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Daily Insurance Industry News
Saturday 23rd of June 2018
January 26, 2009

Credit crunch pushes up client theft

by David Masters

Story link: Credit crunch pushes up client theft

The number of employees stealing confidential information from former workplaces has risen dramatically, a City law firm has revealed.

Reynolds Porter Chamberlain (RPC) said the last two years have seen a sevenfold leap in the number of claims brought by businesses against former employees for using confidential information.

Claims launched in the Chancery Division of the High Court have increased from 3 in 2006, to 23 last year.

For every case that reaches the courts, there are many more disputes that are settled outside court.

RPC said most of the cases relate to employees taking confidential client lists. Financial services companies, including insurance firms, are particularly vulnerable to this type of theft.

The trend is expected to continue in 2009 as the recession deepens, RPC said.

RPC partner Cath Thorpe said: “Rising job insecurity is encouraging more employees to use the confidential information they have obtained with their current employer when they begin working for a competitor.

“Other employees are setting up their own businesses using confidential information in order to compete head-to-head with their former employer.”

 

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