In the last five years, there have been over 2 billion dollars of losses suffered by buyers and sellers of real estate as a result of cyberfraud. Frequently, the entry point into a transaction for fraudsters is the monitoring of agents’ electronic communications – after all, many agents do not have the resources to develop, implement and maintain a full cyberfraud prevention protocol, and a fraudster knows that an agent’s email is the best place to look for the details of several transactions. We here at Berlin Patten Ebling have long been proponents of strict cybersecurity practices, and have tried to educate the public about the specific dangers that the real estate industry faces from would-be fraudsters. In the past, you have heard us recommend that you use smart password management, be wary of email attachments and links, and watch out for certain tell-tale signs of fraudulent activity in the course of a transaction. While all of that advice still stands, we have decided to take our efforts to protect our transactional clients, and the agents who serve them, even further – welcome to the world of portals!
What is a portal? It is a central repository of information, and a fully-secured method of communication, to use in real estate transactions. Buyers and sellers will both have the ability to establish unique login credentials to access the portal for their transaction, and once those credentials are established they will have a one-stop-shop for uploading and receiving information. In addition to giving the participants in a transaction the ability to exchange documents, the portal will provide an encrypted channel for the exchange of emails with this firm.
One of the primary benefits of using a portal is the increased security that it provides. Many of the traditional methods that a fraudster uses to learn the details of a transaction, and to ultimately insert themselves into the transaction to conduct fraud, are no longer available to them. For instance, they cannot monitor email communications which they otherwise may be able to if they compromise an account, and they cannot provide fraudulent information to the participants in the transaction because they have no access to the portal. How does the portal manage to better secure transactions? The portal software’s vendor will use terms like “ISO/IEC 27001 Certification” and “ALTA Best Practices Pillar 3 for Security” that doesn’t mean a whole lot to the rest of the world. In short, though, they have designed a system for communication and data storage that is more secure than most individuals, and even many real estate industry professionals can manage.
So, no more worries about cybersecurity, right? Not quite. Although the use of portals will better harden users against attacks by fraudsters, we certainly continue to advise good cybersecurity practices. Strong passwords are still important; distrust of unexpected communications from unknown sources is still important; trusting your gut when something just feels “off” in a series of communications is still important. While we here at BPE are constantly upping our game to face the growing threat of cyberattacks, fraudsters are constantly upping their game as well. As long as everyone continues to maintain best practices, we can stay one step ahead.
Daniel C Guarnieri, Esq. firstname.lastname@example.org
Berlin Patten Ebling, PLLC
This communication is not intended to establish an attorney client relationship, and to the extent anything contained herein could be construed as legal advice or guidance, you are strongly encouraged to consult with your own attorney before relying upon any information contained herein.
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