Jan. 28 is Data Privacy Day, as set by the National Cyber Security Alliance’s (NCSA) Data Privacy Day campaign. The NCSA provides various resources on its website, including instructions on how businesses can protect themselves, detect fraud, respond quickly and recover if they have fallen victim.
How do these translate into real estate best practices?
Protect
The NCSA recommends that businesses keep software current, ensure updates are set to automatically install, implement stronger authentication processes, back up all information either in the cloud or on a hard drive, limit access to sensitive data and stay vigilant.
For real estate agents and brokers, that means keeping vulnerable data, such as transaction paperwork with client signatures, protected by double verification, as well as backed up to a secure location. Platforms such as DocuSign and ShelterZoom are helping to make transactions more secure in real estate by using technology such as encryption and blockchain.
According to Chen Konfino, chief executive of Younity, an app that allows users to remotely access their digital files from their computers using their mobile devices, who was interviewed by the New York Times, individuals can also protect themselves by using a VPN (virtual private network) on their device, which will encrypt their traffic and block emails from being intercepted.
Detect
Knowing what to look for is the first step. According to the NCSA, businesses should pay attention to any unusual requests, especially though email, that direct them to click unknown links or open suspect attachments. Brokerages can reduce the chance of fraud by implementing office-wide training sessions that teach agents how to detect scams, proceed safely and safeguard their information.
Respond
If an individual suspects fraud, what is the appropriate course of action? The NCSA recommends that they disconnect any computers that may have been compromised and bring in an IT team to take a look. Additionally, if widespread and severe enough, they should also contact law enforcement and retain legal counsel.
Due to the nature of real estate, in which brokerages can have hundreds of agents across multiple offices, any individuals who suspect fraud should immediately notify their broker so they can ensure the breach is not extensive.
Scams to Look Out For
According to the New York Times, the FBI has reported 3,766 instances of real estate scams between October 2014 and October 2019, with losses reaching nearly $339 million.
The best way to protect data? Know what the scams are. In 2019, several REALTORS® reported receiving texts and phone calls from 800-874-6500—the toll-free number for the National Association of REALTORS® (NAR). However, NAR reported it was not making these calls and they were fraudulent.
Scams happen often on the consumer side, as well. REALTORS® should educate their clients about the most common types of fraud they may encounter, which can include:
- Wire transfer requests via email – All requests should be confirmed by the agent or attorney, in person or by phone.
- Illegitimate rental or for-sale listings for which the “landlord” or “seller” requests payment upfront, such as a security deposit or down payment. These fraudsters often claim to require these deposits in advance and then disappear with the money.
- Emails asking for sensitive information – Consumers should look for warning signs such as grammar and spelling errors, suspicious email addresses and phone numbers or addresses in their signature that cannot be verified.
Several organizations are taking the lead on fraud prevention in real estate. For example, Title Resource Group (TRG) recently launched a campaign, in the form of a game, to help educate agents and consumers about fraud.
NAR provides a Data Security and Privacy Toolkit to help educate industry professionals about how to protect their data and comply with legal requirements. The toolkit includes state law information and any pending federal regulations on the subject of data security, as well as checklists for implementing a data security program.
Brokers and agents, share your experiences with us and let us know what you are doing to protect your data.
Liz Dominguez is RISMedia’s senior editor. Email her your real estate news ideas at ldominguez@rismedia.com.
