Among the many issues examined was data privacy and the growing trend towards industry self -regulation. Recently, both the Federal Trade Commission and the Commerce Department issued reports encouraging industry to implement privacy self-regulatory programs.
Simply stated, self-regulation is a structure where the industry defines the privacy promises it makes to its customers then, once the promises are defined, a third party (usually a government regulator) steps in to enforce the promises. The theory is that the industry itself is best situated to create principles or promises for consumers that reflect the unique characteristics of a particular industry. Several industries have recently implemented privacy self-regulatory programs including the online advertising industry and the electronic retailing industry.
Why is Privacy an Issue for REALTORs?
NAR conducted a survey last year of member data collection practices and their awareness of privacy as a critical business issue. What we learned was that REALTORs collect a great deal of sensitive personal information from their clients but have an alarming low awareness of the need to implement privacy and data security practices. To help address this, NAR created a Data Privacy & Security Toolkit (you will need your NAR NRDS number to access) to help educate our members about this important topic. This no doubt is only a first step in a longer process to educate the industry on issues of data privacy and security.
Why Self-Regulation?
We think that it is just plain smart for the industry to come up with its own set of privacy practices that take into account the specific characteristics of the real estate industry before the FTC or Congress does it for us. For example, in real estate consideration must be given to the fact that most agents are independent contractors. Principles that take into account the broker agent relationship will suit the industry better than one- size- fits- all approach.
I’d like to hear what you think. Does it make sense for the real estate industry to develop best practices and a self-regulatory program around data privacy and security? If so, what special real estate industry characteristics need to be addressed?
