But if you outsource your IT work to India (or to someone who subcontracts it to India), you have no such recourse. What are you going to do if they steal it? Sue them? Have them jailed? Good luck with that.
You are missing the point here. Outsourcing != offshoring.
And wherever you send your work, withing the country or to India (as an example), you can have legal safeguards and protection.
I remember a fraud case 3/4 years ago, where a couple of Citibank customers were embezzled by a Citibank call center. The Indian Cyber Police (yes, they have a special unit dealing with cyber crime) nabbed the 2-3 Indians involved in the act and recovered the money.
Nothing happened in US, and the US call center presumably hushed it up.
However, the main point the author is making is different - he is questioning how he can trust a person/team which is working unsupervised.