| GartnerGroup Sees Potential for Losses of Billions of DollarsDue to Electronic Theft Linked to Y2K |
| Companies Advised to Guard Against Fraudulent Activities |
| Stamford, CT - July 16, 1999 - Gartner Group, Inc. (NYSE: IT) today issued an advisory for companies to guard against potential thefts directly linked to year 2000 (Y2K) IT security failures. According to a recent GartnerGroup research report, vulnerable companies could lose billions of dollars. The likely perpetrator would be a highly skilled software engineer who has worked on Y2K remediation efforts and understands both computer systems and the underlying business processes. |
| According to the report -- "Year 2000 and the Expanded Risk of Financial Fraud" -- two pervasive but unrelated forces are converging to support this scenario. First, the world's financial systems have largely migrated to an electronically interconnected business model. According to statistics released by the National Automated Clearing House Association, $11 trillion in electronic transfers occurred in the United States in 1998. Second, virtually every line of code, every interconnection, and every computer involved in this process will have been opened, tested and possibly changed to support Y2K remediation efforts. |
| "Given the enormity of the Y2K task, the vast number of people assigned to fix the problem, and the element of human foibles, it should come as no surprise that at least one significant theft will occur in the next five years," said Joe Pucciarelli, GartnerGroup analyst. "Y2K remediation, by definition, creates and increases the opportunity for theft and fraud. When you ask the king's soldiers to rebuild the king's castle, the royal army has more opportunity to steal." |
| "Given the enormity of the Y2K task, the vast number of people assigned to fix the problem, and the element of human foibles, it should come as no surprise that at least one significant theft will occur in the next five years," said Joe Pucciarelli, GartnerGroup analyst. "Y2K remediation, by definition, creates and increases the opportunity for theft and fraud. When you ask the king's soldiers to rebuild the king's castle, the royal army has more opportunity to steal." |
| The report further outlines risk management plans for the most effective theft and fraud deterrents: 1) identify and assess all Y2K-related theft and fraud risk; 2) reinforce Y2K security and quality control procedures; and 3) review enterprise insurance coverage. |
About GartnerGroup
As the world's leading authority on IT, GartnerGroup provides clients with a wide range of products and services in the areas of IT advisory services, measurement, research, decision support, analysis, consulting and training. Founded in 1979, with headquarters in Stamford, Conn., GartnerGroup is at the center of a global community of more than 11,000 client organizations served by analysts in 80 locations worldwide. Additional information about the company is available on the World Wide Web at www.gartner.com. |
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