It Seems So Simple
When we become REALTORS, we’re supposed to subscribe to a Code of Ethics. Subscribe to as opposed to be restricted by . I always thought it was a good thing. Something to be proud of. A higher standard that we’re willing to be held to.
There’s only 17 articles in the Code of Ethics. Only one of them deals with money disputes (the last one, Article 17 – ) so that leaves 16 Articles to define our ethical practices as real estate professionals.
One of the core articles is Article 12 of the code which states “quote the article here”.
So Why Don’t People Get it?
Lisa Sanderson wrote a post here a couple of days ago about the ability of members to influence associations through their participation. In the comments, a discussion started about the dispute between Mark Rasmussen and the Sarasota Association of REALTORS. This post was originally going to be a comment there, but the more comments I read, the more depressed I got because there seemed to be so many practicing ethical REALTORS responding who just completely misunderstand the issues.
(Caveat; I am reproducing the facts as I found them in various Blog Posts and sites regarding these issues. Because so many people have written about this, and so much of the information they provide is conflicting, I’m giving you my understanding of the facts – and only the facts – not opinions)
The Short Version
- A REALTOR named mark Rasmussen owned and used SarasotaMLS.com as a domain name. Over a period of years, he enjoyed a high SERP through the use of that name.
- A complaint was filed with the Sarasota Association of REALTORS, and an ethics hearing was held. The findings of Ethics hearings are not to be revealed to the public, so I cannot, with any authority tell you what happened there.
- A hearing was held before ICANN who found that “(1) the domain name registered by the Respondent is identical or confusingly similar to a trademark or service mark in which the Complainant has rights; (2) the Respondent has no rights or legitimate interests in respect of the domain name; and (3) the domain name has been registered and is being used in bad faith.” (So it was the organization that monitors and adjudicates such things that made this decision not the Association)
- The Association is a non-profit organization that is not a competitor of Mark Rasmussen and gains no commercial advantage in owning the domain name, other than to prevent its use by a member or non-member which might be detrimental to the entire membership of the Association.
- Mark Rasmussen is currently suing the Association to be allowed to use the domain name. His use of that domain name would prohibit anyone else from using the name, even if they may have the same or superior entitlement to use the name.
Its Not About the Letters MLS
I don’t know Mark Rasmussen nor do I know any member of SAR (at least I don’t think I do – if there is someone I have met who does belong to SAR, I’m sorry I didn’t remember your Association affiliation).
And there seems to be a lot of discussion about the letters MLS instead of what I think are the actual issues here.
- The findings of the Ethics hearing are a result of a specific hearing panel. One of the reasons such findings are not published is a fear that people might look to earlier panels findings and give the weight as establishing precedents, instead of allowing each new hearing to create its own set of findings
- I think the domain name sarasotamls.com is misleading. A reasonable consumer, clicking on a such a link, might reasonably conclude that they were going to an organizational website rather than a commercial website.
- In fairness I would note that Mr. Rasmussen had disclaimers added to his site at some point to let people know that it was not an MLS site – but these would have been unnecessary if the consumer had not been mislead in the first place – making the point that somewhere along the line he realized that he was misleading people and wished to stop misleading them when he had accomplished his objective of obtaining web traffic.
- The fact that Mr. Rasmussen had invested money or spent time utilizing this site before there was clarification that such a misleading action might be unethical does not create some sort of exception to the ethical issue posed. In fact, if someone is doing something unethical (unknowingly) and it was not done in bad faith, wouldn’t they stop doing it when the ethical issue is raised?
- As a second note, it might be asked if the issue here is merely one of the time and effort spent by Mr. Rasmussen to promote the sarasotamls.com shouldn’t he be able to duplicate his efforts with an equal amount of success? While I sympathize with the amount of additional time and effort that might have to be spent to acquire the same position for his new site, doing things ethically is certainly worth it.
It Is Not David Vs. Goliath Here
So I thought I would see what happens when I typed the offending terms – and hgere is what I found.
So what’s the harm here? No competitor of Rasmussen is being aggrandized at his expense. All of the people who might comprise what the public understands as the sarasota mls are here.
Then, since part of the issue is the damage that Mr. Rasmussen might suffer to his business, I tried a few other common search terms – for example “Sarasota real estate”;
Oddly enough, Mr. Rasmussen is still #1 and there’s a guy named Michael Saunders (about whom I have read nothing) who is number 2 – Watch this guy – we’ll see him again.
S0 then I checked out ‘ sarasota homes” Rasmussen #1 Michael Saunders #2
And then “Sarasota Properties” Rasmussen #4, Michael Saunders now #3
I could keep doing this but I think you get the idea. If people find you that easily on searching area, homes, properties and area real estate, why do you need the organizational URL with MLS in it? If people are looking for a real estate professional then these three phrases are probably among the best – in fact here is a Google Keyword Search which indicates that Sarasota MLS is the thrid ranked of these four searchs, coming in a bad third after “sarasota real estate” and “sarasota homes” as you can see below;
So let’s we get some focus on this issue – its not free speech, its not restraint of trade, the guy is still high ranking on Google, and obviously is not being hurt by the loss of this domain. In fact, his competitor Michael Saunders seems to get great placement without all the hearings and litigation.
So can we agree that if ICANN – who is not a real estate related entity and has no allegiance to NAR or SAR, believes this type of URL is confusing to the public, it just might be confusing to the public? I understand that we don’t like to give up what we have worked on, or to find out that we are going down the wrong road in our marketing efforts, but Isn’t it still important to do the right thing?
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.
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.
Ethics hearings in private a disservice to consumers?
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.
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?
Realtors, we really need to get over ourselves already
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.
Opinion Editorials1 week ago
America has an addiction to being busy, here’s what we need to do about it
Business News1 week ago
Email remains the top communication tool for businesses – here’s why
Business Marketing2 weeks ago
News flash: Your coworkers are not your family
Business News3 days ago
10 ways retailers track repeat customers that you can implement now
Business Marketing3 days ago
Use nostalgia as a marketing niche for your business today
Business News5 days ago
5 reasons why you need a mentor, stat!
Opinion Editorials1 week ago
The one easy job interview question that often trips up applicants
Business Entrepreneur1 week ago
4 tips for success for acquiring a business, and how and why to do it