REALTORS® Must Tell Clients of Data Breach

By Henry Lerner, Esq.

A REALTOR® records his client’s Social Security Number in nearly every transaction. As of June 20, 2006, anyone who stores any “personal information” linking the name of a Pennsylvania resident to his Social Security Number (SSN), driver’s license number (or other state-issued ID number) or financial account number is required to notify the individual when there has been a database breach of security.

Brokers and agents should review their procedures for collecting and storing client information to see if the act applies to their business, keeping in mind that the act covers any computerized data that meets the definition of “personal information.”  For example, if you fill in the SSN field that is provided on a cover sheet for any electronic forms vendor, you are covered under the act. Similarly, the BPINA would apply if you maintain scanned or electronic copies of W-9 tax forms or credit check authorizations.  It would even apply if you received an e-mail from a client in which they provide any of the items listed above.

Whether or not the Breach of Personal Information Notification Act (BPINA) affects your business, it is a good idea to review the security measures that protect your computerized data.  Is your computer protected by a password that isn’t easily guessed?  Have you ever checked a laptop instead of carrying it on the plane?  Do you take extra steps to completely delete data from old computers?  Although it is certainly important to install proper firewall and spyware software to protect your computer from internet hackers, it is just as important – if not more important – to take measures that physically protect the data.

Many PAR members received an update on this new law during the latest REALTOR® Risk Reduction Series Telephone Seminars in August.  If you were unable to attend that seminar, PAR has a number of resources available online at www.parealtor.org. Just click on the Data Security Resources under Quick Links section.

Available resources include a copy of the act, a detailed Q&A covering many of the most important aspects of the act and some suggestions on how to improve security of your computerized data. 

The Data Security Resources page also contains information about a related law – the Privacy of Social Security Numbers Act – which goes into effect in December, 2006.  More information about that law will be forthcoming in a future issue of The Pennsylvania REALTOR®.