Monkey See, Monkey Do — No Thank You

Lessons learned from recent REEB disciplinary actions


 Cori Lamont  |    August 04, 2017
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In general terms, the phrase “monkey see, monkey do” refers to the act of learning something without an understanding of its importance and instead just mimicking the act. “Monkey see, monkey do” also includes lacking a full understanding of the consequences of mimicking the act. For REALTORS®, understanding the laws, office policies, REALTOR® Code of Ethics and how they impact your practice is essential.

Your real estate practice is guided by federal and state law, the REALTOR® Code of Ethics if you’re a REALTOR®, company policy and whatever those guidelines don’t offer, your own moral compass. All real estate licensees are subject to discipline by the REEB as well as litigation. At this time, while the statute of limitations to sue real estate licensees for a transaction is two years — effective for transactions March 4, 2016, and after, complaints may be filed at the Department of Safety and Professional Services (DSPS) for an indefinite amount of time. 

Over the last few years, the WRA has sent out periodic reports as to the activities at the DSPS affecting your practice. Dubbed the DSPS Report, this report is included in the WRA Legal News email and is sent out in lieu of the WRA Legal Hottips Q&As because it’s as equally important to understand the questions REALTOR® members are asking the WRA Legal Hotline as it is to understand the matters of discipline impacting fellow licensees. 

The following examples of recent DSPS disciplinary cases are examples of what not to do. So it’s more of a monkey see, monkey do — no thank you. Keep in mind, that limited facts of the disciplinary cases are published by the DSPS, therefore, some of the insight behind the decisions is not available. 

Know who is inspecting the property

Facts: The salesperson license was first issued on August 8, 2014, and current through December 14, 2016. On September 3, 2015, the department received a complaint regarding a transaction handled by the salesperson and opened an investigation. On March 5, 2015, the salesperson drafted an offer to purchase on behalf of the buyer. The offer included an inspection contingency and a requirement that earnest money be mailed or delivered within three days of acceptance. On March 6, 2015, the buyer was presented the counter-offer and accepted, signed and delivered the counter-offer back. On March 3, 2015, the buyer requested a walk-through of the property, which the salesperson scheduled for March 7, 2015. The salesperson attended the walk-through but did not go into the property. The buyer was accompanied by an unregistered inspector. On March 10, 2015, the seller’s agent contacted the salesperson and indicated the earnest money had not been received. The salesperson stated that he would check with the buyer and get back to the listing agent. The salesperson contacted the buyer about the earnest money and to set up an inspection. The buyer indicated that the inspection had already occurred and that it was the walk-through on March 7, 2015. The buyer stated that he would not send the earnest money until a lower price was accepted due to the unsatisfactory inspection. The “property inspection form” listed interior and exterior issues with estimated repair costs up to $46,990. On March 13, 2015, the salesperson contacted the listing agent to inform him the inspection had been done and the buyer reported several issues with the property, including the need for new windows and issues with electric panels. The salesperson informed the listing agent that the buyer refused to submit the earnest money until the inspection issues were worked out. Later that day, the salesperson informed the listing agent that the buyer wanted to drop the purchase price by $14,900. On April 1, 2015, after not being able to reach a mutually agreeable resolution, the seller and buyer signed a Cancellation Agreement & Mutual Release terminating the transaction. 

Violations: The salesperson violated Wis. Stat. § 452.133(1)(b) by failing to provide brokerage services with reasonable skill and care as well as Wis. Admin. Code § REEB 24.03(2)(a) by providing services that he was not competent to provide without engaging the assistance of one who is competent. 

Discipline: The salesperson’s license was limited as follows: Within 90 days, the salesperson shall complete and provide evidence to the DSPS of six hours of education on the top of real estate contracts and pay costs of $580.

Report crimes to the DSPS within 48 hours

Facts: The broker’s license was first issued November 10, 2006, and current through December 14, 2018. On December 21, 2015, the broker pled guilty to and was convicted of disorderly conduct, which is considered a misdemeanor, in Winnebago County Circuit Court. The criminal complaint alleged that on June 19, 2015, the broker yelled and pounded on his neighbor’s house outside of the neighbor’s bedroom window. He was fined $1,270 and ordered to pay costs and additional fees of $1,191.31 and restitution of $4,146.16. The broker reported the conviction to the department on January 19, 2016. 

