technology

Cybersecurity Threats and Their Impact on Real Estate Transactions

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Imagine arriving at your real estate closing only to learn that the county’s property records are unavailable. If the documents can’t be recorded, then the transaction may be left hanging in the air. Depending on lender funding requirements, the closing attorney may not be able to disburse the funds, and the buyer may not be able to receive their keys until recording is available. It sounds far-fetched, but it’s exactly the type of disruption that recent cyber-attacks on county governments have made possible.

Most people never think about their county recording office until they’re buying or selling real estate. Deeds, mortgages, easements, plats, liens, and other documents are quietly recorded every day, creating the public record that establishes who owns property and what interests affect it. It’s a system that has worked for generations because it relies on one simple principle: the public records must be accurate, complete, and accessible.

Recent events in South Carolina serve as a reminder that this system is more fragile than many people realize.

A recent cyber attack disrupted access to property records and other county services, temporarily preventing normal operations. While the details of the investigation continue to emerge, the incident highlights just how dependent modern real estate transactions have become on digital access to public records. Unfortunately, this is not an isolated event. Several South Carolina counties have experienced technology failures, ransomware attacks, or other disruptions in recent years.

Cyber security, however, is only one challenge facing county recording offices.

Many counties across the state operate with limited budgets and skeleton crews. Employees often process hundreds of documents each day while balancing increasing demands and aging technology. Even the most dedicated public servants can struggle when resources are stretched thin. Under staffing and insufficient training increase the likelihood of recording errors, indexing mistakes, or delays in processing documents – all of which can create headaches for property owners years later.

The integrity of the public record is essential because virtually every real estate transaction depends on it.

Before issuing title insurance, conducting a closing, or approving a mortgage loan, attorneys and title professionals examine the public records to confirm ownership and identify any issues affecting the property. They are looking for deeds that properly transferred title, unreleased mortgages, judgments, tax liens, easements, restrictive covenants, and countless other matters that could affect ownership rights.

If those records are unavailable because of a cyber attack, the transaction may be delayed. Buyers may not be able to close on schedule. Sellers may miss contractual deadlines. Lenders may refuse to fund loans until title can be verified. Even a short interruption can create significant inconvenience for everyone involved.

More concerning are situations where records have been altered, corrupted, or improperly indexed. The public recording system functions because people can trust that what they find is complete and accurate. Preserving that trust requires not only secure computer systems but also adequate staffing, proper training, and ongoing investment in the offices that maintain these records.

Although county governments bear much of the responsibility for protecting these systems, cybercriminals often gain access through surprisingly simple methods.

Many cybersecurity incidents begin not with sophisticated hacking tools but with social engineering. Rather than attacking computers directly, criminals manipulate people into providing passwords, opening malicious attachments, or clicking fraudulent links. These phishing emails are designed to look legitimate and frequently impersonate trusted organizations, coworkers, financial institutions, or government agencies.

While this blog focuses on real estate law, cyber attacks and scams aren’t limited to real estate transactions. Anyone, not just government employees, can become a target. A few simple precautions can dramatically reduce the risk of becoming a victim. Be cautious of unexpected emails requesting urgent action. Verify unusual requests through a separate phone call or trusted contact information rather than responding directly to the email. Avoid opening attachments or clicking links unless you are confident they are legitimate. Enable multi-factor authentication (“MFA”) whenever possible, and keep software updated to address known security vulnerabilities.

These habits protect more than your personal information. They help protect the institutions that communities depend upon every day.

County recording offices rarely make headlines when everything is working properly. Yet they perform one of the most important functions in our legal system by preserving the history of property ownership and ensuring that buyers, sellers, lenders, and attorneys can rely on the public record.

As counties continue modernizing their technology, cybersecurity must remain a priority. At the same time, we should not overlook the importance of investing in the people responsible for maintaining these records. Secure systems, well-trained staff, and accurate public records are not simply administrative conveniences: they are essential to protecting property rights and keeping South Carolina’s real estate market functioning smoothly.

