Cybercrime is costing the world economy billions of dollars and is on the increase, according to President Bush's cyber-security adviser. "We have a great deal of focus nowadays on weapons of mass destruction but we need to be aware of the proliferation in cyberspace of weapons of mass disruption," Howard Schmidt told Reuters in an interview.

The criminals range from terrorists to backroom hackers who know no frontiers.

"Cyber crime is costing the world economy billions of dollars and it is still on the increase," Schmidt said. "The more we depend on the system, the more we use the system, the more they will exploit it."

Schmidt, former chief security officer at Microsoft is in London for a conference on computer security.

"What we are concerned about is reducing vulnerability whether the threat is from the Mideast or the Midwest," he said.

From "Bugbear" to "Code Red", Internet communications have been plagued by viruses that can cause instant havoc.

"Anna Kournikova" was developed by a 20-year-old Dutchman. It spread to hundreds of thousands of computers via e-mail. The hoax e-mail carried an attachment that was identified as a picture of the Russian tennis star.

Once opened, it spread around the world, slowing down e-mail systems and shutting down some servers.

The worm's author, Jan Dewit from the Dutch town of Sneek, was arrested after turning himself in.

The Love Bug was first detected in Asia on May 4, 2000. The most destructive computer worm of all was predicted at the time to have done billions of dollars in damage. It carried the phrase "I love you" in the subject line of an e-mail.

Unwitting victims, including the Pentagon and the Central Intelligence Agency in Washington and the British parliament, opened the e-mail and systematically spread the corrupted message to every address in their inbox. It forced network administrators to shut down e-mail systems.

It was traced to 27-year-old Filipino Reonel Ramones. But the case was later dropped by Philippine authorities.

Schmidt, Vice President of President Bush's Critical Infrastructure Protection Board, insisted the fight against the hackers "is not a losing battle but an ongoing tug of war."

But he did concede: "Cyber-related incidents are increasing in number, sophistication, severity and cost."

He called for "closer co-operation industry to industry, government to government and government to industry. We are all part of cyberspace and all have to do our part to protect it."

For hackers can be such elusive prey to track down.

"You no longer have to be near the crime scene. You can be anywhere in the world and be disruptive to systems," he said.