WATCH THE TRASH, FAX, AND PHONE IN NEW WORLD OF INDUSTRIAL ESPIONAGE

* According to the Business Espionge Controls and Countermeasures Association, the four faces of business espionage include:

* Electronic eavesdropping or bugging.

* Computer crimes.

* Pretext interviewing techniques.

* Undercover spy operations.

Countermeasures to combat these activities, says New Jersey security consultant Kevin Murray, include using:

* Paper shredders. "There's too much information that gets thrown into the garbage" which can be retrieved, he says.

* Quarterly inspection for eavesdropping devices.

* Encryption, alarm system, or access-control systems.

Harry Rasmussen, president and chief executive officer of Crest Industries Inc., says encryption, used to encode communication devices such as the telephone, facsimile, and computer, is increasing.

Many electronic eavesdropping devices transmit what they hear via radio waves. This breed of bug includes wireless microphones, tracking devices, video transmitters, and telephone and computer wiretaps.

According to guidelines issued by Murray Associates, "trashing" or "dumpster diving," refers to rifling through garbage in an effort to cull valuable information. It is considered to be the No. 1 method of industrial espionage. And by itself, it is legal. In 1988, the United States Supreme Court confirmed that there is no expectation of privacy, or ownership, once an item is left for garbage pickup.

Murray Associates also notes that encryption can be used to make communications unintelligible to uninvited listeners. It is available for most telephones (including cellular), facsimile machines, computers, and video transmissions.

Facsimile machines have been a boon to spies. They provide an ideal method of transmitting information to competitors. An internal spy does not have to photocopy documents or risk taking paperwork from the premises.

Industrial espionage experts advise that organizations using personal computers create a formal set of security procedures.