Mastering Compliance: Key Insights for Real Estate Brokers in the Digital Advertising Landscape
In the fast-paced world of real estate, brokers need to stay up to date with the ever-changing rules and regulations governing digital and social media advertising. Failure to comply with these regulations can lead to fines and penalties. In this blog post, we will explore the key compliance issues and provide valuable insights from Stephanie Wilson, an attorney with Bell & Shaw, formerly with IDFPR (Illinois Department of Financial and Professional Regulation).
- Keeping Up with the Rules: Stephanie emphasizes the importance of staying updated with the ever-changing rules set by IDFPR. Brokers can easily access detailed information on regulations by visiting IDFPR's website. Stephanie highlights that reading the website is much simpler than deciphering the dry legal statutes.
- General Requirements: Digital marketing and paper advertising share similar requirements at a high level. Brokers must ensure their advertisements include their name or team name, their brokerage, the location of the brokerage, and, if applicable, the location of the specific property being advertised. Accuracy and non-misleading information are vital aspects to consider when creating advertisements.
- The Font Size Factor: Consistency in font sizes is crucial for compliance. Brokers need to pay attention to font sizes when including their team name, their own name, and the sponsoring brokerage's name. These elements should have the same font size or, if using a logo, should have the same size logo. Ensuring consistency requires regular audits of all advertisements.
- Common Compliance Issues: Stephanie sheds light on some common compliance issues brokers often overlook. One significant issue is the use of misleading team names (cannot use words like realty, company, real estate, etc). Brokers must ensure that their team names comply with the specific terms outlined by IDFPR to avoid penalties. Additionally, the inclusion of required information within advertisements is crucial. Even on platforms with character restrictions like Twitter, brokers must ensure the necessary information is easily accessible with just one click.
- Additional Compliance Considerations: Stephanie mentions a few additional compliance considerations. Brokers must appropriately categorize virtually staged images to avoid misleading potential buyers. It's also crucial to ensure that listings accurately reflect their status, whether active or under contract. Finally, brokers should refrain from using nicknames without proper registration with the IDFPR.
- Compliance and Enforcement: IDFPR does not actively seek out fines or penalties, but brokers can be reported by competitors or trolls. Stephanie clarifies that IDFPR lacks the resources to police every broker's advertising practices. However, brokers must not take compliance lightly, as non-compliance can still result in penalties. It's important to remember that just because others may get away with non-compliant practices, it doesn't exempt anyone from potential consequences.
- Penalties and Fines: The fines for non-compliance can vary, typically ranging from a few thousand dollars to a maximum of around ten thousand dollars per instance. IDFPR's goal is not to bankrupt brokers but to enforce compliance. In some cases, fines may be accompanied by requirements for continuing education.
Compliance is an integral part of digital and social media advertising for real estate brokers. Understanding and adhering to the rules and regulations set by IDFPR is crucial for avoiding fines and penalties. By staying informed, maintaining accurate and non-misleading advertisements, ensuring font size consistency, and addressing common compliance issues, brokers can navigate the compliance landscape successfully.