What are the risks and consequences of losing or leaking tenant documents?

1 Legal liability

Losing or leaking tenant documents can expose you to legal liability for violating privacy laws, such as the Fair Credit Reporting Act (FCRA), the Fair and Accurate Credit Transactions Act (FACTA), and the General Data Protection Regulation (GDPR). These laws require you to safeguard tenant information and dispose of it securely when it is no longer needed. If you fail to do so, you could face lawsuits, fines, penalties, and reputational damage.

2 Identity theft

Losing or leaking tenant documents can also put your tenants at risk of identity theft, which is the fraudulent use of someone else's personal information for financial gain. Identity thieves can use tenant documents to open new accounts, apply for loans, file taxes, or commit other crimes in your tenants' names. This can cause serious harm to your tenants' credit scores, finances, and security. It can also damage your relationship with your tenants and make them lose trust in you.

3 Operational disruption

Losing or leaking tenant documents can also disrupt your operations and cause inefficiencies, delays, and errors. For example, if you lose a lease agreement, you may not be able to enforce its terms, collect rent, or resolve disputes. If you leak a maintenance request, you may not be able to prioritize it, assign it, or track it. If you lose or leak tenant documents, you may also have to spend time and money to recover, replace, or notify them.

4 Competitive disadvantage

Losing or leaking tenant documents can also give you a competitive disadvantage in the rental market. If your tenants or prospects find out that you are not careful with their information, they may choose to rent from someone else who is more trustworthy and professional. If your competitors find out that you are losing or leaking tenant documents, they may use it against you to attract more customers or lower your reputation.

5 Best practices

To reduce the risks and consequences of losing or leaking tenant documents, you should consider secure cloud storage services or encrypted devices for digital documents and physical documents should be locked up in cabinets or safes with access limited to authorized personnel. When documents are no longer needed, they should be shredded or burned, or a reputable disposal service should be used. Documents that are shared or transmitted electronically should also be encrypted, password-protected, or anonymized. Additionally, staff and contractors should be trained on how to handle tenant documents safely and ethically, and your privacy policy should be updated and tenants and prospects informed about how their information is used and protected. By following these best practices, you can not only minimize the risks of data loss but also improve your efficiency, reputation, and customer satisfaction.

6 Here’s what else to consider

This is a space to share examples, stories, or insights that don’t fit into any of the previous sections. What else would you like to add?