You see the news and the big brands under fire. Cyber incidents, breaches, and privacy issues are happening more than we know, and to companies just like yours. The most vulnerable companies aren’t just the largest and most well-known; but the ones with the weakest defenses, no matter the size.
More high-profile scenarios such as the Target and Neiman Marcus breaches have brought significant attention to the issue of cyber security and liability. But it’s important to understand that cyber security risks don’t just affect retailers; cyber risks pose a true threat to the real estate industry, with human error still at the root of many incidents.
Real estate firms are affected by this trend. Property managers, brokers/agents, title agents, developers, appraisers, multi-service real estate firms, and others may have significant amounts of confidential third-party information, either in the form of personally identifiable information (PII) or confidential corporate information.
Real Estate Investment Trusts (REITs) own, and in most cases, operate income producing real estate. Some REITs also engage in financing real estate. Depending on the REIT structure (public or private), and type of investor (individual, corporation, etc.) information is held electronically or in hard copy by these trusts, and can include tax records, federal identification numbers, social security numbers and other confidential information.
How else can those in the real estate industry be affected by Cyber Security risks? According to the American International Group (AIG) Cyber and Data Security Risks and the Real Estate Industry Report, in March 2012, the Massachusetts Attorney General fined a property management firm $15,000 after a company laptop containing unencrypted personal information was stolen. In another situation later in 2012, two individuals were found to be running a massive identity theft ring in San Diego where much of the personal information was believed to have come from stolen real estate files.
Although an appropriate Cyber Security Risk Management plan can help you, your tenants and investors financially recover from a cyber incident, it’s best to understand the exposures your organization faces in order to help avoid and mitigate future loss. Data breaches can not only be financially devastating, but can cause real estate developers to suffer from a damage to their reputation due to the lack of trust that will exist after the breach.
Click to view more on Cyber Risk from Oswald, as well as view and download our infographic: Cyber Attacks on the Rise | Don’t Get Caught in the Crosshairs.
Oswald’s Real Estate Practice currently insures over 90 million square feet of commercial space, and over 85 thousand units nationwide. We work with Real Estate Developers, Owners, and Operators of all real estate asset classes to structure risk management and insurance programs that uniquely meet your needs and help support company initiatives. Our Real Estate Team comprises of over 25 professionals offering varying degrees of expertise towards risk management consulting that goes above and beyond brokerage. Please contact us about our complimentary benchmark analysis of your current program.
To learn more about this program as well as our Privacy and Network Security Services, contact: