"It is imperative that everyone in the property sector is aware of the dangers and takes all reasonable precautions to ensure not only their agency, but the technology they use is secure and able to assist them in preventing these attacks on their businesses"
- Neil Cobbold - PayProp UK
Businesses in the property sector have been urged to be extra vigilant to avert the growing threat of cybersecurity breaches.
Neil Cobbold, managing director of client accounting and automated rental payment specialists, PayProp UK, issued his warning following a report by the National Cyber Security Centre which suggested that the growing use of AI will almost certainly make cybercrime more common and more dangerous.
The report, issued last month, warns: “AI is already being used in malicious cyber activity and will almost certainly increase the volume and impact of cyber-attacks – including ransomware – in the near term.”
Among other conclusions, the report suggests that by lowering the barrier of entry for novice cybercriminals, hackers-for-hire and hacktivists, “AI enables relatively unskilled threat actors to carry out more effective access and information-gathering operations.
“This enhanced access, combined with the improved targeting of victims afforded by AI, will contribute to the global ransomware threat in the next two years.”
Aware of the dangers
The property sector has undergone a digital revolution in recent years – it is estimated that the PropTech market will grow from a current valuation of £14.4bn to £68.3bn by 2032.
But the increased reliance on PropTech could make industry operators more vulnerable if they do not check a provider's security, cyber insurance and disaster recovery plans, amply demonstrated at the end of last year when legal infrastructure provider, CTS, suffered a cyber attack that impacted property sales and completions. Almost 100 conveyancers and law firms were said to have been affected.
Cobbold said: “It is imperative that everyone in the property sector is aware of the dangers and takes all reasonable precautions to ensure not only their agency, but the technology they use is secure and able to assist them in preventing these attacks on their businesses.
“With the rise of AI it has never been easier for criminals to impersonate an agency, tenant or landlord. While these attacks can come from organised criminal gangs who are targeting large listed companies, independent agencies on the high street must also protect themselves against cyber threats.
“The property sector holds financial transaction data as well as personal and financial information making it a target for malicious threats that could come from inside or outside the business, perhaps in the form of a disgruntled employee.
He adds: “Rental scams are also on the rise. According to data from Action Fraud, the UK’s national reporting centre for fraud and cybercrime, there was a 23% increase in reported cases of rental fraud from 2021 to 2022, averaging 15 cases a day in 2022, a number that has likely increased.
Managing the risk
“If fraud takes place and your tenants pay money to someone impersonating you and your bank account, you’re at the mercy of the banks to try to get the rent back.
“Most agents will hold specific insurance policies, including client money protection scheme membership, but having to claim on these policies will dramatically increase the cost of doing business.”
Increasingly, the most security-conscious agencies are going further than just insuring the risk.
Cobbold explains: “Bank-integrated PropTech gives agencies the tools they need to combat cyber crime. Using technology that limits who can reconcile rent, requires dual approval to pay out client funds, alerts agents when bank details are changed and automates statements and invoices, significantly enhances protection by ensuring all parties are kept fully informed and no one person can collect or pay out client money without approval.
He concludes: “But what we can all see from the warnings and predictions is that enhanced cyber security must become a way of life for all businesses, large and small.”