A member of the Real Estate Institute of New South Wales (REINSW) has warned property managers to be on their guard against email fraud after falling victim to one such scam.
The member explained how he’d been defrauded of nearly $1,500 after receiving a request by email from a landlord to change the bank details. The member eventually discovered that the landlord had not sent the email nor signed the forms to update it—but only after the bank details had been updated and the rent paid to the new account.
The REINSW member, who did not want to be named while police investigations were ongoing, explained: “The request came from the same email address we had on our records for the landlord, and so our bookkeeper replied asking them to fill in a request form, including their signatures, before we could update it.
“Once they returned this, we checked their signatures against our management agency papers and they matched. Even the police who we later showed said it was a good forgery.
“Our protocol has always been that changes to bank details must be in writing, but we are now also making phone calls to the landlord.”
REINSW’s Property Management Chapter Committee will be discussing best practice measures to stop these scams at its next meeting.
Professional indemnity insurer Realcover says that since real estate businesses overwhelmingly rely on digital technology, many have become extremely susceptible to cyber-attacks.
One real estate agency in Broome had $50,000 stolen by cyber fraudsters. The cyber fraudsters gained access to the agency’s online banking system after a compromised email installed malicious software.
To safeguard against similar attacks, the WA Consumer Protection Commissioner recommended that real estate and settlement agents manually encode bank account details of clients when making electronic bank payments, rather than relying on the accuracy of details in pre-entered lists.
“Some professional indemnity insurance policies offer limited cover against cybercrime,” said Nancy Rainbird, claims and compliance manager at Realcover.
“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.”
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