Leigh Thomas Brown tells brokers to enforce the 17-article Code of Ethics, not just real-estate regulations. Most agents stay legal but slip on ethics. Over 90% of reported violations don't happen again, so enforcement works.
I want to talk today to my broker friends. Now, North Carolina and Colorado, you're broker-only states. I'm not really talking to the day-to-day broker. I'm talking to the supervising broker, broker in charge, head broker, whatever you want to call the person who is the broker at the office. You know, like when a consumer calls and says, "I want to talk to the broker." That's who I'm talking to today. I got a message from a friend in another state who is the broker of her office. She's very frustrated right now because in today's market, with everything changing in structural real estate, and with so much fear and panic going on amongst those who do this every single day for a full-time career, there are agents that are now thinking outside the box. And when we think about what the box is in real estate, let's just define it very quickly. The box in real estate is the real estate commission guidelines wherever you live, whatever is governed by the general statutes, and it is The REALTOR® Code of Ethics, if you are a member of the National Association of REALTORS®. That's your box. Now, you can do a ton inside that. You can be super creative. It's part of why we do love having agents that are 1099s, because you look at your community, you look at your sphere, your special niche in the marketplace, your personality, how you can serve people. And as long as you're inside the rules of your state regulatory body and the REALTOR® Code of Ethics, as your broker, we are so proud of you. So when this broker reached out and said agents are outside the box, I can read between the lines. I know what that means. They're probably not violating the Real Estate Commission guidelines, because that's when you get the letter from the state. Because consumers do turn you into the state body, as well they should. In fact, if there's anything I have said to commenters in the wake of all these lawsuits and settlements, for all those people who are fussing about their agent, I ask them, "Did you ever turn them into the state?" And these people say, "No." Well, you don't get to complain if you don't turn them in. So that's one side of things, and that's general statutes, that's regulatory barriers and legal issues. I think most agents do try to operate inside that side of the box, but the code of ethics can wind up being a really interesting space for brokers to manage. Because A, you as a broker should have read the whole code of ethics. And I don't mean you went to ethics class and looked at the 4 articles that were kind of interesting today. I mean, you know, all 17 articles. And then most importantly, you're willing to enforce that code of ethics as a broker in your office. Now, there's always a little bit of a kerfuffle because real estate agents are 1099s for the most part. So we as brokers can't treat them like W-2s. We can't give them all these really strict rules and procedures. But we can have guidelines and we can have processes in our office that allow us to operate with a level of consistency and excellency. And when agents get outside of that, then we should talk to them as brokers. And in fact, when that code of ethics happens, we should be talking to them and say, "Look, you're operating outside of Article 12, Article 15. These things are happening. I want it fixed." We should call our own agents out. Now, if you, my broker friend, are talking about an agent in another office who's operating outside the Code of Ethics, you know what I'm going to say, right? You know, go ahead and say it at home. Mm-hmm. Yeah, turn them in. The whole point of the Code of Ethics is that it is really intended to be self-policed. And that means that when somebody's operating outside of it, we need to turn them in. We also know that in looking at the Code of Ethics, when we turn it in, over 90% of the cases that happen nationally in our local boards, that offender doesn't get called back in a second time. A lot of our agents are violating it without realizing it. And when we, the brokers, have read all 17 articles and we call somebody out for it, we're actually challenging them to get better. We got to stop thinking about it as being a burden or fussing at people or being a busybody or a snitch. Why don't we look at it as a level of excellence to which we have said we would subscribe, and we have to do better about enforcing that? I look at this as children. Many of us raise children. We set a box for our children to operate inside of. It's how our families operate. It's our expectations. And when they get outside of that, do you just let them get outside of that and go wild? No. Good parenting involves the one who gets outside the box, talking to them and bringing them back inside. You have so much freedom here, but we're not going to violate certain things. That's what being a broker looks like. So my suggestion to you is that you make sure all of your agents know that they are expected to not just be ethical, but to know the code of ethics in REALTOR® world and to live by it. And that they don't just have a pocket card that they pay a renewal on, but they understand that it's important to follow the general statutes and live up to the regulatory expectations of our state bodies. That's a broker job. Get out there and be successful with it.
