Current litigation and industry awareness around BEC and spoofing have increased tremendously. Not too long ago, victims of cyber fraud were the only ones held liable for what happened to them. If they had their identity or money stolen, it was their fault for “failing to prevent this from happening.”
That was until one court case changed everything…
The court case that changed everything
In February 2016, a buyer agreed to purchase a home in Kansas City, Missouri. Before closing the deal, a cybercriminal got a hold of the closing statement. They found an email of someone from the title company with the correct wiring information.
So they switched the wiring instructions with their own. They created a fake email address that looked exactly like the title company. To make it as real as possible, they used the same logo, signature block, and text formatting, then emailed the fake wiring instructions to the victim.
On April 24, 2018, the jury found the real estate agent and real estate broker liable to the buyer because they failed to protect them.
They call this fraud BEC (business email compromise) and spoofing. It’s when cybercriminals disguise themselves as a reputable person in the transaction network.
They prey on human psychology and tailor their message to the recipient to make it look as real as possible. The person receiving the email doesn’t realize it, sends their information over and loses their funds.
Companies need to keep themselves, their shareholders and their customers safe. This court case sent a clear message to the people involved in a real estate transaction. It set a new standard in the industry:
Everyone in the transaction network needs to protect themselves and each other.
Before the case, there were no clear boundaries of liability for those who lost money in a cyber fraud.
We never knew whose fault it was.
Was it the buyer’s fault?
The title insurance company?
The real estate broker?
The real estate agent?
And although it’s hard to know exactly who was responsible, they made one thing clear:
Cyber fraud is everyone’s risk during a transaction.
So everybody needs to have a prevention method in place to keep everyone in the deal safe.
And here’s a secret:
The market will now reward companies that prevent cyber fraud
Today, nobody will do a deal with a business that doesn’t have an identity management system in place. That’s because trust has become the biggest differentiator.
Everybody knows of the damages that come when their peers fail to protect themselves.
From now on, everybody in the transaction network is working together. There is a new level of transparency, where companies cooperate with each other, review their partner’s systems and make sure that they’re all on the same page.
The business who can prove to their customers that they are safe will be the one who stands out in the marketplace. That’s why it’s so important to create an identity management system:
To prove that your business can be trusted.
This is a simple process where only authorized users have access to company apps, programs, and data. The goal is to link the right people to the right information.
A lot of frauds happen because employees have access to more information than they need to do their jobs. When this occurs, it’s harder to control who has access to what. Everything gets messy and out of place, with data wandering around places it shouldn’t be.
As a result, this widens up the gap for cybercriminals. It allows them to target more people inside a company whom they can steal sensitive information from.
Another problem we see is that without a system in place, as soon as you think you’ve handled a specific threat, a “new” and “improved” version shows up.
Fraudsters will wait for someone to make a mistake and then attack them through unsophisticated schemes that don’t require any technical “know-how.”
An identity management system makes it much harder for cybercriminals to exploit the weakest link in a deal.
So what does this mean for your business?
People need to trust each other.
And CertifID is trying to restore that trust in transactions.
We want to help you focus on the customer experience rather than worry about fraud.
Our software does all the hard work for you and confirms that you are exchanging information with the right person in a transaction.
So if you want to take the pressure out of the deal, click here to request a free demo.
We’ll be happy to show you how to keep your business and customers safe.