Violations: The broker violated Wis. Admin. Code § REEB 24.17(1) by violating a law that substantially relates to the practice of real estate and Wis. Admin. Code § REEB 24.17(1) by failing to send to the board within 48 hours after the judgment of conviction. 

Discipline: The broker agreed in stipulation to pay costs of $266 within 90 days. 

Executing a client’s desired agency model

Facts: The business entity license was first issued July 11, 1950, and current through December 14, 2018. On June 27, 2013, the board reprimanded the entity for failing to supervise the activities of a licensed employee. On June 29, 2015, the department received a complaint regarding a transaction handled by an agent of the entity. On February 19, 2014, the sellers signed a listing agreement with the agent. The sellers consented to multiple representation with designated agency relationship. 

On September 15, 2014, Racine County Circuit Court ordered a price reduction schedule for the property. The sellers were ordered to reduce the price by 1 percent on the first of every month until January 1, 2015. The agent was made aware of this order. 

On February 4, 2015, Racine County Circuit Court ordered the price to be lowered to $640,000. The agent was made aware of this order. On February 19, 2015, in a new disclosure of agency document, the sellers consented to multiple representation without designated agency, which is a deviation from the agency relationship previously consented. On March 12, 2015, the agent entered into a buyer agency agreement with a buyer for the sellers’ property and drafted an offer to purchase on behalf of the buyer. On March 16, 2015, the agent disclosed to the sellers via email that she was an agent for both the buyer and sellers. One of the sellers responded by stating she wanted the agent to represent the sellers exclusively. On March 23, 2015, the seller emailed the agent and expressed her displeasure with the representation issue. The agent consulted the firm’s legal counsel on the agency issue and the agent was advised to represent the buyer and get another agent for the sellers. On April 30, 2015, the transaction closed. The agent attended the closing as the agent for the buyer while another agent from the firm represented the sellers. 

Violations: The business entity violated Wis. Stat. § 452.133(1)(b) by failing to provide brokerage services with reasonable skill and care and Wis. Admin. Code § REEB 17.08(1) by failing to supervise the activities of any licensee employed by the broker-employer. 

Discipline: The business entity entered into a stipulation agreeing as follows: Within 90 days, pay costs of $320. 

Committing a crime substantially relating to real estate practice

Facts: The broker’s license was first issued May 2, 1978, and current through December 14, 2018. On December 14, 2016, the department received a complaint alleging that on July 6, 2016, while conducting an appraisal of a property in Columbia County, the broker was observed via a surveillance camera to be going through the homeowners’ personal belongings and placing items in his pockets for his personal use. Review of the surveillance video shows the broker taking items out of a tackle box and placing them into his pockets. The Columbia County Sheriff’s Department Incident Report indicated that the broker did not have the homeowners’ consent to take their personal belongings, and the broker admitted to taking the belongings. On August 15, 2016, the broker was charged with theft of movable property less than or equal to $2,500, considered a misdemeanor, in Columbia County Circuit Court. 

Violations: The broker violated Wis. Admin. Code § REEB 24.17(1) by violating a law that substantially relates to the practice of real estate and Wis. Admin. Code § 24.03(2)(b) by failing to act to protect the public against fraud, misrepresentation and unethical practices. 

Board determination: The broker agreed to a permanent surrender of his real estate broker’s license. 

For more information about disciplinary actions and orders from the REEB, visit the REEB’s online lookup at dsps.wi.gov/Other-Services/Look-Up-Orders-and-Disciplinary-Actions. You can search by board or by license.

This information includes disciplinary actions from December 9, 2016 – June 14, 2017. In addition to the above-noted disciplines, during this time there were four real estate broker’s licenses and one real estate salesperson license returned to full, unrestricted status after fulfilling previously determined disciplinary orders.

Resources

All of the above disciplinary cases included violations relating to Wis. Stat. Chap. 452 and Wis. Admin. Code Chap. REEB 24. You can find copies of the statute and rule language at the following: 

  • Wis. Stat. Chap. 452 at docs.legis.wisconsin.gov/statutes/statutes/452
  • Wis. Admin. Code Chap. REEB 24 at https://docs.legis.wisconsin.gov/code/admin_code/reeb/24.
  • Cori Lamont is Director of Corporate and Regulatory Affairs for the WRA.
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