A Risky Business: Why Title Companies Must Prioritize Cybersecurity

Title companies play a critical role in the real estate industry, providing title insurance to protect property owners from potential legal and financial disputes.

However, with the increasing reliance on technology and digital processes, title companies face new challenges and risks in the form of cybersecurity threats.

In this blog, we will discuss the importance of cybersecurity for title companies and the steps they can take to protect themselves and their clients.

The Risks of Cybersecurity Threats for Title Companies

Title businesses process sensitive information, including personal and business information of clients. This information can be valuable to cybercriminals, who may try to steal it for fraudulent purposes.

The real estate industry increasingly relies on technology and digital systems to conduct business. While this has provided many benefits such as increased efficiency, significant cybersecurity threats can pose risks to the industry.

 Here are some common cyber threats in the real estate industry:

Phishing:

Phishing attacks are a common cyber threat that involves tricking individuals into divulging sensitive information such as login credentials.

Real estate professionals are often targeted with phishing scams that appear legitimate emails from clients, colleagues, or vendors.

Ransomware:

Ransomware that encrypts files and demands payment for the decryption key is the same as malware. Real estate companies are attractive targets for ransomware attacks due to the sensitive nature of their data and the potential financial gain for attackers.

Business Email Compromise (BEC):

BEC attacks involve compromising a business email account to impersonate an employee or executive in order to trick another employee into transferring money or sensitive information. Inside many real estate dealings, vast amounts of money are involved, making them a prime target for BEC hacks.

Data breaches occur when a cybercriminal gains unauthorized access to sensitive data. Data breaches in the real estate industry can occur when personal, financial, or property information is stolen.

Third-party Vendor Risk:

Real estate companies often work with third-party vendors to conduct business.

However, these vendors can also pose a cybersecurity risk if they are not properly vetted or do not have adequate security measures in place.

Real estate companies should implement strong cybersecurity policies and procedures to mitigate these threats, provide regular employee training on cybersecurity best practices, and ensure that all software and systems are up-to-date and patched against known vulnerabilities.

Cyberattacks should regularly be investigated to determine whether there are weak points in the security system. Cyberattacks can cause great financial loss for a business. A business’s reputation may suffer if a company experiences a cyberattack.

Cybersecurity breaches can also lead to legal and regulatory penalties, depending on the nature of the breach and the data compromised.

The Importance of Cybersecurity for Title Companies

The importance of cybersecurity for title companies cannot be overstated.

Here are some reasons why:

Protecting Sensitive Information:

As mentioned earlier, title companies deal with sensitive information that must be protected.

By taking advantage of cybersecurity procedures, one can secure information that is stored on the system and prevent unauthorized data breaches.

Maintaining Client Trust:

Clients trust in title companies to protect their personal and financial information. A cybersecurity breach may cause a loss of clients and revenue. Maintaining strong cybersecurity measures can help reassure clients that their information is safe.

Complying with Regulations:

Title companies must comply with various regulations that govern data privacy and security, such as the Gramm-Leach-Bliley Act (GLBA) and the General Data Protection Regulation (GDPR).

Failing to adhere to these regulations often leads to legal and monetary penalties. Implementing robust cybersecurity measures can help ensure compliance with these regulations.

Steps Title Companies Can Take to Protect Themselves

Title companies can take several steps to protect themselves from cybersecurity threats.

Here are some best practices:

Employee Training:

Employees are often the first step to preventing cyber-crimes. Providing regular cybersecurity training can help employees identify and prevent cyber threats.

Implementing Strong Password Policies:

Passwords are the first defense against unauthorized access. Implementing strong password policies, such as using complex passwords and requiring regular password changes, can help prevent unauthorized access.

Backing Up Data:

Regularly backing up data can help ensure that critical information is not lost during a cyber-attack. It can also help quickly recover data in case of a ransomware attack.

Implementing Multi-Factor Authentication:

Multi-Factor Authentication (MFA) adds an extra layer of security to user accounts. By requiring users to provide additional authentication factors, such as a code sent to their mobile device, MFA can help ensure against unauthorized access of user accounts.

Regularly Updating Software:

Cybercriminals often exploit vulnerabilities in outdated software. Regularly updating software can help patch these vulnerabilities and prevent attacks.

The Bottom Line…

Production companies must protect clients and themselves from cyber threats that come with the title industry. By implementing best practices, title companies can reduce the risk of cybersecurity breaches and maintain their clients’ trust.