Use Your IT Stack to Combat Fraud
Some say the only constant in life is change. When it comes to real estate transactions, it seems there is one other constant: the potential for fraud. Given how widespread and persistent this problem is, title agencies can’t leave any stone unturned when it comes to fraud prevention. They must take a hard look at their operations to understand where they might be vulnerable, and that includes their IT stack. Let’s review how you can make sure your technology systems benefit your anti-fraud efforts.
The pros and cons of a connected world
Our ever-digitalizing world has led to unprecedented productivity gains. Yet, it has also paradoxically made key processes like fraud prevention more difficult to manage. Several factors contribute to this. For one thing, modern title agencies have many more attack vectors than they once did. For another, modern criminals have adopted advanced methods to carry out their schemes, such as phishing, e-signature exploitation and synthetic identities. These threats make it more important than ever to ensure your tech stack is built to deter fraud.
Multi-factor authentication
One of the best ways to prevent fraud with your tech stack is through a simple and straightforward technique: Multi-factor authentication (MFA) is a security mechanism with which you are likely already familiar. In fact, I would be willing to bet you have an entire text chain made up of confirmation codes for various online accounts. MFA offers a critical layer of security by requiring an extra sign-in step for sensitive digital platforms.
When your systems are equipped with MFA, bad actors will be unable to authenticate themselves, even if they have the correct login credentials. New advances like dynamic MFA further harden your security perimeter by verifying that stakeholders are located where they say they are.
Here are some important best practices when using MFA:
- Implement and require MFA on all systems that deal with client, financial and/or property data.
- Also, require it for mission-critical transactions or changes to any important system settings.
- Remember, MFA is not a set-it-and-forget-it scenario. Staff must be continually educated, and new MFA technology updates should be implemented as soon as they become available.
Establish comprehensive encryption
Beyond MFA, there are several other ways to create a more secure tech stack. One of the most important is encryption. Utilizing strong encryption is a proven security method that serves as a protective barrier between your company’s mission-critical data and unauthorized user access. To maximize its benefits, sensitive files should be encrypted when they are both “at rest” and “in transit.” Here’s what that means:
- Data “at rest”: Data that is “at rest” simply means data that is stored in a single location. This can include both physical locations like hard drives or USBs and digital ones like cloud storage servers or databases.
- Data “in transit”: Data that is “in transit” refers to data that is moving from one device or storage location to another. Some examples include, but are not limited to, emails, file transfers, instant messages, video calls, online transactions, or VoIP.
Encryption brings significant security benefits in each scenario. When data is at rest, encryption ensures that it remains unreadable even if the physical or digital location is compromised. Similarly, encrypted data in transit cannot be intercepted or used for nefarious purposes without the interceptor possessing the decryption key.
There are several best practices to consider when implementing encryption:
- Use strong encryption algorithms like the Advanced Encryption Standard (AES).
- Properly secure your decryption keys.
- Encrypt both active and backup files.
- Deploy encrypted communication methods, particularly when communicating with parties outside of your network.
- Conduct regular audits and training to ensure compliance with industry regulations and standards.
Other security measures you need to know
While MFA and encryption are two important pieces of your security puzzle, they are also just the tip of the iceberg if you want a security stack that can truly keep fraudsters at bay. Creating a “cybersecure culture,” putting together a disaster recovery plan and availing yourself of new security solutions like endpoint threat detection are all important parts of a comprehensive security approach.
Final thoughts Ever-increasing digitalization in the workplace has been both a blessing and a curse. Each new gain in productivity and profitability has also brought new concerns about security and stability. Yet, we are not without options. While it’s impossible to make tech stacks completely immune from fraud, strategies like MFA and encryption can help you enjoy more of technology’s advantages while minimizing its risks.
Tags: authentication, crime, cybersecurity, escrow security, fraud