McGladrey said access can also be a problem, noting that the Verizon report flagged third-party involvement as contributing to 61% of manufacturing breaches. "Think about always-on VPN credentials issued to equipment vendors years ago that nobody has thought about since the equipment went on the shop floor," McGladrey said.

That 3% has a reason, Kayne McGladrey, author of the forthcoming "Cyber Risk is a Myth" and a senior IEEE member, told VentureBeat during a July interview. "It's only those well-resourced companies that are above the poverty line that have met all the prerequisites," he said.

If a multi-billion-dollar frontier lab can't keep its own models contained during controlled testing, why would you trust your dev team's implementation of an open-weight model? - Kayne McGladrey, fractional CISO

McGladrey walks through how that fails in practice. An agent told to "retrieve the market data report," he explains, could use an unauthenticated connector to skip the payment handshake, hand a fraudulent report to a paying client, and, under a deferred-settlement model that x402 supports, keep the discrepancy hidden until batch reconciliation shows a valid signature that delivered the wrong resource.

Almost nobody has built it. Kayne McGladrey, a senior member of the IEEE, has argued for years that an AI deployment needs a hard governance threshold, a named human holding a kill switch and a way to roll back. Asked whether any Fortune 500 company runs that, he was blunt. “I haven’t seen it done, and no, they haven’t come out and publicly said it,” McGladrey told VentureBeat.

"Kayne McGladrey, an IEEE senior member who advises enterprises on risk, put the funding logic bluntly in an interview with VentureBeat. “Anything that seems to have a cybersecurity flavor is generally put into the cybersecurity risk category, which is a complete fiction,” McGladrey said. “They should be focused on business risks, because if it doesn’t affect the business, like a financial loss, then nobody’s going to pay attention to it, and they will not budget it appropriately.” A rank number from a 29-person vote is a weaker budget argument than the business system the agent touches."

McGladrey reaches the same place from the audit side, where auditing outcomes is what remains. “We can audit code for compliance. We can audit code for security. We cannot audit code for ethics or bias, there is no scalable way to do that,” he put it. “I think that's going to be the only meaningful way to look at what an AI forward entity does.”

Kayne McGladrey, a senior member of the IEEE, has noted the structural distinction that explains why this matters for agent models specifically: "synthetic data lacks the unpredictability of human responses to the unexpected, such as when a window moves or is resized," and behavioral training data is what teaches a model "how tools flow together."

“If you look at the successful investigations over the past five years, there’s been about $350 million in ghost student schemes that have been thwarted,” says Kayne McGladrey, a cybersecurity risk adviser and senior member of IEEE, a nonprofit professional organization that champions technical innovation.

Improving access controls on AI models is the most obvious security gap to close, according to Kayne McGladrey, a senior member of IEEE, CISSP-certified cybersecurity advisor, and independent virtual CISO. “Treat your models and their APIs like crown jewels,” says McGladrey. “If you wouldn’t expose your database to the public internet without identity and access controls, why would you do that for your AI model?”

The pressure to fix this will not come only from threat reports. It is about to come through contracts. Kayne McGladrey, a senior member of the IEEE, told VentureBeat in an exclusive interview that enterprises are starting to push software security obligations onto the vendors and maintainers in their supply chains. "We're going to start seeing companies trying to contractually shift liability to other parties in their supply chain," he told VentureBeat. "We're using your technology, but we want you to do the security for it."

As an independent virtual CISO with a background in risk management, cybersecurity, and regulatory compliance, I prefer facts over marketing claims. For TechRound’s HealthTech44 2026, I ranked the submissions on five evidence-based dimensions: stated security maturity, AI claim substantiation, clinical validity, patient impact, and the team’s credibility. Companies that scored higher had provided named certifications, published benchmarks, regulatory clearance, quantified outcomes, and experienced clinical leaders named in their submission. By comparison, entries with visible AI instructions, placeholder content, or contradictory claims were disqualified, and submissions that were primarily unsubstantiated product marketing ranked poorly with me.

That figure makes the argument fundable. Kayne McGladrey, an IEEE Senior Member who has spent his career in identity security, told VentureBeat that security teams lose these fights by filing the exposure under the wrong heading. Companies "should be focused on business risks rather than some, you know, cybersecurity risk, because if it doesn't affect the business, like a loss or financial loss, in this case, predominantly, then nobody's going to pay any action to it, and they will not budget it appropriately, nor will they adequately put in controls to prevent it," he said. A destroyed model carries a known replacement cost, which is the version of this story a CFO acts on.

This AI security incident report is built for CISOs and security leaders operating AI agents today. Reviewed by hundreds of CISOs, this paper explains how the autonomous AI attack unfolded, what made it detectable, and what security teams should do next to secure agentic AI systems.

IEEE Senior Member Kayne McGladrey has argued in previous VentureBeat interviews that enterprises keep cloning human user accounts onto agents that then wield far more permission than any human would, and this is what that looks like when the agent is a frontier model and the target is a production database.

Finally, Schrems III is nigh: with the US Supreme Court's ruling undermining the independence of agencies like the FTC — the very foundation of the EU-US Data Privacy Framework — Max Schrems is poised to strike down transatlantic data transfer agreement number three.

No one expects a cybersecurity incident to begin in the cardboard industry. Yet as our guest Kayne McGladrey explains, cybercriminals don’t care what your company manufactures—they care about opportunity.

Independent vCISO, Senior member of the IEEE, author of the GRC Maturity Model and the upcoming book "Cyber Risk is a Myth", Kayne is a go-to voice on treating GRC as a core business competency rather than a one-time project. He has a rare gift for making complex risk feel simple and actionable in the boardroom.

Kayne McGladrey, an IEEE Senior Member, described the structural challenge in an exclusive interview with VentureBeat. “The CISO doesn’t have the budget. The CISO doesn’t have the staff. We can observe risks, we can advise on business risks, but we don’t own the business systems affected by those risks,” McGladrey said. When agent governance spans six departmental budgets, no single executive can confirm whether agents get the same access reviews as humans.

Kayne McGladrey, IEEE Senior Member, has confirmed the pattern across multiple published VentureBeat interviews. The structural gap in self-reported coverage is not new. What is new is that autonomous agents will act on it at machine speed without the institutional workarounds human analysts developed over years of experience.