How to Protect Your Small Business Against a Cyber Attack Follow these steps to boost your company's security measures and thwart hackers -- keeping yourself, your employees and your customers safe.

The Seattle hacker drove a black Mercedes. He owned a Rolex. He liked to frequent a downtown wine bar. While it's easy to think of cyber criminals as faceless, digital pickpockets in far-flung countries, the reality is that they are among us. In one notorious case, a bandit and his gang of cyber crooks compromised at least 53 Seattle-area small and medium-size businesses between 2008 and 2010, stealing enough data to cause $3 million in damages to the companies, their employees and their customers.

"This wasn't the type of crime that we anticipated," tech-company employee Alec Fishburne said at a news conference (where the Seattle victims agreed to be identified but asked that their businesses remain anonymous). The gang hacked Fishburne's firm from another office within the high-rise building. He became aware of the breach after noticing some unusual financial transactions. "It was very disconcerting for a small company … to wonder whether there was some internal fraud or embezzlement happening," he told reporters.

Another Seattle company was hacked after its old laptops were stolen in an office break-in; about a month later, funds were siphoned out through fraudulent payroll accounts. A third victim had the identities of almost all its employees stolen when the hacker gang cracked the company's network security. "It's enraging, because you think you have a system that's going to work," said the company's president. "These guys are really smart and ambitious, and that's a tough combination."