In September, an information technology specialist at a prominent Silicon Valley law firm was arrested and charged by the FBI with insider trading. It marked the second time in two years an employee at Wilson Sonsini Goodrich & Rosati PC had been busted for a similar crime.
Cyberthreats such as this illustrate the threats that can come from inside and out, and Pittsburgh-area law firms have stepped up their vigilance accordingly.
"There have been a number of recent higher-profile cases where employee theft has been an issue for technology and trade secrets information and, of course in today's environment, there's always the concern of hackers accessing databases," said Kirk Miles, director and vice president at The Webb Law Firm. "It's something we as a firm recognize as a concern because our clients do trust their technology with us and we try to protect that by making sure our systems are secure."
Steps that law firms can take to ensure their data remains safe include the use of firewalls, secure data backups, encryption of confidential information, electronic audit trail procedures that track who is accessing confidential data and training employees who use external access portals on password protection and other security policies.
"We have given significant and careful consideration to the issue and have taken appropriate safeguarding steps," said George Stewart III, Pittsburgh managing partner at Reed Smith LLP, Pittsburgh's 10th largest private company. "We have technology safeguards and continuous training in place to help us avoid these situations."
Understandably, many local firms, including Reed Smith, are not willing to disclose the details of their strategy to protect client information.
However, few would disagree that law firms — and their clients — are increasingly vulnerable to technology and information breaches and even combinations of the two.
The concern about the potential for insider trading and other breaches begins even before a lawyer is hired. In today's security-conscious environment, firms are getting pickier about who they hire at the partner level, according to Lori Carpenter, president of recruitment firm Carpenter Legal Search.
"Ten years ago, if I sent a partner with a $2 million or $3 million book of business to a firm, they (the potential employer) were always excited right out of the gate," she said. "That's not the case now. They've become a lot more discerning, really zeroing in on who they (the potential employees) are as people. Increasingly, it's been an evolution in terms of the process of hiring partners. We've seen more and more partners who must sign confidentiality agreements, most often before receiving an offer."
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Cyberthreats prompting firms to tighten access to clients’ records - by Patty Tascarella, Pittsburgh Busniess Times