Article 12 of the NAR Code of Ethics is centered on advertising communications. Advertising can be in many forms, including Facebook.

Many portions of Article 12 (advertising) fall under the SCR citation program (aka ethics traffic tickets for less serious ethics violations, notably advertising ethics) whereby the respondent can accept any offered fine and education hours then move on with their career or request a full ethics hearing at SCR with the chance to be found not in violation but also the chance at receiving more fines/fees and education.

Serial repeat offenders and egregious offenders are unlikely to qualify for citations.

All citation level ethics offenses qualify for the new SCR anonymous complaint procedure approved by the SCR Board of Directors on October 17, 2018.

Complainants can remain anonymous to the respondent while filing citation level ethics complaints. If the respondent takes the citation, everyone moves on with their careers. If the respondent requests a full ethics hearing at SCR, the complainant may drop the complaint or drop their anonymity.

Both of these programs, citations and anonymous complaints were approved by the SCR Board of Directors in order to improve professionalism by encouraging the filing of ethics complaints to correct REALTORS® operating in violation of the NAR Code of Ethics.

Remember, the Code is good business as it lowers your risks (e.g. costs) to maximize your profits.

Suggested corrective actions when you see an advertising violation: communicate with the offending REALTOR® who is advertising, communicate with their BIC, file ethics complaints at the appropriate association, and consider filing license law complaints at LLR.

Case Interpretation 12-7:

Case #12-7: REALTOR® Ad vertising Free Market Analysis

(Reaffirmed Case #19-9 May, 1988. Transferred to Article 12 November, 1994. Revised November, 2001 and May, 2017.)

REALTOR® A advertised on his website as follows: “Free Market Analysis With No Obligation.”

A property owner complained about REALTOR® A’s attempts to solicit the listing, and the complaint was referred for a hearing before a Hearing Panel of the Professional Standards Committee.

At the hearing the property owner testified he had called REALTOR® A to have him prepare a market analysis of his residential property, “. . . with no obligation. . .” as claimed in REALTOR® A’s ads. However, the property owner said that when he and REALTOR® A spoke, he explained that he would be glad to provide the market analysis but said, “I presume you understand that when we provide this service, we also expect that if you list your property, you will permit us to serve you.” The property owner testified that REALTOR® A did not press the matter at the time and did provide a market analysis. The property owner told the panel that for the next three weeks REALTOR® A or one of his representatives called “practically every single day” soliciting the listing of his home. The property owner testified that on several occasions, someone from REALTOR® A’s office reminded him that REALTOR® A had provided a “valuable free service and we feel that you owe us the listing of the property.”

REALTOR® A responded that he had provided the “free market analysis” as represented in his advertising, and had provided it “. . . with no obligation.” He stated that he had neither asked for nor received a fee for the market analysis. He could not understand why he was required to appear before a Hearing Panel in connection with allegations of a violation of Article 12 of the Code of Ethics.

The Hearing Panel noted that offering premiums or prizes as inducements, or the advertising of anything described as “free” is not prohibited by the Code of Ethics nor can such advertising be prohibited by a Board of REALTORS® unless it presents other than a “true picture” as required by Article 12.

The Hearing Panel concluded that although REALTOR® A was free to advertise “free market analysis with no obligation,” such a representation was not a “true picture” if all of the terms governing availability are not clearly disclosed in the ad or representation. The Hearing Panel noted that the statement by REALTOR® A when he provided the “free market analysis” that it was “presumed” the property owner would list with REALTOR® A if the property was offered for sale, and the subsequent “reminders” by sales representatives of REALTOR® A about the “expectation” made the representation less than a “true picture.” The panel concluded that REALTOR® A was in violation of Article 12.

Posted by : Byron King on 10/22/18 (This information is only accurate as of 10/22/18. You must contact SCR for updates and changes to this information after 10/22/18 as laws and regulations may change over time. SCR 803-772-5206 or email info at screaltors.org)