From: Jay Reifert [true-agents@true-agent.com] Sent: Sunday, January 27, 2002 4:56 PM To: Oppose the WRA--Defeat Designated Agency Subject: Murder, Theft & the Wisconsin Realtors Association [This message is going out to thousands of Wisconsin Realtors, almost 500 governmental officials--including all State Legislators and their respective staffs, the Governor of Wisconsin, most candidates for Governor of Wisconsin, the Attorney General of Wisconsin, over 425 Consumer Advocacy Groups and/or individual Consumer Advocates, over 285 Registered Wisconsin Lobbyists and over 190 Media Outlets and more and more consumers every day. (Note: In the last message, I mistakenly overreported the number of media outlets on this list and underreported the number of consumer advocates. The numbers in this message are accurate and I regret the error in the last message.)] ------------------------------------------------------------- Murder, Theft and the Wisconsin Realtors Association Hard to envision how all of these things fit together? Be patient and open-minded and you will see. While I received many positive responses to my last message--the one encouraging all people on this list to take a stand against the Wisconsin Realtors Association's, WRA's, desire to pass a deceptive, fatally-flawed, anti-consumer piece of legislation called Designated Agency--there was a small handful of Realtors who wrote me saying that I must really think they are a bunch of crooks and are totally lacking in ethics. Nothing could be farther from the truth. Here are some, in context, anonymous quotes: "...ethics belong to the individual, and strength of character dictates how true an individual is to their code. Try to have more faith in your fellow realtors - we aren't all that bad." --ST "You seem to have placed yourself upon some sort of ethical pedestal. Are we all crooks but you?" --DM "Apparently you have no faith in the integrity of individual agents and their ability to properly serve their clients." --MJ My friends...this is not about you. This is about creating a law that allows the UNETHICAL and DISHONEST among us--or who wish to become one of our number--to abuse the home buying and selling public by using the flaws and deceptions that will be allowed/encouraged under the proposed Designated Agency law. ----------------- Prior to 1994 in Wisconsin, the common law of agency determined the legal duties that firms who offered agency level services were to provide their clients...those people who hired them to protect their interests and serve as advocates for their positions. (That would be buyer OR seller clients.) The legal mandate under the common law of agency is that the agent/firm must put the interests of the client ahead of all others, including the agent's own interests. (There is not now--nor has there ever been--any higher standard.) The common law of agency is also about minimizing the number of conflicts of interest to which the client is exposed...AND disclosing to the client ANY instances where any known conflict of interest pre-exists...or arises. The most common conflict of interest when dealing with companies that represent both seller interests and buyer interests in the same transaction, is the conflict of interest between the desire of the seller to get the highest price/best possible terms and the buyer's desire to get the lowest price/best possible terms. However, it is NOT the only conflict. The next biggest conflict is between the brokerage and each respective client in the transaction. It is in the best interest of the brokerage to put the deal together. When ONE brokerage has the ability to exercise influence and--ostensibly--control over two parties in the same transaction, the firm has opportunity, in addition to motive, to engage in dealmaking, instead of watching out for each client's respective best interests. The firm also can exert both intended and unintended pressure on its agents--by the way, that's the real reason why licensees are called agents...because they are, and always have been, agents of the company--to bring the deal together. (You licensees do know that you owe fiduciary duties to your company, don't you?) For instance: Does your company offer sales contests or other incentives for you to rack up the most sales in a given time period? Does your company give major consideration to your sales volume when deciding whether or not to move you into a management position? (Especially a sales management position?) Does your company offer a different fee split to YOU, based on whether or not you are helping a buyer purchase a company controlled listing instead of another brokerage house's listing? These are just a few examples of the pressures which exist in your sales environment that can lead to conflicts with the best interests of your clients, both buyers and sellers. The only firms who can avoid these conflicts, would be firms that offer agency-level services ONLY to sellers or firms that offer agency level services ONLY to buyers. It is perfectly appropriate for firms who do not offer any buyer agency services to engage in all of the activities mentioned above, because they only represent seller interests and hence only offer customer level services to buyers. For a firm that does not offer any seller representation, but only buyer representation--or for a firm that offers both it would be wholly inappropriate to generate such conflicts as mentioned above as such incentives compete with the best interests of one or even both clients. The obligation of every buyer agent has to be to work toward getting their client the lowest price at the best possible terms on the home that the client wants. Conflicts with your clients best interests, must be disclosed--in advance of offering services--or, if the conflict arises after the relationship begins, the conflict must be disclosed immediately upon realization of its existence. Designated Agency takes what used to be illegal--UNdisclosed dual agency--and gives it the seal of government approval. It allows any UNETHICAL licensee or broker/owner to take advantage of the relationship with one or both clients to benefit the licensee or broker/owner ALL WITH THE BLESSING OF THE LAW. Can you think of ANY other law that was created with the foreknowledge that such a loophole exists? A law that would allow unethical...even criminal behavior to be protected and moreover encouraged by its mere existence? No. Laws are there to protect, not to allow for deception or willful subversion of the law. So, unless you are one who would abuse the law, my opposition to Designated Agency is not directed at you. But, regardless of where it is directed, it is bad for all of our reputations and for our industry and State to allow the introduction of a practice that allows unethical and criminal behavior to not only exist...but to be protected and thus encouraged by the law. That is exactly what Designated Agency does. If you still choose to think that this is about your ethics and/or honesty, consider the following... Would you--if you could--repeal our laws against murder? Why not? Certainly you would not commit murder... Would you--if you could--repeal the laws that prohibit theft? Why not? Certainly you would not steal... These laws are not there to keep YOU from violating them...they are there to protect us from the ethically challenged and the criminals among us--both white collar and other--that do exist. Finally, let's consider Enron. Would you eliminate the legal right of a shareholder to be presented with a fair and accurate picture of the financial condition of a company whose stock s/he is holding and/or considering? What about the laws that apply to insider trading? Or what about laws that pertain to fraud? Just because you wouldn't engage in such practices, doesn't mean that the protection should not be there. Just ask the pensioners and private citizens that held Enron stock and lost BILLIONS...including many who lost the majority of what they had in life savings, how they would feel about the repeal of such laws. It is time for the Mega-Brokerage houses that control the WRA to stop trying to legislate away conflicts of interest. They can't be legislated away. The honest way to deal with this would be for those companies who want to work both sides of the transaction with reduced liability, is to act as facilitators. As facilitators, those who wanted to sell--without worrying about providing agency-level services--could sell and those who wanted to take on the higher level duties of the common law agent could do so, provided--if they worked for companies that represented both buyers and sellers--they made all prospective clients aware, in advance of providing brokerage services, that they could possibly have to transition to being a facilitator if one client became interested in the property of another client. Designated Agency is bad for Wisconsin buyers and sellers and the Mega-Brokers who control the Wisconsin Realtors Association are intent on blasting this law through the legislature without any interference or input from consumers. What's more, I believe they know it is bad for consumers, as I will attempt to show you in one of the next few messages. To find out who your legislators are and how to contact them, visit this link: http://www.legis.state.wi.us/wamltest/ -- Sincerely Yours, Jay Reifert, Broker/Owner*****************Excel-Exclusive Buyer Agency 100% Homebuyer Representation********5136 E. Hilltop Road 100% Of The Time****************************Madison, Wisconsin 53711 South Central Wisconsin's ONLY********(800)928-9379, Toll Free Full-Time Exclusive Buyer Agency Firm.***(608)273-8841, Office Visit http://www.true-agent.com ***********(608)273-8388, Fax Machine or mailto:true-agents@true-agent.com Check out our NEW website, at: http://www.Buy-Madison-Real-Estate.com