January 19, 2012
Professional Standards Committee
The following has NOT been approved by the Professional Standards Committee, Executive Committee or the Board of Directors.
Article IV, Section 2, of the NAR Bylaws prohibits a Member A.O.R. from knowingly granting REALTOR® or REALTOR-ASSOCIATE® membership to any applicant who has an unfulfilled sanction pending which was imposed by another Association for violation of the Code of Ethics. Further, an Association may consider information received from other Associations in determining whether an applicant satisfies the A.O.R.'s membership requirements, including, but not limited to, all final findings of Code of Ethics violations and violations of other membership duties within the past three (3) years – even if the sanction has already been satisfied.
Issue:
In order to assist local Associations make their membership decisions, should C.A.R create a database that contains all final findings – within the last three (3) years – of a member’s Code of Ethics and membership duty violations, including whether the member fulfilled the sanction imposed?
Options:
Adopt Motions for any of the following:
1. Approve that C.A.R. build a system, to be developed by staff, to create a database that contains all final findings – within the last three (3) years – of a member’s Code of Ethics and membership duty violations, including whether the member fulfilled the sanction imposed, for use by local Associations in making their decision on membership applications.
2. Take no action.
Background:
NAR Bylaws prohibit an Association from knowingly granting membership to any applicant who has an unfulfilled sanction imposed by another Association for violation of the Code of Ethics. In addition, the Association may consider any final findings that the applicant was in violation of the Code of Ethics or membership duty, within the last three (3) years.
The problem often faced by Associations, trying to make an application decision, is that the applicant does not always disclose the other Associations of which they are currently or have previously been a member. In addition, if the applicant is or has been a member of multiple associations, the information-gathering process can be a long and tedious chore. If C.A.R. maintained a central database with the necessary information, a local Association in California would have access to exactly what it needs – in one step.
What about confidentiality? Policy Statement 19 of The NAR Code of Ethics and Arbitration Manual establishes an exception to confidentiality when that circumstance is permitted by the Manual. Part Four – The Ethics Hearing, Section 23(j), of the Manual, establishes one of a number of exceptions to confidentiality by the language: “Upon final action by the Directors, the President shall disseminate to the … President of any other Board in which the respondent holds membership … notice of the action ….” Finally, the circle is complete with the NAR Bylaws that allow a local association to use information about prior violations and non-fulfillment of sanctions in deciding whether to grant membership to an applicant. Since C.A.R. is another Association of which the applicant was in the past or currently is a member, there is no bar to the locals sharing violation information with C.A.R. or to C.A.R. sharing the information with other locals where the individual has applied for membership.
Conclusion:
The question is whether C.A.R. should implement a system to create a database that contains all final findings – within the last three (3) years – of a member’s Code of Ethics and membership duty violations, including whether the member fulfilled the sanction imposed, to be used by local Associations in making their decision on membership applications. If the Committee and C.A.R. Directors approve such a system, C.A.R. staff would be tasked with developing the program and making necessary changes to the C.A.R. Code of Ethics and Arbitration Manual.
