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Ethics

Blogging & Social Media is Mightier than the Sword

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The Blog is Mightier Than the Sword

It all started with a post by Deborah Yao, AP Business Writer. It is now all over the net.

Excerpts below

The Federal Trade Commission is drafting new rules that would extend its authority to encompass bloggers who promote products in exchange for compensation or giveaways. The FTC’s new oversight could be quite extensive, even covering the common marketing practice of affiliate links, as the Associated Press reports:

New guidelines, expected to be approved late this summer with possible modifications, would clarify that the agency can go after bloggers — as well as the companies that compensate them — for any false claims or failure to disclose conflicts of interest. It would be the first time the FTC tries to patrol systematically what bloggers say and do online. The common practice of posting a graphical ad or a link to an online retailer — and getting commissions for any sales from it — would be enough to trigger oversight.

As blogging rises in importance and sophistication, it has taken on characteristics of community journalism — but without consensus on the types of ethical practices typically found in traditional media.

Journalists who work for newspapers and broadcasters are held accountable by their employers, and they generally cannot receive payments from marketers and must return free products after they finish reviewing them.

If the guidelines are approved, bloggers would have to back up claims and disclose if they’re being compensated — the FTC doesn’t currently plan to specify how. The FTC could order violators to stop and pay restitution to customers, and it could ask the Justice Department to sue for civil penalties.

Certainly, bloggers ought disclose compensation arrangements, gifts, and conflicts of interest, and most reputable bloggers already do, but do we really need the FTC to keep its eye on every amateur blogger with a coupon?

Video Response

Here is a video response from Daud08 that brings the point home.  The whole article from Deborah Yao is expounded upon as he takes a deeper look into the implications of the FTC rules.

Blogging is mightier than the sword

“The pen blog is mightier than the sword” means a person can cause people to change their opinions(e.g., to fight a war)and on a large scale whereas a sword can only change a peron’s opion by force and then often only results in the person’s death.

The Founding Fathers of the United States of America considered the pen to be mightier than the sword, and therefore were able to gain the freedom of America by uniting the colonists.

We have seen the power of social media this week in following the Iranian citizens yearning for their freedom.  This is not a door we want to see opened from the FTC.  Again, not saying profits shouldn’t be disclosed but we don’t need anyone looking over our shoulders to see what we write.

I believe the consumers are capable of deciding what to read, what to write and what to purchase. We don’t need the government looking over our shoulders and eliminating our Freedom of Speech. This is a slippery slope.

Hollywood stars endorse products all the time on everything, they are paid for attaching their name to the product. Does it cause everyday Joe’s to buy something? Yes or it wouldn’t be an effective method of advertising.  Most of the actors or athletics probably don’t even use the products. I believe the majority of the American people are smarter than to run out and buy a product they read about on a blog without considering the source.

Photo Credit

Written by Missy Caulk, Associate Broker at Keller Williams Ann Arbor. Missy is the author of Ann Arbor Real Estate Talk and Blog Ann Arbor, and is also the Director for the Ann Arbor Area Board of Realtors and Member of MLS and Grievance Committee's.

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12 Comments

12 Comments

  1. Elaine Reese

    June 25, 2009 at 10:08 am

    Well, first of all with all the serious things going on in the world, bloggers getting free lunches for food reviews should be the least of the gov’t worries.

    Perhaps, the Fed should put their own house in order by requiring politicians to disclose that when they recommend a certain program or bill or project, that they’re doing so based on lobbyists’ donations.

    Now my real question is, when I blog about a new listing, will I have to disclose that if I get the home sold, I’ll earn a certain fee when that happens? I’ll benefit financially from the recommendation I’m making on the home. Is that really any different than recommending a certain restaurant and receiving a free meal?

  2. Missy Caulk

    June 25, 2009 at 10:19 am

    Good points Elaine that is what I meant by not cracking the door open. If you read the article one mom made 800.00 something. Big deal.

  3. Joe Loomer

    June 25, 2009 at 3:35 pm

    Big Brother needs to back the heck up. Although it’s typical for government size to grow in recessions, this is the last thing we need.

    This certainly has the potential to steam roll into something it was not intended to do – much like other government regulations and their unintended consequences.

    What happens when an agent blogs about sponsoring a softball team or school outing? The intent is to be compensated through referral business, but how is that measured? I suspect we’re on the eve of the next blog feces tempest with this one Missy – much in the MIBOR/NAR/Paula Henry vein. This one has much broader implications of course.

    Thanks for continuing to keep your eyes focused on the horizon and making sure the rest of us get in the loop very quickly.

    Navy Chief, Navy Pride

  4. Missy Caulk

    June 25, 2009 at 4:39 pm

    Joe, I think if we are going to be treated to the same standards of Journalist we need press passes to all the BIG events, don’t you?

  5. Joe Loomer

    June 26, 2009 at 9:45 am

    Wish I’d had that press pass to see my Steelers in the Super Bowl last February!