Surfside Beach and the Continuing Threat of Business Email Compromise

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According to news reports, the town of Surfside Beach may be one of the latest victims of a business email compromise-type fraud attack. Unfortunately, early reports suggest that the town may have lost over half a million dollars to scammers. South Carolina’s State Law Enforcement Division is actively investigating this incident, so the information we have is limited and unproven, but if true this amount would represent a loss of funds equal to approximately 2.6% of the town’s 2025-2026 budget.

Wildcat Construction was engaged by the town to do some work on its public utilities, and one of its bills, in the amount of $545,598.30, was due for payment. On March 13, 2026, the town indicates it initiated an ACH payment to what they thought was an account belonging to Wildcat, but Wildcat says that it has no such account and that it had requested payment by check. The town released a public statement in which it acknowledged it had “identified a potential cybersecurity incident involving its email environment,” and reported the incident to law enforcement. Details about what exactly may have happened internally at the town level are pretty scant. While SLED is investigating, Wildcat maintains that it has not received the funds, and that it is still entitled to be paid. It is easy to imagine how a scammer might have sent a “spoofed” email to a Town employee, pretending to be an accounts receivable clerk for Wildcat, with a fake set of payment instructions for the Wildcat invoice. The same type of “spoof” attack happens all too often in real estate deals where the closing attorney is gathering invoices and payment instructions. If the Town employee failed to properly verify those payment instructions, then just like the danger of wire fraud in a real estate transaction, the funds could have been sent to a fraudster instead of the correct party.

Data published by the FBI’s Internet Crime Complaint Center, which tracks and reports cyber-crime involving US interests, indicates that both the number of cyber-crimes against, and the amount of property lost by, Americans continues to skyrocket. The IC3 reports that in 2025, it received a total 1,008,597 of cyber-crime complaints for all types of cyber-crime, and it tracked over $20.8 Billion in total losses related to cyber-crimes. The clear indication here is that cyber-criminals are increasing their attacks on our businesses, and are succeeding in stealing more of our money.  

This incident is yet another example highlighting the importance of verifying payment instructions with a known, trusted contact. That includes not only the routing/account numbers, but also the form of payment. In this example, Wildcat says it told Surfside they wanted a check, but the payment was made via ACH to an account that Wildcat says it did not provide to the Town.

While the “worst case scenario” impact on Surfside Beach, even if these funds are permanently lost, looks like it would be below 3% of the town’s overall annual budget, the risk to South Carolina lawyers of wire fraud and business email compromise is potentially much more dire. For a small or solo real estate-focused law firm whose annual fee revenues might be closer to the $1,000,000.00-mark, loss of funds for a mortgage payoff could be much higher as a percentage of the firm’s budget. If we assume that a typical mortgage payoff for a SC home might be around $250,000.00, then it’s easy to see how that amount, when targeted by fraudsters, could be a devastating loss for a small firm. And, while this particular example was not a real estate law firm, it demonstrates that the fraudsters are out there actively targeting anyone they think they can, and that no one is immune to their attacks.

Stay vigilant out there, folks!

The 2026 ALTA Survey Standards Are Here

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What South Carolina Real Estate Attorneys Need to Know

As of February 23, 2026, the 2026 ALTA/NSPS Minimum Standard Detail Requirements for Land Title Surveys officially replaced the 2021 standards. These updates may appear technical at first glance, but for South Carolina real estate attorneys—particularly those handling commercial transactions, development work, and lender representation—the changes carry meaningful legal and practical consequences.

The 2026 Standards reflect evolving technology, shifting risk allocation, and mounting expectations from title insurers and lenders. Attorneys who understand these changes will be better positioned to manage risk, avoid closing delays, and advise clients with confidence.

In South Carolina, ALTA/NSPS Land Title Surveys are a cornerstone of development due diligence, commercial financing and title insurance underwriting. While surveyors perform the fieldwork, attorneys are often the gatekeepers—reviewing surveys for compliance, identifying red flags, and reconciling survey matters with title commitments.

