Cybersecurity threats and HOAs: 10 ways to safeguard your data
Condo and homeowners association (HOA) boards oversee many aspects of property management, and one of their crucial responsibilities involves data security. Thanks to our ever-increasing reliance on digital technology, protecting your association from cybersecurity threats (also known as cyberthreats) is more important than ever. A cybersecurity attack such as a data security breach can wreak havoc on an association, exposing sensitive details like emails, addresses, credit card information, etc. This can result in a cascade of problems, ultimately causing financial losses for the association and its members. As a board member, you must protect your association's data from cybersecurity threats. Learning about some of the most common online threats is a great place to start.
Potential cybersecurity threats
The most common threats that organizations face include phishing attacks, ransomware, and data breaches. And as technology advances, these threats have become more prevalent and sophisticated. Let’s examine them below.
Phishing attacks are one of the most common cybersecurity risks that condos and HOAs face. These attacks involve using carefully crafted emails and websites to deceive victims into providing sensitive information such as login credentials or other personal data. An example of a phishing attack is when an attacker sends a fraudulent email posing as a reputable entity. This could be a bank or a popular online service. The email is persuasive, often creating an urgency, and usually includes links or attachments. The recipient is deceived into clicking the link or opening the attachment, which leads to a fake website designed to steal data from the recipient.
Ransomware is another form of cyberattack that condos and HOAs should guard against. In a ransomware attack, cybercriminals encrypt files on an organization's network and demand payment for the decryption key. The cybercriminals promise to unlock encrypted files once the ransom is paid. This could lead to unauthorized access to HOA data such as email addresses, bank account numbers, and social security numbers.
Data breaches occur when individuals without authorization gain access to sensitive or confidential information without permission. This can occur through various means, such as hacking into computer systems, exploiting software vulnerabilities, or physically stealing devices (such as laptops) containing sensitive HOA data. Associations store a wide range of personal information, including residents' full names, phone numbers, email addresses, and payment information. This information can be used for identity theft, credit card fraud, and other financial crimes if it lands in the wrong hands. And the impact of such a breach extends beyond monetary losses and legal repercussions. Compromised personal information can also affect a person's emotional and psychological well-being.
The repercussions of a phishing attack, ransomware attack or a HOA data breach can result in a breakdown of trust in an association’s governance and financial management. It can also lead to legal disputes, damaging the association's reputation. Fear not, there are proactive measures you can adopt to guard against cyberattacks. It all starts with a risk assessment.
Perform a risk assessment
Has your association been assessed for its vulnerability to cyberattacks? Assessing your risk and vulnerabilities involves thoroughly evaluating your association's digital infrastructure. It also involves examining your network for potential entry points to identify loopholes and weaknesses. By undertaking a comprehensive evaluation and following the 10 recommendations below, boards can gain insights into their risk levels and take proactive measures to protect against cyberthreats.
1. Develop a robust cybersecurity policy
Establishing a robust cybersecurity policy involves defining and categorizing the information your association manages, such as sensitive data, intellectual property, and other critical information. The policy should include protocols for securing your organization's network, firewalls, intrusion detection and prevention systems, and regular monitoring of unusual activities. Including these components will help to protect against potential cyberthreats and enhance your association's overall resistance.
Read Association Policy: Why Communication is Key for information about how to develop and enforce good association policy.
2. Implement access controls
Data security begins with managing and restricting access to the data itself. Board members typically have access to sensitive association data. However, committee members, for example, should only have access to data relevant to their role or position. Access privileges should be assigned on a need-to-know basis and immediately removed once the position has been vacated.
3. Educate your staff
Is your team well-informed about cybersecurity risks? Are they aware of ways to spot phishing emails and how to handle them? Do they know how to respond to a ransomware attack? Consider conducting cybersecurity awareness training to educate board members and staff about cybersecurity threats. Password management, malware, and data breaches should all be covered in training. Providing your staff with comprehensive risk information enhances their ability to identify threats and respond appropriately.
4. Work with a professional management company
A good management company implements robust policies and protocols to ensure the security, confidentiality, and integrity of homeowners' sensitive information.
“FirstService has adopted the NIST (National Institute of Standards and Technology) cybersecurity framework,” said Chris Cady, vice president of IT Security at FirstService Residential. “NIST provides a set of guidelines, best practices, and standards designed to help organizations manage and improve cybersecurity risk. We also work to keep our teams up-to-date on the latest data security trends allowing us to empower boards with the knowledge necessary to safeguard their data effectively. This proactive approach aligns with our dedication and commitment to safeguarding the data of the communities in our care.”
It is important to note that FirstService’s policies and standards pertain exclusively to data stored on its company servers. Your association should establish its policies and procedures and engage third-party IT vendors to protect your association's data.
5. Secure your Wi-Fi network
Secure your condo or HOA's Wi-Fi network with unique passwords and strong encryption. Encryption ensures that unauthorized individuals cannot easily decipher or manipulate data, even if it is intercepted.
6. Regularly Back Up Critical Data
Frequent backups of critical data enable quick recovery from security incidents like ransomware attacks or data breaches.
7. Use robust passwords
To protect against cyberattacks, you must use robust passwords. A robust password comprises uppercase and lowercase letters, numbers, and special characters.
This complexity makes it significantly harder for attackers to guess or crack passwords using automated tools or brute-force attacks, a method employed by cybercriminals to gain unauthorized access to a system or account by systematically trying all possible combinations of passwords or encryption keys until the correct one is found.
8. Use Multi-Factor Authentication
Multi-factor authentication (MFA) is a security system that requires various forms of identification from an individual to grant access to an application, device or system. MFA enhances security by adding an extra layer of protection beyond just a username and password.
9. Make regular software updates
Updates, often released by software vendors, often introduce new security features or enhance existing ones. These features are designed to better protect your system against evolving cyberthreats and provide additional layers of defense.
10. Consider purchasing cyber security insurance
Cybersecurity insurance (also known as cyber liability insurance) provides organizations with coverage options to minimize financial losses related to cyber incidents and data breaches.
"Cybersecurity insurance is a critical component of any comprehensive risk management strategy in today's digitally driven landscape,” said Jeff Musselman, vice president at FirstService Residential. “As cyber threats evolve and become even more sophisticated, associations must take proactive measures to protect themselves from potential liabilities and financial losses.”
Some associations may have coverage under their directors' and officers' insurance policies. Cyberattacks, however, pose unique risks and are complex, so securing a separate, standalone policy is recommended for those without coverage.
Lowering the risk that your condo or HOA experiences cyberattacks requires a proactive and comprehensive approach. Implementing the 10 measures above can significantly enhance your association's resilience against cyberattacks, your operation's integrity, and your residents' trust.
If your association needs a reputable IT vendor, contact FirstService Residential for assistance.