellectual property is more than just registering patents and trademarks.”

In most cases, documents are stored in various locations and many storage facilities use bar codes, RFID tags or other tracking devices to locate the data you send to them. These types of tracking systems are invaluable when implemented internally. Make sure inventory systems are managed properly and include procedures for information access to enact tighter controls over the flow of information.

2. Signed Confidentiality Statements

Have employees read, understand and sign a statement addressing the need for strict confidentiality regarding the protection of intellectual property and corporate information. Employees need to understand they will face consequences for violating information protection policies. The article “Business Intellectual Property Theft” on BusinessTheft.com mentions companies can:

“Protect patented technologies and company trade secrets by requiring employees and contractors to sign non-disclosure, confidentiality, or non-compete agreements when necessary. Make it clear what information is proprietary and confidential. While this won’t stop all instances of intellectual property theft by employees, it gives your business a more solid legal foundation to pursue damages if you have to take it to court.”

3. Internal Reporting Systems

Implement a system that allows for both employees and external sources to report counterfeit products or IP theft. This helps to stop employees from attempting to sell trade secrets or client lists, as they are aware of the consequences for violating policies. External sources can be used to report and locate vendors that are selling counterfeit products. i-Sight Investigation Software is easy to integrate into existing systems, allows for multi-channel case entry and helps the investigative team conduct timely, accurate investigations.

4. Limit Access to Information

If an employee doesn’t warrant access to certain areas of information, don’t allow them access. If an employee requests to view files temporarily, consider allowing the employee to do so, but then restricting them as soon as they have the information they need. Work together with the IT department to make information policies a reality. Internal access restrictions help enable stronger control over company information. Restrictions also reduce the ability for employees to take company information with them whenever they are away from work or their employment has been terminated.

5. Use Data Loss Prevention Software

Regulations (both governmental and commercial) have been put in place to penalize companies in certain industries for failure to demonstrate appropriate or sufficient data controls. Certain industry guidelines require mandatory IT audits on a regular basis. This is common in the healthcare (HIPAA) and finance fields (GLBA and Basel II for example). Many data loss prevention software providers have built in controls to help prevent the theft of intellectual property.  DLP software monitors users and data while information is both in use, closed and in transit. DLP software ensures company rules are followed when users access and send information. This prohibits information from being viewed or sent if the employee isn’t permitted to do so.


Joe Gerard
Joe Gerard

CEO, i-Sight

Spend my days showing off the i-Sight investigative case management software and finding ways to help clients improve their investigations. Usually working with corporate security, HR & employee relations, compliance and legal teams.

Visit Website

Want to conduct better investigations?

Sign up for i-Sight’s newsletter and get new articles, templates, CE eligible webinars and more delivered to your inbox every week.