Client Privacy Matters
Client Privacy Matters
At a closing I attended recently, an attorney turned to his client, a young woman, and gave her a privacy statement to sign. The statement assured her that he wouldn’t use her personal information for commercial purposes.
I’ve worked with this attorney on a lot of closings and have seen the statement before. What was new this time was the client’s reaction—she clearly recognized the value of the statement in helping ensure her personal information stayed private.
Privacy is a hot topic. There are literally hundreds of privacy bills wending their way through our state legislatures. Thanks to a new federal law, the Health Insurance Portability and Accountability Act, we’re all signing privacy statements when we pay a visit to our doctor, dentist, or pharmacist. And there’s likely more federal legislation on the way.
Whether any of that future legislation affects our industry is up to us. Privacy is an issue that every real estate business needs to address. Why? In a word, trust. Our clients and customers expect that the information they give us will be used to market or manage their property or to help them find a suitable property. Period. Yet in this age of broad marketing alliances and Internet information sharing, it’s becoming more difficult to control the flow of data. It’s critical that we as individuals recognize the value of our intellectual property—the data “store” of our company—and the importance of protecting it.
Those of us who list and sell properties gather and create a lot of information in connection with a transaction. Many vendors would love to get their hands on it to make money off of it. Consumers must trust that the salesperson to whom they provide personal or property information will protect what’s confidential and use the balance of the data in an appropriate fashion that’s consistent with promoting their best interests.
In order to ensure that consumers continue to place their trust in us, we all need to evaluate our business practices. First, we need to be aware of exactly what data is being collected within our company and with whom it’s being shared. Second, we need to look at how our data is transmitted, both internally and with our business partners, to ensure there are no leaks that would allow it to be accessed inappropriately. And third, we need rules for what others—the newspapers and magazines in which we advertise, the lenders we work with, the title companies that close our sales—are permitted to do with the data. Without such rules, there’s nothing standing in the way of another company taking our data, mining it, and selling it. If there are legitimate commercial uses of the data—consistent with consumer privacy interests—we need to spell out both how we inform our customers and who should benefit financially.
NAR is now researching the technology and standards that exist and expects to publish best practices on all three levels of data protection. I urge all brokers and salespeople to watch for publication of these best practices and to embrace them.
If we don’t act responsibly with our data, we’ll lose consumers’ trust, and legislative bodies may choose to step in and impose limitations on our industry. Let’s do the right thing now—and preserve the trust we’ve worked so hard to earn.
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