New REBNY fines are heaviest for bad data
Firms will be reviewed quarterly
The Real Estate Board of New York disclosed fines for data-sharing violations last week, and it turns out that the city’s residential agents may face up to $20,000 in penalties.
A closer look at REBNY’s new Universal Co-Brokerage Agreement (UCBA) reflects two categories of violations: one related to erroneous data and one for bad business conduct. Data problems carry the heftier fines.
For example, agents submitting a listing to the residential listing service (RLS) must fill out mandatory fields, including neighborhood, property type, room count and price. They can be fined if they insert their name and contact information into a listing, or if the listing contains a Fair Housing violation.
For the first notification, agents get three days to correct the listing and no fine. If an agent receives a second notification, they have two days to correct the listing and will be fined 0.5 percent of the list price up to $10,000 (or $1,200 for rentals). If agents are notified a third time, they have one day to fix the error and will be fined another 0.5 percent of the list price up to $10,000 (or $2,000 for rentals). If agents have to be notified a fourth time, their access to the RLS is terminated.
For Fair Housing violations, agents are first given two days to correct the listing plus a fine. A second violation warrants being suspended from the RLS.
REBNY officials said the second category of penalty relates to bad business behavior and covers things like agent poaching and excessive whisper listings. Those infractions can run an agent between $500 and $5,000, according to the UCBA.
The penalties were disclosed to agents in a Jan. 29 newsletter that broke down the details of REBNY’s new “Clean Data” initiative for brokers. The new rules take effect Feb. 5, but there is a three-month grace period for fines.
According to the UCBA, for behavior-related infractions, REBNY will fine agents $500 for the first offense; $2,000 for a second offense and $5,000 for a third offense. A fourth offense can result in suspension from the RLS. REBNY officials said those fines were in place before the new UCBA was published last week.
In addition to the fines, the new UCBA says that the RLS will conduct four quarterly reviews each year. If a brokerage firm has more than 5 percent of its listings rejected because of compliance violations, the firm will be fined $1,000. The penalty is payable within three days.
If a firm is fined three times in a calendar year, it may be suspended from the RLS for 30 days. At that time, the firm needs to demonstrate its changed its ways by adopting measures to prevent future violations.