Case #10-5: Use of “Choose Your Neighbor” Form Letters as Part of a Marketing Campaign
The ABC Association of REALTORS® received a complaint from a local fair housing group alleging that REALTOR® A was using discriminatory marketing techniques, in violation of Article 10 of the Code of Ethics, as the listing broker for a property in a new subdivision.
In support of their complaint, the fair housing group provided copies of “Choose Your Neighbor” form letters sent by REALTOR® A to current neighborhood residents. The letters announced that the property was on the market and invited neighborhood residents to contact REALTOR® A if they knew of anyone who they thought might be interested in purchasing the home.
At the hearing, REALTOR® A defended his use of “Choose Your Neighbor” form letters by demonstrating that they were just one element of his marketing campaign, and were not an attempt to restrict access to the property on the basis of race, color, religion, sex, handicap, familial status, country of national origin, sexual orientation, or gender identity, as prohibited by Article 10. REALTOR® A produced copies of banner advertisements run on several websites, “OPEN HOUSE” information provided on Realtor.com, and a copy of the property’s MLS listing. REALTOR® A remarked, “In my experience, the current residents of a neighborhood often have friends or relatives who have said that they would love to live in the neighborhood. It just makes sense to me to include contacting these folks in any marketing campaign!”
See below for how this hearing panel ruled…if you think a violation, how much discipline would you impose? Fine of $________ and ____ hours of education.
Citations are not available for fair housing ethics article 10 complaints due to the seriousness of the allegation. However, respondents always have the due process right to waive a right to a hearing (e.g., admit the violation, take the discipline imposed). Associations report fair housing violations to the licensing authority. [Citations can apply to other related lesser offenses in a complaint: If you were the respondent (aka defendant) REALTOR® in this complaint would you have considered taking an offered citation (small fine and education) in lieu of a full formal ethics hearing or waiving your right to a full formal hearing and accepting the fine and education imposed by the ethics committee who takes into account your admission of unprofessional behavior (aka take a plea deal)?]
SCR is receiving numerous reports of unprofessional behavior. Across the country, unprofessional behavior is the number #1 complaint by REALTORS® about their colleagues in the market.
There are several ways of addressing and trying to correct unprofessional behavior. Lead by example. If you see unprofessional behavior, say something. Discuss with the other REALTOR®. Discuss with the REALTOR®’s Broker-in-Charge (BIC). Consider filing ethics complaints at the appropriate association and filing license law complaints at LLR.
REALTORS® have an ethical duty to report fair housing/discrimination issues, fraud resulting in substantial economic harm, and misappropriation of client/customer funds/property.
REALTORS® having direct personal knowledge of conduct that may violate the Code of Ethics involving
Misappropriation of client or customer funds or property…
Fraud resulting in substantial economic harm…
bring such matters to the attention of the appropriate Board or Association of REALTORS®.
The Hearing Panel found REALTOR® A not in violation of Article 10. In their “Findings of Fact and Conclusions,” the panel noted that the use of “Choose Your Neighbor” letters is not a per se violation of Article 10, but cautioned that such letters could be used in a manner inconsistent with the intent of Article 10. If used in conjunction with other marketing techniques and not as a means of limiting or restricting access to property on the basis of race, color, sex, handicap, familial status, country of national origin, sexual orientation, or gender identity, “Choose Your Neighbor” letters were another method of announcing a property’s availability and attracting potential purchasers.
Posted by: Byron King on 06/17/20 (This information is only accurate as of 06/17/20. You must contact SCR for updates and changes to this information after 06/17/20 as laws and regulations may change over time. SCR 803-772-5206 or email Byron)