The Internet has revolutionized so much of how we conduct business, especially real estate. The National Association of Realtors (NAR) recently reported that over 90 percent of real estate firms have websites and that 43 percent of buyers begin their search for a new home on the web. These conveniences do not come without risk, though. With more real estate business moving online, more of the smaller agencies in the industry have found themselves to be the victims of cyber hacks, subjecting their clients to the dangers of identity theft.
According to Risk Management panelists at the 2015 Realtors Conference and Expo, small real estate businesses and their clients are rapidly becoming the targets of online scams. Because smaller real estate businesses often lack in technology and legal teams that are typically part of larger companies, they account for most of the cyber attacks in the real estate industry.
“Small businesses need to pay just as much attention as large companies to possible cyber threats,” said Melanie Wyne of the NAR.
According to Darity Wesley, the founder of the Lotus Law Center, hackers are always looking for data that can help them steal a person’s identity, such as credit card or bank account information, Social Security Number, employment details, address and phone number. All of these could be found in a real estate agency’s online database or in transaction details.
Wyne explained that when data breaches can typically harm real estate agencies in three different ways. Businesses can suffer financially when they need to spend money to rectify damages from the hacks. They can also suffer legally if those affected by the hack decide to take out lawsuits. Small real estate companies also tend to suffer in their reputation, when word of the hack gets around, and they can lose business because of it.
Jessica Edgerton, a NAR associate, reported that one of the most recent scams frequently targeting real estate companies is a wire scam. In this scam, a hacker will break into an agent’s email and figure out the details of upcoming real estate transactions. The hacker will then pose as the agent and email the clients near closing time, requesting that the buyer wire funds. Edgerton recommends that agents notify their buyers of this scam and ask them to call on the phone if they receive any such emails. For further protection, the NAR suggests that real estate agents familiarize themselves with data security and privacy laws.
With a lot of business processes moving onto the Internet, it’s important for companies to amend their security accordingly, especially smaller business who may not necessarily have access to the same resources as larger companies. Consumers should also be wary of who they conduct business with and withhold as much sensitive information as possible. For additional protection, you can invest in a credit monitoring service to notify you of certain activity that may indicate fraud. With this information, you’ll be better equipped to handle identity theft, whether you have to obtain a credit freeze or pursue damages related to your compromised identity.