Hitting Where It Hurts
Wednesday, July 17, 2013
Orlando REALTOR® | JulyAugust 2013
New $15,000 fine aims to deter
blantant disregard for the
REALTOR® Code of Ethics
By Kristy Harrington, Esq.
The National Association of REALTORS® Midyear Meeting in May produced a major update to the professional standards procedures related to violations of the REALTOR® Code of Ethics: Beginning on January 1, 2014, the maximum fine that a hearing panel can impose for an ethics violation is increasing to $15,000.
The new amount is a significant increase from the $5,000 maximum fine limit that was set back in 2002. According the NAR Board of Directors, which approved the measure, the primary reason for the increase is a concern about REALTORS® who knowingly violate the code of ethics because they’ve historically considered any resulting fine merely a "cost of doing business.” The upward shift is designed to hit the wallet much harder, especially when it comes to members who appear not to care about honoring the code.
A hearing panel is unlikely to impose the maximum fine for most first offenses and for many violations in general. While a fine is always a permitted sanction following a hearing where a violation is found, the panel determines a fine amount that is commensurate with the nature of the violation; the REALTOR’S® level of experience in the industry; the number of times the REALTOR® has been found in violation of the code; whether the REALTOR® took steps to fix the violation once it came to light; whether the REALTOR® appeared to know they were committing a violation; and other such considerations as set forth in the REALTOR® Code of Ethics and Arbitration Manual.
Kristy Harrington, Esq., Law Office of Kristy L. Harrington, P.A., can be reached at Kristy@LawHarrington.com. She is a board member of the Central Florida Real Estate Attorneys Council.
CFREAC provides this column on real estate law issues as a service to ORRA members to provide a general understanding of the law on various topics of interest, not as a substitute for individual legal consultation, and should not be relied on in specific situations without consulting with a real estate attorney. For more information, please visit www.centralflrec.com.