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Counting the cost of cyber crime

19 August 2016

The impact of a cyber security breach can be crippling for your business. Don’t make the mistake of thinking it can’t happen to you.

By Nancy Rainbird

Cyber security breaches have been big news over the last few years. It seems barely a day goes by where the media isn’t reporting yet another major hack somewhere in the world. It’s all too easy to think the potential for a cyber security breach in your business is a distant threat. But it’s not. 
Every real estate business uses digital technology; it plays a significant role in how agencies operate, and falling victim to a hack can have serious ramifications. Amongst other things, a cyber security breach can cause significant damage to your business’s revenue and reputation. 

One of the downsides to embracing technology is the risk of having your data stolen, with an estimated one in five Australian businesses hacked every year. Agencies keep a huge amount of important information about their clients, including bank details, passport numbers and employment records. Unfortunately these details are at risk of being stolen, which could cause your business to lose revenue and be held liable to heavy fines and lawsuits. 

Recently, an agency in Broome in Western Australia had $50,000 stolen by cyber fraudsters, who gained access to their online banking system after a compromised email installed malicious software. This software allowed the fraudsters to change the bank account details of one of the agency’s clients who received regular payments. It re-directed the payments to another account, before reverting back to the original account details in order to avoid detection. 

As a result of this fraud, the WA Consumer Protection Commissioner recommended that real estate and settlement agents manually input bank account details of clients when making electronic bank payments, rather than relying on the accuracy of details in pre-entered lists. 

This theft is interesting as it could in some circumstances result in a professional indemnity claim. It could also potentially result in a cyber claim, which is covered separately. 

Some professional indemnity insurance policies offer limited cover against cyber crime. There are also stand-alone cyber insurance policies available in the market. As this is a developing exposure, due to the rapid rate at which technology is developing, each agency should seek advice from an insurance advisor and consider which policy best suits their needs based on the protection they have in place. 

The Australian Government has said cyber security is one of its security priorities and launched a Cyber Security Strategy this year which was developed after over 18 months of consultation with over 190 organisations. 

The government will spend $230 million on a range of measures and if they are prepared to spend that much money, isn’t it wise for your business to invest in protection too?

While care has been taken in preparing this article, and the information in it has been obtained from sources that Realcover believe to be reliable, Realcover does not warrant, represent or guarantee the accuracy, adequacy, completeness or fitness for any purpose that the article may be used. Realcover accepts no liability for any loss or damage (whether caused by negligence or not) resulting from the use of this article.

The Australian Cybercrime Online Reporting Network (ACORN) is a national online system that allows you to securely report instances of cyber crime. 

It also provides advice to help people recognise and avoid common falling to cyber crime. This includes ensuring your computer and other devices, such as phones and tablets, are protected from possible cyber crime attacks by using a firewall to block unauthorised access. You should also use up-to-date anti-virus software, a pop-up advertising blocker on your internet browser, different passwords on different sites, and secure your wireless network. 

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