Broker Accountability: Part I

What does accountability mean to you? Merriam-Webster defines it as “an obligation or willingness to accept responsibility.”

Broker accountability remains a topic of significant interest within the industry. Brokers have a unique role to play within Alberta’s real estate industry; one that goes far beyond simply providing ethical, competent, professional service to consumers. A broker’s role within a brokerage requires
that he or she take responsibility and be held accountable for all activities carried out by the brokerage and its authorized industry professionals (s.51(1) of the Rules).

Today’s blog is the first of three on broker accountability and what it means in the day-to-day operation of a brokerage.

Real estate and mortgage brokers must:

• Be actively engaged in the management of the brokerage;
• Trade in real estate/ deal in mortgages only in the name of the brokerage;
• Ensure the name of the brokerage is clearly indicated in all advertising (including all advertising by individuals registered with the brokerage);
• Ensure the business of the brokerage is  carried out competently and in accordance with the legislation;

But what do those things actually mean?

Being actively engaged in the management of the brokerage means being a hands-on broker who is accountable for the actions of industry members registered with the brokerage and all employees of the brokerage. Some of the things RECA may review in determining whether a broker is “actively engaged in the management” of the brokerage, include:

• the process for recruiting and screening new industry members;
• being present in the brokerage on a regular basis and otherwise available when out of the office;
• providing management oversight to the accounting and conveyancing staff;
• the broker’s monitoring of the activities of any industry members who have been disciplined by the Real Estate Council of Alberta;
• whether the broker notifies the Real Estate Council of Alberta of changes of information given to the Real Estate Council of Alberta as soon as the change occurs.

And while RECA recognizes that in large brokerages it may be almost impossible for a broker to single-handedly review every industry member advertisement, website or social media profile page – brokers need to have policies in place to deal with advertising by industry members, particularly when non-compliant advertisements are brought to their attention.

As for ensuring the business of the brokerage is carried out competently and in accordance with the legislation – it’s a multi-step responsibility. It is not enough for brokers to simply be familiar with the Rules, they must also be familiar with how they are to be applied to all aspects of the brokerage’s operation, brokers need to ensure they remain current with the Rules/legislation and all other legislation that may affect the operation of the brokerage. Brokers also have a special responsibility for sharing that information with and teaching employees and industry members registered with their brokerage, to ensure their associates and staff are compliant, current and competent.

How does your broker demonstrate accountability?

How does your broker measure up against this enormous responsibility?