Risk Management Uncategorized

'Cite and Fine' Regulations

Most states have very comprehensive real estate licensing laws. I’ve written about them in several books, as well as taught them for years in pre-license and continuing education courses. The problem has been with the lack of enforcement due greatly to the human resources and expense required for disciplinary administrative hearings.

California has just introduced a “cite and fine” program for real estate — it is not unlike the issuance of traffic citations. According to the California Bureau of Real Estate, “a citation or other formal action will be considered when a violation is found after an investigation, audit, or examination of a licensee’s records by CalBRE in response to a complaint, through random selection of a licensee for an office visit, or from completion of a routine audit. Depending upon the nature (such as the level of seriousness and potential for harm) and type of the violation, the appropriate action will be determined.”

The Bureau says that “a citation is likely the appropriate action” in cases of “relatively minor and technical violations, especially in those instances where there has been no injury or loss to a consumer…The citation will identify the violation(s) you committed, provide information on how to pay the fine, describe any corrective action needed (if necessary), and explain the process for contesting the citation, if you choose to.”

The new law is found in Business and Professions Code 10080.9 and Commissioner’s Regulations 2907 (effective July 1, 2014). It applies to licensees as well as to unlicensed persons who are doing things that require licensure.  The Bureau “considers the issuance of citations an opportunity to help educate both licensees and nonlicensees alike and to encourage and reinforce compliance with Real Estate Law.”

Last week I happened to drive by a neighborhood in which I counted 12 Open House signs by one broker within 100 yards of the subject property. In addition to confiscating the signs, I wonder if the government’s issuance of a fine would help persuade the broker to take a more common sense approach to promoting the open house.

Source: Bob Hunt, Realty Times 

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