The U.S. is in the crosshairs of foreign competitors and intelligence services seeking to obtain valuable knowledge and other intellectual property, according to a new report from the Information Technology and Innovation Foundation (ITIF), a think tank for science and technology policy.

“Government counterintelligence outreach to the commercial sector is long overdue for reform. It relies too heavily on investigations following up after security breaches rather than proactively recognizing and responding to threat indicators,” said former FBI counterintelligence analyst Darren Tromblay, the report's author.

To counter this threat, ITIF recommends that the Trump administration establish a new public-private partnership to better coordinate commercial counterintelligence efforts with industry.

“By including private industry as a formal stakeholder, counterintelligence efforts can more effectively protect key U.S. intellectual and technology assets from being taken by adversaries and competitors,” said Tromblay. “It will encourage companies to better incorporate counterintelligence concerns into their due-diligence process, which will make them more effective partners in thwarting foreign threats.”

ITIF recommends a new, more proactive approach to coordinating counterintelligence outreach between the government and commercial sector. The report calls on the Trump administration to establish an interagency hub, structured as a public-private partnership, to consolidate inconsistent and partly redundant counterintelligence outreach programs that are currently operated by the Federal Bureau of Investigation, the Department of Homeland Security, the Department of Commerce and the Department of Defense.

This new entity should be charged with translating sensitive concerns identified by the U.S. intelligence community and other information collectors, into publicly distributable products. In addition, it should enlist the active participation of the private-sector entities at risk, since they are the first line of defense and best postured to identify anomalies. And it should assist industries trying to navigate legal, but unscrupulous activities.

“Existing counterintelligence arrangements between government and industry have long been inconsistent and redundant–and even if they were running like a Swiss watch, the underlying premise itself is outdated,” explained Tromblay. “The U.S. government is no longer the driver of innovation; it's an adopter and adapter of knowledge and capabilities developed outside the public sector.”

So now, the tables have turned, as there is less financial incentive for the private sector to collaborate with government, and there's more incentive for the government to collaborate with the private sector. Industry is in the crosshairs of foreign actors. It's in a position not just to benefit from information the government can offer, but also to provide key insights that government can act on. And, a public-private partnership akin to the National Endowment for Democracy could facilitate that, per Tromblay.

According to ITIF president Rob Atkinson, more and more nations seek competitive advantage in innovation-based industries. Gaining IP without paying for it is a shortcut for many nations, and given that the U.S. has the world's leading innovation companies, stealing U.S. IP is a prime focus for some nations.

There are two ways to counter this threat, he told us, defense and offense.

“Defense involves a much more robust commercial counterintelligence effort by the U.S. government, including increased funding for the FBI, and a closer partnership between USG and industry,” he explained. “Offense involves sending a much clearer and forceful message that the U.S. will no longer stand for wanton theft of U.S. IP and that nations that persist in this, like China, will be punished.”

Amanda G. Ciccatelli is a Freelance Journalist for Corporate Counsel and InsideCounsel, where she covers intellectual property, legal technology, patent litigation, cybersecurity, innovation and more.