The Code of Ethics

But there are also differences between ethics hearings, which only deal with the code of ethics, and arbitration proceedings.

“In an ethics hearing, we are determining if one of the 17 articles of the code of ethics was violated, and we provide the parties a hearing that ensures due process,” Lackie says. “In an arbitration proceeding, we are trying to resolve commission disputes between agents and determine who deserves a disputed commission.”

Both ethics hearings and arbitration proceedings serve very important roles, with the goal being to elevate professional business conduct and make sure violations of the code are rigorously enforced. Commission disputes resulting in either mediated settlements or arbitration hearings also serve an important function for the board, and having a mechanism in place to solve commission disputes allows for quick resolution and does not tie up the court system.

In a broad sense, the code of ethics serves to enforce the Golden Rule, according to MacArtney: treat all parties fairly and honestly, as you would have others treat you. The Grievance and Professional Standards Committees serve as a mechanism to enforce that code.

“We strive as an industry to be as professional as we can in the eyes of the public, and the code of ethics takes us a long way in doing that,” he says. “I know of no other industry that has as efficient an enforcement mechanism in place. We take the code very seriously, and agents should know that it is for the benefit of the industry and their own business; so, they should be familiar with the contents of the code and how it is enforced.”

Maintaining such high standards is a daunting task, but Withrow says this industry calls for the extra effort. “NAR requires that all Realtor members participate in an ethics continuing education or refresher course once every four years,” she says. “Additionally, we continually offer educational opportunities throughout the market, as well as at brokerage offices, to better assist managing brokers in delivering timely and relevant education to their brokers.”

Over the past few years, licensing requirements have strengthened in Illinois, as well – licensing requirements are more stringent for brokers and managing broker qualifications as an offshoot of those high standards. The 2013 National Association of Realtors Profile of Real Estate Firms reveals that more than eight in 10 real estate firms have licensees with professional certifications or designations, and more than six out of 10 firms provide training and education programs for their staff or sales agents. The typical firm requires new agents to receive a median of 21 hours of training and continuing education annually, while experienced agents acquire 12 hours.

Many of the common complaints brought in front of the Grievance Committee arise from a lack of disclosure of known latent defects relating to the property or the transaction, including false or misleading advertisement, as well as not ensuring all agreements are in writing and interfering with established agency relationships.

“Some recent cases that come to mind include commingling of escrow monies, as well as Realtors making disparaging remarks about other agents to their clients,” Withrow said. “A recent, unfortunate trend is Realtors providing unauthorized access to listed properties to their client without them being present, whether it is by lockbox code or providing a key.”