Chapter 31: Professional Ethics
A situation where competitors agree to not compete with each other in specific markets by dividing up geographic areas, types of products, or types of customers.
Market Allocation
______ means a victim can sue. The plaintiff must be able to prove these five things: 1. A person makes a false statement about or omits a material fact that they have a legal duty to disclose. 2. The person making the statement knows or should know it is false. 3. The statement or concealment is made with the intent of inducing another to enter into a transaction. 4. The other person relies on the statement or omission to enter the transaction. 5. The other person is harmed as a result of entering the transaction.
Actual Fraud
A binding agreement reached before judgment in a court case by which the accused party consents to change its behavior without admitting wrongdoing.
Consent Decree
An area of law concerned with maintaining competition in private markets by prohibiting any restraint on trade.
Antitrust
Identify the statement that is TRUE. A) An agent may never call a consumer on the company's internal Do Not Call list, even if there is an EBR. B) Consumers must register every 90 days to maintain their phone numbers on the national Do Not Call registry. C) Consumers must register every year days to maintain their phone numbers on a specific company's internal list. D) Once an office establishes its internal Do Not Call list, it is not necessary to monitor the national Do Not Call Registry.
A) An agent may never call a consumer on the company's internal Do Not Call list, even if there is an EBR.
Phone calls from who are limited by the National Do Not Call Registry? Select all correct responses. A) businesses B) charities C) political organizations D) telemarketers
A) businesses D) telemarketers
What possible antitrust violation could be avoided by giving a client an affiliate disclosure form? A) group boycotting B) market allocation C) price-fixing D) tie-in agreement
A) group boycotting
If you have a client who questions your firm's commission fee, you should A) ask your employing broker if they would consider charging less. B) refuse to work with that client. C) show them the MLS guidelines on commission. D) tell them that your firm charges the standard commission rate.
B) refuse to work with that client.
Which federal law requires companies to take measures to secure and dispose of sensitive personal information of consumers? A) CAN-SPAM Act B) Do Not Call Act C) Fair and Accurate Credit Transaction Act D) Gramm-Leach-Bliley Act
C) Fair and Accurate Credit Transaction Act
Broker David sold a house to Sue eight months ago and just heard that she's getting transferred. Even though her name is on the National Do Not Call Registry, can David call her to see if she would list her house with him? A) No, since her name is on the national DNC Registry, she is protected from solicitation for new business. B) No, the transaction was so long ago that they no longer have an established business relationship. C) Yes, assuming that her name is not on his company's internal do not call list. D) Yes, they have an established business relationship that allows him to call her for up to 18 months with no restrictions.
C) Yes, assuming that her name is not on his company's internal do not call list.
Secret agreement or cooperation among people, especially for deceitful or fraudulent purposes.
Collusion
When a licensee uses or makes available to her personal or business use funds or other property belonging to another.
Conversion
Occurs if a licensee operates in a reckless, careless, and excessively negligent manner; is negligence for which one can be held legally accountable.
Culpable Negligence
If a local real estate board publishes a suggested commission schedule but does not mandate that members follow it, it would NOT be considered an antitrust violation.
False Price-fixing is per se an unreasonable restraint of trade, and, therefore, illegal under the Sherman Antitrust Act.
Something that is unlawful in and of itself without considering context or intent; generally made so because of statute, constitution, or case law.
Illegal Per Se
A court-ordered prohibition against a particular act, as opposed to a judgment for money.
Injunctive Relief
Hank and Russ are both sales agents for Northwoods Realty. At a company meeting, broker Bob told them not to accept any listing for less than 7%. Do you think this in an example of price-fixing?
No. Price-fixing is per se an unreasonable restraint of trade, but this conversation took place among agents of the same brokerage, not competing brokerages, so it is not price-fixing.
A consumer's personal financial information that would not be easily obtainable by the general public, such as credit reports, bank accounts, and transactions.
Nonpublic Personal Information