Properly Addressing Ethical Complaints in Real Estate

Real estate agents know that building relationships with clients is all about trust. Part of ensuring your credibility means abiding by the real estate code of ethics. But what happens when an ethical complaint from a client or the Department of Real Estate arises? This situation can be incredibly worrisome because it can put your real estate license and career in danger. Luckily, there are ways to handle it correctly. Below you’ll learn more about how to properly handle ethical complaints and when to seek help from a professional license defense attorney.

Ethical Complaints Defined

Unfortunately, many ethical violations among real estate agents occur unintentionally or due to ignorance. The most common complaints made against agents are fraud, breach of duty and breach of contract.

  • In the case of fraud, the agent intentionally conceals issues with the property.
  • In breach of duty violations, the agent does not act in their client’s best interest.
  • In breach of contract violations, the agent has not adhered to the terms of the contract.

Needless to say, it is important that you carefully review all contracts and ensure that you are aware of all issues with a property so that you can properly explain them to your clients.

Ethical Complaint Scenarios

If a client believes you have treated them unfairly by violating the real estate code of ethics, they can hire a lawyer to pursue a case against you or your firm, file a complaint with an official real estate regulatory body such as the Department of Real Estate who may take action against you, or use the National Association of Realtors’ dispute resolution process.

The NAR process may include negotiation, mediation or arbitration. The system is designed to quickly resolve disputes between clients and agents without taking a case to court. By complying with the NAR system, you can resolve the issue quickly and professionally without putting your license at risk.

License Issues After a Complaint

Depending on the nature of the complaint, the agent may simply receive a warning from the Department of Real Estate. Others may face more severe punishments including requirements to participate in courses or seminars, up to $15,000 in fines, suspension of their membership or expulsion from the association.

No matter what type of punishment you receive, it is in your best interest to respond respectfully and follow all requirements given to you. This will improve the likelihood of getting your real estate license back in the case of suspension.

Seeking Help from a Professional License Defense Attorney

If you feel you were treated unfairly by the Department of Real Estate after an ethical complaint, you may benefit from hiring a professional license defense attorney. If you need a lawyer with experience in real estate license law, Scott J Harris can help.  Contact him for a free 30-minute consultation at his Los Angeles office at 323-794-0701.

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This blog is meant to be informational. It is not meant to be all-encompassing legal advice. If you are facing a situation involving your professional license, seek counsel from a licensed attorney.