    Did you see how the prez of NAR is enroute DC to lobby changes to the HVCC guidlines?

    Navy Chief, Navy Pride

  6. Mark Jacobs

    June 26, 2009 at 5:57 pm

    It is hard enough to make a living as a Realtor. We don’t need the Fed trying to figure out how to get more of my money.

  7. Matt Stigliano

    June 27, 2009 at 8:26 am

    Missy – Press passes to all the big events? We should get them anyway! Every real estate blogger I know is one part agent, one part journalist. We report the news, just on an even more local scale. And even if you don’t write about the local cat stuck in a tree, isn’t blogging about real estate really just blogging the news? Your blogging about the economy in the smallest sense. Each house purchased causes a wave of other economic activity. It’s on a small scale, but done en masse, it is one of the primary drivers of economic ups and downs.

    Having to worry about “did I say this correctly” will only make the blogs become dry and less personal. At that point we might as well turn in our writing credentials and just pay another monthly fee to someone who can do it for us and do it the “right” way.

  8. MIssy Caulk

    June 27, 2009 at 10:05 am

    Exactly Matthew, it is a slippery slope. Big guys when first passed, normal bloggers tomorrow.

    We don’t need to worry about what we write or referring a small company’s products.

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Ethics

The problem with a self-policing industry: you have to be a narc

Ethics violations in the real estate industry can make or break a Realtor’s career, depending on the severity, so it would stand to reason that all would be mindful of the rules, but there are always individuals in the field that act as if the Code of Ethics is irrelevant.

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An animated discussion on ethics training

“Does anyone else find it ironic that NAR – the trade association for Realtors – has to mandate that members take an ethics class every four years?” An agent who attended one of my company’s broker opens yesterday posed that question to the wine and cheese grazing attendees. Of course, that opened up an animated discussion on the value of etchics training and the lack of enforcement when the rules are violated.

One agent volunteered that the guy sitting next to her in her last ethics class played games on his cell phone and then cheated during the test at the end of the class. Seriously, dude? You cannot even pay attention long enough to pass what should be the easiest test you’ll ever have to take in your career? Perhaps he was just seeing how far he could push it by cheating during an ethics test, to see if anyone else around him caught the extreme irony there. None of the other agents around him – including the agent he cheated off – turned him in and the instructor didn’t notice.

This same agent later called one of my sellers and tried to convince him to break a listing contract with me, because he had a “guaranteed buyer” in the wings. The seller was an attorney, and this bozo tried to get me cut out of the deal, offering the seller a reduced fee to dump me. The seller held firm and directed the agent to call me, then the seller called to let me know about the conversation.

“But you know if you file something the other agent will know.”

It gets better. After the deal closed, I requested paperwork from our local Board of Realtors to file an ethics complaint. The person in charge said, “But you know if you file something the other agent will know.” Gee. Really? I asked her to send the paperwork over anyway.

I called the seller/attorney and asked him to repeat the conversation to me, because I was documenting it to file a complaint. He turned wishy washy on me at that point and his story changed from “The other agent tried to get me to dump you as the listing agent to cut you out” to “Well he really only asked a few questions and I told him to call you. He probably didn’t mean any harm by it.” So there goes my star witness, who doesn’t want to rock the boat.

I didn’t file the complaint. I resorted to the “turn the blind eye but never trust the sleazeball again” path. And that is what happens to almost all ethics issues I hear about / see in person.

That’s what happens when you have a self-policing group of “professionals” who would rather not “narc” on a fellow agent. After all you’re probably going to end up on the other side of a deal from this guy some day, right? The guy in my example has sold two of my houses since that run-in. Why tick him off by filing a complaint and going through all that hassle? If he stops bringing buyers to my properties then my sellers ultimately lose, right?

Boiling down the CoE

The NAR Code of Ethics takes up pages and pages of tiny print, and it runs each year in their trade magazine (I think it’s the January issue). Does anybody read that? Probably not many. I’d argue none of us ever should have to read it again. Simply follow this advice instead. The thousands of words in the Code boil down to one thing: Do unto other agents, and consumers, and clients, what you would have them do unto you. It’s the Golden Rule. Simple. Well, obviously not, for many agents and brokers.

The sad part is the agent in my example had no clue how close I was to filing that compaint, and if he did know he’d probably scratch his head and wonder why his actions were “wrong.” Making us take a one-day class every few years won’t “make” the unethical agents suddenly operate ethically. Most of them just don’t get it.

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Ethics

Ethics hearings in private a disservice to consumers?

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Fight Club and real estate

For those of you that saw the movie ‘Fight Club’ you’ll remember that Rule #1 is “You do not talk about fight club,” followed closely by Rule #2, “You DO NOT talk about fight club.” Which, believe it or not, brings me to today’s topic: The Real Estate Code of Ethics and Arbitration. Article 17 obligates Realtors to resolve fights disputes with another Realtor through arbitration (not litigation). Arbitration is conducted at the local board level, and I am not aware of a local board that doesn’t require arbitration to be confidential.