Any change to the ALTA Standards therefore ripples directly into:

  • Title objection and resolution strategies
  • Closing timelines
  • Survey exceptions and endorsements
  • Risk allocation among buyers, lenders, and insurers

The 2026 Standards were jointly adopted by ALTA and the National Society of Professional Surveyors (NSPS) in October 2025 after several years of committee work, with the stated goal of improving clarity, consistency, and adaptability.

A Clear Effective Date—with Transitional Traps

The effective date for the new standards is February 23, 2026. Any ALTA/NSPS Land Title Survey contracted for on or after that date must comply with the 2026 Standards unless the parties agree otherwise in writing. Surveys contracted before the effective date may still be governed by the 2021 Standards, even if completed later—but only if that is clearly addressed in the engagement agreement.

For attorneys, this means:

  • Engagement letters and contracts should specify which ALTA standard applies
  • “Survey updates” or revised plats may trigger new standard requirements
  • Ambiguity can expose clients—and counsel—to disputes with lenders or insurers

Technology Is Now Explicitly Embraced

One of the most forward‑looking changes is the shift from requiring information obtained strictly “on the ground” to allowing “practices generally recognized as acceptable” in both fieldwork and mapping. This expressly accommodates modern tools such as drones, LiDAR (Light Detection and Ranging), and other remote‑sensing technologies, without tying the standards to any specific method.  

For attorneys, this reinforces the need to:

  • Review surveys for completeness, not methodology
  • Understand that aerial or remote data may now support certain depictions
  • Counsel clients that innovation alone is not grounds for objection

Expanded Documentation of Possession and Occupation

Perhaps the most practically significant change is the requirement that evidence of possession or occupation be noted along the entire perimeter of the property, regardless of proximity to boundary lines. This exceeds prior standards, which often focused only on near‑boundary features.

This change:

  • Increases the likelihood that surveys will reveal fence lines, uses, or improvements suggesting potential boundary or prescriptive issues
  • Elevates the importance of attorney review and follow‑up
  • May increase survey‑related title objections and negotiation

Parol Statements Must Be Noted

Closely tied to evidence of possession and occupation, under the 2026 Standards, surveyors must note any verbal (“parol”) statements made by landowners or occupants relating to title or boundary issues.

For attorneys, this is a double‑edged sword:

  • It may surface issues earlier in the transaction
  • It also introduces non‑record information that may complicate underwriting, disclosures, and risk tolerance

These notations do not constitute legal opinions, but they should never be ignored during diligence.

Title Evidence and Research Responsibilities Are Clarified

The 2026 Standards expand guidance on how surveyors source title evidence when a current title commitment is unavailable, and they more clearly acknowledge shared responsibility between surveyors and title professionals for obtaining certain documents.

South Carolina attorneys should:

  • Provide current title commitments early whenever possible
  • Clearly communicate expectations regarding easement depiction
  • Coordinate closely with surveyors on complex tracts or non‑fee interests

Table A Gets a Notable Update

The optional Table A items remain a critical tool for tailoring survey scope. In 2026:

  • Item 15 was clarified to allow certain depictions via aerial or satellite imagery if agreed to in writing
  • A new Item 20 requires a summary table of conditions and potential encroachments on the face of the survey—intended as a factual summary, not a legal conclusion
  • The former “catch‑all” or blank item has been renumbered as Item 21

Attorneys should carefully align Table A selections with lender and client expectations.

Practice Takeaways for South Carolina Real Estate Attorneys

The 2026 Standards raise the bar—not by radical change, but by greater disclosure and clearer expectations. Attorneys should update internal checklists, educate clients, and adjust survey review practices accordingly.

Data Centers Raise Legal Questions for Rural South Carolina

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Across rural South Carolina, data center proposals are generating increasing controversy as residents challenge whether counties are complying with zoning statutes, comprehensive plans, and public‑notice requirements.

