Last modified on February 21st, 2024
By Elizabeth Millar, Rae Parker

In today’s world, property management businesses are required to store much more data than in the past and are more dependent on that data to run their operations. Because the technology your business uses to collect and store data plays an important role, it’s imperative that you have a trusted software partner that is savvy and stays ahead of bad actors by proactively implementing security measures. 

Hackers would love to get their hands on the sensitive financial information property management companies collect from renters, owners, and vendors. This can include bank account details, Social Security numbers, and more. The mishandling of this data can lead to a number of problems, such as financial losses, legal issues, and reputational damage. In our 2024 AppFolio Property Manager Benchmark Report, we surveyed more than 5,000 United States-based property management professionals to understand what trends within the industry are top of mind. As it relates to data security and fraud, 44% of respondents said they were more concerned about data security this year, compared to 25% last year. With society rapidly becoming more digitally advanced, AppFolio knows and understands the responsibility of ensuring our customers and their communities feel protected and confident with their data practices.

To protect your property management business’s data, you must be familiar with common risks and best practices to reduce your vulnerability. By understanding the common risks associated with fraud and data theft and implementing best practices for protecting digital assets, you can reduce the chances of an attack on your business’s sensitive information. 

While this article contains helpful information, we are not providing legal advice, and you should be sure to consult a qualified attorney for any specific questions about protecting the data and digital assets of your business.

Common Threats To Be Aware Of

As digital technology evolves, so does the threat of data theft and other malicious attacks. Property management companies can be attractive targets because they store key information that hackers are after, including client and customer payment information. Below are ways in which your business could become vulnerable to breaches:

Phishing Scams

Phishing scams are a common tactic hackers use to trick individuals into providing sensitive information. Typically, phishing attempts involve emails from a sender that may seem legitimate, asking you to click on a link, share a password, or download a file in an attempt to steal your personal data. Despite email providers’ improvement in detecting phishing messages, hackers have resorted to alternatives such as social media, text messaging, and phone calls to gain access to your sensitive personal and financial information. 

Ransomware

Hackers may use ransomware (malicious software) to attack a network and demand payment in exchange for ceasing their activity, restoring access to the system, or preventing the release of stolen information. This breach can occur when an email with a malicious file is sent from a common or similar name as a partner, vendor, or coworker. Once the email is opened and action has been taken, the hacker has access to and control over your company’s systems and can use your data as leverage to release sensitive information unless a ransom is paid.

Human Error

Simple yet costly mistakes made by employees can contribute to data breaches. Verizon’s 2023 Data Breach Investigations Report found that 74% of data breaches involved a human element, which includes social engineering attacks, errors, or misuse. Other common types of human error data breaches result from stolen credentials or employees failing to adhere to established company cybersecurity measures.

Best Practices To Follow

Complacency is almost as dangerous as putting out a sign that your data is available. To keep your business and assets safe, here are some best practices to consider implementing:

Provide Employee Training

Ensure employees are fully educated on how to spot phishing and ransomware attacks. One way to do so is by providing consistent training that gives employees the tools to identify common data threats, understand the risks they pose to your organization, and respond if one occurs. Additionally, check with your property management software provider for training resources — AppFolio offers customers self-serve resources such as live sessions, self-directed guides, and help articles on a wide range of topics.   

Ensure Proper Data Storage

Be sure to schedule regular backups of your data — either manually or with automated backup tools. Encourage employees not to store password lists, financial data, and other sensitive information in their email or shared drive storage. It’s always smart to use strong and unique passwords and avoid sharing them with colleagues or writing them down to prevent wandering eyes. 

Choose A Reliable Property Management Software Provider

Having a reliable property management software provider that can help you manage your data safely and securely is paramount and an important factor to consider when evaluating your current or new provider. When it comes to securing and protecting your financial data, AppFolio Property Manager takes this responsibility seriously and runs in a state-of-the-art data center and network, ensuring the highest levels of security available today. We also offer payment solutions for residents that prioritize security when making payments. Our accounting system allows you to set custom user permissions for specific users with the right level of access. Additionally, we make significant investments to protect your business from risk by monitoring transactions in real time with protections in place in case of anomalous/suspicious behavior and have mandatory two-factor authentication for all user types. 

Our industry has changed significantly within the last decade, and in order for your business to thrive, there is no room to forfeit revenue or resources due to fraud incidents. With the right security measures in place, you can protect your business from costly cybersecurity incidents and maintain peace of mind when it comes to protecting your digital assets.

Here at AppFolio, we are a technology partner that values security for all customers and are there for you should fraudulent situations arise. Our 2024 Property Management Benchmark Report contains additional insights around industry data security trends and prevention techniques. In the meantime, by following these best practices and investing in cybersecurity solutions, property managers can ensure the safety of their valuable data and reduce the chances of becoming a target for malicious attacks. For more ways you can reduce risk and optimize your accounting operations, download our free guide below.