MAR Legal Hotline Notes - June 2018
Monday, June 4, 2018
Posted by: Karen DeDonato
June Notes from the MAR Legal Hotline
I’ve heard that Facebook is under a lot of scrutiny lately for enabling housing discrimination – can I still advertise my listings on Facebook
Yes, you can still advertise your real estate business and specific listings using Facebook’s advertising platform; however, you must remain cognizant of the Fair Housing Act, as well as the Massachusetts laws and Regulations that govern real estate advertisements. Facebook offers the opportunity to target ads to specific groups of people based upon criteria like age and gender. While this certainly seems like a tempting feature to focus the advertisement’s audience, by excluding individuals that do not fall within the selected categories, you may be in violation of the Fair Housing Act, as well as state anti-discrimination laws and the Realtor® Code of Ethics. Massachusetts prohibits discrimination based on the following: race, color, religious creed, national origin, ancestry, sex, age, handicap (disability), sexual harassment, sexual orientation, marital status, children, retaliation, veteran status, or public assistance. Keep in mind when advertising, on social media or otherwise, describe to property, not people and make sure all advertisements include the name of the broker!
My file cabinets are overflowing! For how long must my office retain documents?
There are several laws and regulations that require certain transaction documents to be retained for a specified amount of time. They are as follows:
State Regulation CMR 254 CMR 3.00 (10)(b) requires every broker to keep “a record of funds deposited in his/her escrow accounts, which records shall clearly indicate the date and from whom the broker received the money, date deposited along with the source of the money and check number, date of withdrawal with the name of the person receiving such withdrawal, and other pertinent information concerning the transaction and shall clearly show for whose account the money is deposited and to whom the money belongs. Every broker shall also keep a copy of each check deposited into and withdrawn from the escrow account for a period of three years from the date of issuance.”
State Regulation CMR 254 CMR 3.00 requires brokers to retain the Massachusetts Mandatory Licensee-Consumer Relationship Disclosure, as well as Consent to Dual Agency Disclosures and Designated Agency Disclosures for a period of 3 years from the date of the notice.
State Regulation 254 CMR 7.00 (2) requires the following items to be retained for a period of 3 years: the Tenant Fee Disclosure, from the date on which the notice was provided; “all rental listings and written documents that demonstrate the availability of an apartment at the time it is advertised for rental” from the date on which the apartment was rented; and “a copy of any check, money order and written cash receipt for any fees, deposits or payments made by a prospective tenant or actual tenant” from the date of issuance.
Federal Regulation 24 CFR § 35.175 requires brokers to retain the Lead Paint Form for 3 years. Additionally, HUD recommends that, “given the liability issues associated with lead-based paint,” the following forms should be kept indefinitely: Receipt of Lead Hazard Information Pamphlet; copies of the Lead Hazard Evaluation and Reduction Notices; Evaluation, Lead Hazard Reduction and Clearance Reports; and ongoing Maintenance Records.
Regardless of the specific retention requirements noted above, it is a good idea to keep all transaction documents for seven years. The statute of limitations for most contract actions is six years, so you want to make sure you retain documents long enough to be able to defend yourself, if necessary. Certain documents, such as corporate records, partnership agreements, audit reports, general ledgers, tax returns and deeds should be kept permanently. It is a good idea to work with attorney and/or accountant to develop and maintain a record retention policy. In most cases, it is acceptable to store these documents electronically, as long as you are safely and securely backing up all of your data.
I’ve heard about something called GDPR and that I should update my website; what is this and how does it impact me?
The GDPR, short for the General Data Protection Regulation, governs how websites and businesses treat data that belongs to residents of the European Union, regardless of citizenship. This regulation applies to businesses and organizations around the globe, not just members of the EU. The GDPR requires an affirmative “opt in” to allow companies to collect website user’s personal data, rather than the traditional opt out we have all become accustomed to. The goal of the GDPR is to give back control of personal date to individuals by granting the following rights:
The right to be informed that data is being collected and how it is being used
The right to object
The right to access that data
The right to change the data
The right to have the data erased.
While it may seem like these regulations wouldn’t apply to the typical real estate agent here in the United States, it is strongly advised to implement these updates as the potential fines for a breach of confidentiality are significant – up to $20 million Euros or 4% of a company’s annual global income, whichever is greater. The GDPR applies to the collection of the following information: name, phone number, address, e-mail address, IP address, cookie identifiers, location data, genetic information, mental/psychological information, economic information, cultural information, and any information pertaining to a person. If you have a website with an IDX, a newsletter sign up form, a listing request form, a “contact us” form, or any place where a user inputs their information on your website, you need to make sure you are GDPR-compliant.
These regulations under the GDPR became effective May 25, and while the GDPR may not apply to all real estate businesses, we recommend that you speak with your website vendor to discuss what data is collected and whether you should to update your website to become complaint these rules. It is also recommended that you speak with your insurance company to determine whether you would be covered in the event of a breach.
For more information, please see:
https://www.nar.realtor/sites/default/files/documents/GDPR-Article-FINAL.pdf and https://www.youtube.com/watch?v=NobDiwZQZJk