In Colleton County, Council amended its zoning ordinance to add data centers as a permitted use and to create a special exception within residential districts – changes that paved the way for a proposed $6 billion facility near the environmentally protected ACE Basin. In January, neighboring landowners, represented by the Southern Environmental Law Center, filed suit alleging that the county enacted these amendments without adequate notice or transparency, that the changes conflict with the county’s comprehensive plan, and that allowing an industrial special exception within a rural district is inconsistent with existing zoning classifications.

Similar disputes continue to surface statewide. In Marion County, Council recently approved a $2.4 billion data center project and a fee‑in‑lieu‑of‑tax agreement. The project appeared on the agenda only under the code name “Project Liberty” and was covered by a nondisclosure agreement, leaving the public without meaningful information until the final reading. Aiken and Berkeley Counties have faced comparable challenges.

Opponents of data centers emphasize their extraordinary electrical demand, which has already strained power grids across the country. Some estimates now place data‑center consumption at roughly seven percent of U.S. electricity use, with projections continuing to rise. In the Colleton debate, residents expressed concern that utilities lack sufficient capacity to serve the proposed facility and that ratepayers – particularly Santee Cooper customers – may ultimately bear the cost of necessary upgrades.

Water usage presents a parallel problem. Data centers generate substantial heat and rely heavily on water‑based cooling. The volume required can impose real stress on local water systems, particularly in rural areas. While newer closed‑loop cooling technologies reduce consumption, they require additional energy and higher capital investment.

Other community impacts have also drawn scrutiny. Backup diesel generators – which data centers depend on for uninterrupted service – emit gases and particulates that may pose health risks. Residents in rural counties also cite noise, light pollution, and the visual intrusion of large industrial campuses as threats to the historic and environmental character of their communities.

Yet despite these concerns, the economic incentives remain significant. Proponents of the Marion County project note that the facility could generate nearly $28 million annually for a county operating on a $25 million budget. Construction phases typically span several years, providing a substantial economic boost. And although data centers require relatively few employees once operational, they nevertheless contribute positively to local employment and tax revenue. Moreover, the facilities are essential to the growth of artificial intelligence and advanced computing – technologies many policymakers liken to a modern “space race.”

The General Assembly has taken notice. Several bills addressing data‑center siting, utility impacts, and environmental standards have been introduced this session. Developments in the Colleton County litigation, along with potential legislative action, will likely shape future permitting and zoning practices statewide.

For South Carolina lawyers, these projects are becoming increasingly complicated to navigate to completion. Title insurers are increasingly view data centers as high‑risk properties due to their scale, public visibility, and susceptibility to challenge. Attorneys may be asked to perform extended title examinations, provide more detailed zoning analyses, and secure specialized endorsements requiring careful underwriting. As counties pursue these high‑value developments and as communities continue to push back, lawyers will as always be on the front lines.

Secret Service issues new Advisory

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Real estate impersonation scams have “evolved”, it says

In September, the United States Secret Service issued an update to its “Real Estate Scam – Vacant Properties” Advisory (v. 1.1) The original Advisory was issued in Spring of 2022.

The current Advisory warns that the Secret Service has become aware of an increase of instances where criminals are impersonating title companies to steal real estate funds. Remember that “title companies” actually close transactions in many states. In South Carolina, the bad actors would impersonate law firms and banks.

Now more than ever, it is important for everyone involved in a real estate transaction to validate wires before they are sent. The last thing you need is for your law firm to have to provide funds to replace lost closing proceeds!

Often, the perpetrator impersonates the title holder and negotiates to sell unoccupied property to an unsuspecting buyer. Once the contract is signed, the criminal directs the buyer or realtor to the criminal’s account, impersonating a title company or law firm. The perpetrator impersonates the closing office by purchasing fake domains, similar to the closing office’s domain. (Such as me@lawfiirm.com vs. me@lawfirm.com.)

