Rich,In response to the following article:
Consider how difficult an American company will have prosecuting
criminals in another country.
Consider that the reporting news agency might have labeled the crime
unit as cyber crime unit and in fact immaterial to the argument.
Consider moving the data out to foreign countries increases the likely
hood of such a theft where America and it's company's are considered a
targets.
I'm sure some of the "low-skill and low-value-added" people who have a
hard time finding work would take offense to that description you
backhanded your readers with. One might even consider journalism to
fall under that auspicious set of adjectives. Seems there are plenty
of journalists world wide who would and could take up internet
journalism positions quite easily and because of the timelines be
available to write articles 24/7 based on other articles they read on
the internet. The foreign journalist would work for less pay and not
worry about American laws digging up dirt.
How about an article lauding the selling of our steel industry out
from under us? Raping the employees of benefits, pensions and
exposing the soft underbelly of our economy? The investors will make
a great profit and our foreign handlers will be kind and keep our
workers employed for now. It looks like everyone is a winner here
especially if you ignore the lack of benefits and avoid thinking about
the future.
- Eric T
How Dangerous Is Outsourcing?
By Rich Smith
Uh-oh. From hundreds of miles away in all directions, I can hear the collective inhale from the critics of outsourcing, as they get ready to unleash a righteous bellow of outrage over Saturday's news. If you haven't heard it yet, here it is.
Over in Pune, India, banking giant Citigroup (NYSE: C - News) has outsourced some of the customer-call-center operations for its Citibank subsidiary to a company called "Mphasis BPO." Back in December, three employees of Mphasis stole the account information and PINs for four Citibank retail customers before quitting their jobs. Upon leaving Mphasis' employ, these three people, along with as many as nine co-conspirators, used the account information to wire more than $300,000 from the Citibank customers' accounts, to several accounts set up in Pune.
Opponents of the trend to outsource low-skill and low-value-added work to countries like India will undoubtedly want to use this Mphasis incident as ammunition in the PR war against outsourcing. They'll say that information sent to outsourcees abroad is inherently unsafe and open to abuse like what just occurred in Pune. That's true to an extent, but it misses the point.
Like it or not, the fact remains that information can be stolen anywhere. The recent hacks of confidential personally identifiable data at ChoicePoint (NYSE: CPS - News), Reed Elsevier (NYSE: ENL - News) and Retail Ventures (NYSE: RVI - News) prove that. Information can be lost, as we saw happen with Bank of America's (NYSE: BAC - News) mysterious vanishing data tapes. And yes, information can even be stolen by employees of the company to which it's entrusted; not only in India, but right here in the U.S., as dozens of H&R Block (NYSE: HRB - News) clients learned in 2002.
Exaggerating the dangers of outsourcing and sending data abroad won't make our data any more secure. On the contrary, the facts of the Mphasis case suggest that in some cases, data may be safer once sent abroad. Reflect for a moment on how quickly the alleged criminals in Pune were caught. Consider for a second the fact that they were caught by the "cybercrime unit" of the Pune police force. Ponder for a minute the fact that a place most of us have never even heard of before (really? "Pune?") even has something called a "cybercrime unit." I know my hometown doesn't.
Then come to the correct conclusion: Outsourcing wasn't the problem here. The problem was criminals, plain and simple. And those can be found the world over.
Fool contributor Rich Smith owns no shares in any company mentioned in this article.
