Recently the Cal BRE sent out an alert to all CA real estate licensees titled, “Supplemental Disciplinary Advisory to Real Estate Salespersons Who Mislead Consumers into Falsely Believing that They are Brokers –and a Concurrent Caution to the “[Ir]responsible” Brokers Who Permit or Support Such Practices.” Whew! So what does that mean exactly?
This alert was a follow up to a similar one sent in September 2015. Basically what Cal BRE is doing is cracking down on sales licensees who are marketing themselves as a team, group, or other entity, “which may mislead consumers into falsely believing that such salespersons are real estate brokers.” You see in CA there is a two-tiered licensing system, salesperson and broker. A salesperson licensee MUST hang their license with a broker, who is responsible for that licensee, and must provide a certain level of over- sight.
Over the past decade we have seen a rise in the “Team” concept, whereby sales licensees build teams of agents, typically under a broker, and promote and market the team brand. That is perfectly OK per Cal BRE as long as certain guidelines and laws are followed. For example, if you use your surname, along with the words “team, group, or associates”, you are good to go as long as you also display the Cal BRE license number of one of the team members. Rules also dictate that the responsible broker’s logo be displayed in a conspicuous manner in the marketing material. So, “Lopez and Associates” would be OK. Also, if an agent works as a solo practitioner they cannot promote themselves as a team or group. There must be two or more licensees working together.
I think where the confusion sets in is when an agent decides to use a Ficticious Business Name, or FBN. In this scenario the agent must first file the FBN statement with the county they work in, pay the fees to do so, and also publish the FBN once a week for 4 weeks. They must then submit the FBN statement to Cal BRE for approval, and the FBN cannot be used or promoted until approved by Cal BRE and attached to the managing brokers license.
The moral of this story is, “Do the right thing.” By simply following the rules you can avoid scrutiny, monetary fines and customer service issues that can arise. The rules are in place to protect the public interest and insure a level playing field for all practitioners. For more information and full details you can follow this link.