Red flags are identified by the Advisory:

  • Communications are primarily by email and communications contain poor grammar.  (This is from me, not the advisory. If you ever seen the word “kindly”, such as “kindly wire the funds to….” Remember we don’t typically talk that way! Any twisted language or bad grammar may indicate the communication is coming from someone and some place with a first language other than English. Always use common sense!)
  • Wiring instructions are sent over standard email instead of a secure email platform.
  • The listing is below market value and the “seller” is looking for a cash buyer or quick closing.
  • The “seller” wants to use its preferred closing office.
  • The closing office is outside of the area where the real estate is located.

The Advisory suggests the following avenues of prevention:

  • Conduct an online independent search of the entity to which the funds are to be wires.
  • With a known phone number (from a trusted website or previous contact) CALL and verify the wiring instructions and names on accounts.
  • If possible, visit a local branch of the entity to which the funds are to be wired.
  • Obtain a government issued ID from each party, and evaluate IDs for abnormalities.
  • Consider a form of multi-factor authentication with your clients. For example, send an overnight letter to the mailing address on the tax bill asking the property owner to call you with a one-time code embedded within the letter.

To read more, visit http://www.secretservice.gov. And be careful out there!

The State reports Zillow is suing Richland County

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The State newspaper reported on July 2 that the home-buying site Zillow is suing Richland County. The claim is that the County is violating public records laws by failure to reply to a Freedom of Information (FOIA) request for property tax data.

The article reports that in May, Zillow requested property assessment data from Richland County by submitting multiple FOIA requests. The County first responded that it did not have any records matching the request. Then, the County denied the request because the requested information is available online and argued that state law does not require the County to create new documents to fulfill a FOIA request.

Zillow argued, according to the article, that not all the assessment information for every parcel in the County is available online. Zillow had apparently requested an electronic copy of the assessment files for all the parcels instead of the option to search parcels one by one. The company apparently didn’t want to have to search titles in the manner of South Carolina real estate professionals.

Zillow also argued that it had received the requested information in prior years. Before 2022, the company said it had received the assessment date from the County each year in the format the company requested, which was an electronic file that contained all assessment information. The lawsuit claims the company paid about $8,800 per year for that information.

Zillow is now suing for the requested information and demanded that the County pay Zillow’s legal fees if the lawsuit is successful. We’ll see what happens with this one!

Is your insurance company spying on your house?

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This blog has discussed several times the difficulty of getting and maintaining homeowner’s insurance in some locations, especially coastal areas. This appears to be an extremely difficult issue in Florida, and I have heard similar concerns along South Carolina’s coast.

The Wall Street Journal is now reporting that insurance companies are increasingly using aerial images from drones and balloons as a tool to cancel insurance on properties deemed as higher risk. You can read the article here. Googling the topic also reveals several related stories.

Apparently, angry homeowners are reporting losing coverage because of images reflecting damaged roofs, debris in yards, and undeclared hazards such as swimming pools and trampolines.

Consumer advocates object to this tactic on privacy and other grounds. For example, the images could be outdated or otherwise inaccurate. Time frames for correcting the problems may be too short. And the secrecy of the “inspections” may be deemed to be unfair.

State law may require inspection reports to be delivered to the consumer, and some state laws may limit the reasons insurance companies may use to fail to renew coverage.

According to the articles, insurance companies find the use of aerial images is an efficient way to capturing data. The technology is sophisticated and continues to improve. The companies also claim that weeding out risky properties through visual inspections helps everyone by decreasing claims.

Of course, this issue arises as we are seeing increasing premiums in homeowner’s coverage.  Count on homeowner’s coverage continuing to be in the news.

CFPB says lenders must use specific and accurate reasons for credit denial

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On September 19, the Consumer Financial Protection Bureau (CFPB) issued guidance to lenders using artificial intelligence and other complex models. The guidance indicates lenders must use specific and accurate reasons when taking adverse actions against consumers.

This means, according to CFPB’s press release, that creditors cannot simply use sample adverse action forms and checklists if they do not reflect the actual reason for the denial of credit.