I respect that public internecine warfare amongst Realtors isn’t in the interest of our industry, and doesn’t belong in the public spotlight. I’m not here to advocate the collective airing of our dirty laundry. That said, I wonder if our collective agreement to keep our concerns confidential can inadvertently harm the consumer and ultimately makes all of us look a little shoddier?

To find the first arbitration guidelines created by NAR and distributed as a set of suggested rules for boards to follow, we have to travel all the way back in time to 1929. NAR’s first Code of Ethics & Arbitration Manual wasn’t created until 1973, and it credited a 1965 California Association of Realtors version as its model.

Appalling conduct

I can think of two instances in the past year where I was so appalled by the conduct of a fellow Realtor that I went to the trouble to inquire about how to lodge a Code of Ethics complaint with my local board. After weighing the time required to make a competent complaint and comparing it with the best case outcome (a closed-to-the-public hearing in which they were found to have violated the code of ethics), I decided not to pursue a complaint in both cases. My association’s bylaws (and probably yours) give it the power to discipline any member based on the results of a Code of Ethics hearing, “provided that the discipline imposed is consistent with the discipline authorized by the Professional Standards Committee of the National Association of REALTORS® as set forth in the Code of Ethics and Arbitration Manual of the National Association.”

“Sanctioning Guidelines” – (Appendix VII of Part 4 of the 2011 manual for the very curious), guides member boards to impose disciplinary consequences that are progressive and fair, taking all considerations into account. Sample first-time disciplinary actions include suggestions of a letter of warning, a fine (amounts range from $200 to $5,000 depending on the severity of the violation), and attendance at relevant education sessions. Not to sound defeatist, but a confidential letter of warning and a fine of around $200 doesn’t seem like an outcome worth investing much of my time in.

Practicing in the internet era

Given that we live and work in the internet era, and review sites like Yelp abound, it seems a bit odd to me that a local board might know of an agent with problem behavior that is documented yet choose to make that information unavailable to consumers. My understanding is that the results of a code of ethics hearing are confidential with disclosure authorized in a few situations, none of which deal with informing the public.

Many of my fellow colleagues feel that the best response to a bad agent is to be patient and give them enough time to work themselves out of business. I can respect and understand their hands-off approach. But what about the damage that individual does to our industry as a whole? While we whisper, warn in confidence and know amongst ourselves how awful they are, the public doesn’t get the benefit of our perspective. Deprived of it, they turn to consumer review sites like Yelp.

How do you think we, as an industry, can help consumers in their quest to find a trustworthy agent?

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Ethics

Realtors, we really need to get over ourselves already

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A letter from the child of a Realtor.

Real estate now vs. 1987

In Real Estate, some things are always changing, like financing, education, laws, rules and technology. The two that will always remain constant, as long as they are within the law, are following our clients’ directions, and working with their best interests in mind.  I’m not sure we always follow through with this, though.

Some of us knowingly take over priced listings.  Some of us take listings that are out of our area of expertise.  Some of us won’t show short sales or REOs.  Some of us won’t show homes with low co-op splits.  Some of us don’t have Supra/e-Keys, and miss out on those listings entirely.

Putting our interests first

When these things occur we are putting our own interests first, not our clients’.  We may think that by having as many listings as possible is a good thing, that’s what we’re taught after all, isn’t it?  It may not matter that some are overpriced, eventually, whether one month or four months down the line, the price will be reduced.  It’s just a matter of time and money, for our clients, after all.  The same can be said when we take listings outside our area of expertise, just to add on to our inventory.  If we don’t know what we’re doing, on a short sale listing, for example, it will only cost our clients a lot of time and money.  A lot.

By eliminating certain houses our clients see, that may already fit their criteria, we’re taking away their choices.  Distressed sales account for close to 40% of the market.  This is probably higher in some local markets.  There is no legitimate way to ignore roughly 1/3 of the homes being sold.  Co-op fees are often a touchy subject, especially when they are, not “enough.”  If everyone utilized a Buyer Broker Agreement that stipulated what their fee was, the issue would take care of itself.  Not being able to access listings with the use of Supra/e-Keys is a choice.   Choosing not purchase one will mean agents will not be able to access Fannie Mae (and eventually, probably additional Gov REO homes) along with the listings that are already using them.

Our priorities versus theirs

We totally need to get over ourselves already.  We are not bigger than our clients.  Our priorities are not more important than theirs when it comes to the actual listing and selling of homes.

Recently, my awesome parents dug through a few boxes and rounded up one of my first art projects. About 25 years ago I did the poster featured above about my Mom, and her Real Estate career.  It was for an Open House (no pun, honest!!!) for the elementary school where I attended first grade.  It was just, what she did according to me way back then.  Things are way more complicated now, than when I was six.  There’s a heck of a lot more paperwork for one.  But the same basic principle still applies.

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