February 8, 2015
In the most recent issue of the TREC Real Estate Advisor newsletter the Texas Real Estate Commission posted the list of top complaints made against real estate licensees in Texas. This list is similar to other states where VanEd offers licensing programs and CE coursework, so we are re-posting the list here for our students. A link to the full TREC Advisor is posted below.
What are TREC’s Top Complaints?
Last June 2013, we discussed TREC’s top complaints ("What Am I Doing Wrong?"). As we start 2015, here’s an update for 2014.
What Am I Doing Wrong?
Probably nothing. 99 percent of real estate agents have no violations in the past two to three years. Since we all want to keep it that way (or do even better), we’ll list the various categories of violations and let you know the rough percentage for each.
The Subjects of TREC Complaints
Despite the low number of violations, the Standards & Enforcement Services Division is frequently asked – what are your top complaints?
The division received over 1000 complaints related to brokers and sales agents in Fiscal Year 2014 (September 2013 through August 2014). Based on data tracked from fiscal year 2014, as well as staff impressions, here is what we are seeing a lot of:
About 22 percent of complaints relate to leasing and property management (mostly the latter):
- Leasing/Property Management - Misappropriation, includes misappropriation, commingling, and failure to properly account for money
- Leasing/Property Management - Other, includes general negligence, referrals, etc.
About 8 percent of complaints relate to advertising
About 8 percent of complaints relate to unlicensed activity
About 6 percent of complaints relate to licensure issues such as criminal background history, application disapprovals, probationary licenses, etc.
About 6 percent of complaints relate to broker supervision, which is a broker’s failure to supervise sponsored salespersons
About 5 percent of complaints relate to a breach of fiduciary duty, which includes false promises
About 5 percent of complaints relate to TREC administrative actions such as bad checks to the agency, or a license holder’s failure to cooperate or to provide current contact information, etc.
And about 33 percent of complaints are in the miscellaneous category of "Sales – Other", which includes general negligence, rebates, improper referrals, and earnest money issues
? What else?
We also receive a number of complaints related to a license holder’s actions as a principal in a transaction (about 3 percent), failure to disclose (about 2 percent), intermediary/IABS violations (about 1.5 percent), improper form usage (about half a percent), and sales misappropriation (about half a percent).
We receive a large number of inquiries related to advertising, but we do not receive a large percentage of signed complaints on that issue. Because we do not accept anonymous complaints and typically cannot conduct a covert investigation, we are very limited in what we can do with an unsigned complaint.
In addition, we frequently enforce issues arising out of criminal background checks on renewals when the license holder fails to timely disclose a plea of guilty or nolo contendere to a criminal offense involving a felony or fraud (under "licensure issues" above). Another area where we frequently find violations is a broker’s failure to register the broker’s or salesperson’s dba or assumed name with us (under "administrative" above).
Where can I find out more?
If you want to know more, please go to the "Complaints" tab and then the "disciplinary actions" section (left side of page) on our website www.trec.texas.gov. That area provides some details regarding many of the complaints (see also this newsletter under "TREC Enforcement Actions"). The Enforcement FAQs (in the same section on our website) address many other recurring issues, including some examples. Finally, we publish a monthly staff report called "Complaint Subject Categories" which details the categories and percentages cited in this article. That report is on our website under the "News & Public Data" tab and "Monthly Staff Reports" (on the left side of the page).
The TREC Real Estate Advisor newsletter is published regularly and can be accessed online at the TREC Website.