“Technology marketed as artificial intelligence is expanding the data used for lending decisions, and also growing the list of potential reasons for why credit is denied,” said CFPB Director Rohit Chopra. “Creditors must be able to specifically explain their reasons for denial. There is no special exemption for artificial intelligence.”

The press release indicates creditors that simply select the closest factors from the checklist of sample reasons are not in compliance with the law if those reasons do not sufficiently reflect the actual reason for the action taken. Creditors must disclose the specific reasons, even if consumers may be surprised, upset, or angered to learn their credit applications were being graded on data that may not intuitively relate to their finances.

You can read the entire guidance here.

Cybersecurity Breach affects SC county offices

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Chicago Title’s South Carolina state office sent out a memorandum on December 29 announcing that Cott Systems, Inc. has suffered a cybersecurity breach. I wanted to make sure the readers of this blog have access to this important information.

Cott Systems provides many services to county offices, including electronic recording, record storage, online searching, and court case management. Chicago Title has been told that Cott Systems provides services to at least the following counties: Darlington, Florence, Marlboro, Oconee, and Union. Other counties may be involved.

Apparently, this company took its services offline upon discovery of the breach. As of December 29, the company was unable to estimate when service may be restored but reported that it is working diligently to address the problem. As of mid-day on January 4, we were told that at least two counties were back online. I hope all of them are up and running at this point.  

If title abstracting and recording services are ever unavailable in the counties where you do business, please contact your title insurance company for assistance. Your friendly underwriters should be able to talk with you to resolve your issues, depending on the dates of your prior title work, dates of closings, etc.  Please be careful out there!

Some (relatively) new scam tips

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If I told you how many articles I’ve written about fraud and scams, you’d think I’m much older than I am, so we won’t go there. But I am old enough to be retired. My husband and I both worked for large corporations who kept us current on scams of all kinds. In retirement, we must read numerous sources to make sure we keep ourselves safe online and otherwise.

The Washington Post, one of my favorite newspapers, published an article on September 6 entitled “Yes, it’s a scam; Simple tips to help you spot online fraud.” You can read it here.  

The first tip makes so much sense: “Have “the talk” with family members.” This is so important! Tell your aging parents, your teenagers who spend a considerable portion of their lives online, and everyone in between the tricks you learn from your practice and your title insurance company about safety online. As painful as it may be to assist your elderly family members with their computer issues, keeping them safe from scams will save you from having to unwind the problems. Tell your family members to come to you to “gut-check”, as the article advises, suspicious messages and phone calls.

The second tip involves social media. The article advises that privacy settings can make it significantly harder for cybercriminals to successfully target you and your family members. Read the article for the details.

The third tip is my mantra: stay current! Using current events for unjust enrichment is a prime strategy of scammers. The article reports that within 24 hours of President Biden’s announcement of the student loan forgiveness program, The Federal Trade Commission released a warning about student loan scams. Updates for all of us are available at Fraud.org, a project of the National Consumers League. Make one of your employees responsible for reviewing and reporting on the great information from that site. And make sure your family members know about it.

I love this one: “Assume that people or companies aren’t who they say they are.” As lawyers, we’re naturally and by education skeptical. Make sure those around you approach the internet and telephone as skeptically as you do.

This one is great: “Verify everything using a different channel.” Title insurance companies have been telling their agents for years (decades!) to verify wiring instructions by making a telephone call using a known and trusted telephone number. This advice can be used in other areas of online life. Use official customer service numbers and websites. Call your bank! Call or text a friend who asks for money via social media. The article advises the use of AARP’s free telephone service to ask about possible scams: 877-908-3360.

The article advises all of us to memorize the signs that something is a scam:

  • You didn’t initiate the conversation.
  • You won something.
  • You are panicked:  scammers want to create a sense of urgency.
  • It involves fast payment methods: peer to peer payment apps, for example.
  • There are payment complications. For example, the scammer will offer to pay over an app like Zelle, say there’s a problem, then ask for your email address so they can send a fake email to get your information.
  • They want information.
  • Something doesn’t feel right.

Stay current, keep your office current, and keep your family members current!