AREC Holds First Meeting of 2024

AREC Holds First Meeting of 2024

The Alabama Real Estate Commission (“AREC”) held its first meeting of 2024 on January 18 in Montgomery. As will be the case moving forward, this meeting was not broadcast virtually. The meeting opened with remarks from Executive Director Vaughn Poe, including a financial report. AREC is currently receiving an average of 9.7 new applications per day, and there are a total of 41,216 active licenses in the state. Mr. Poe noted that brokerages that have not been audited in the past 3 years can expect to be audited soon. The Commission then heard 9 cases: 3 formal complaints, 3 licensing eligibility determinations, 2 hardship requests for a lapsed license, and 1 application for temporary salesperson licensure. Read on to learn more about the hearings and best practices. 


Proper Record Keeping is Critical

Two of the three formal complaints that the Commission heard this month were related to proper records retention, and both resulted from an AREC audit. In both cases, both the qualifying broker and the company were charged with multiple violations when an audit revealed that client files were missing key documents, including RECAD statements, purchase agreements, estimated closing statements, and limited consensual dual agency agreements. Following the audits, both qualifying brokers were able to produce some, but not all, of the missing documents. Ultimately, both companies’ licenses were revoked and both qualifying brokers’ licenses were suspended pending completion of continuing education, in addition to the brokers each being assessed a fine. License law is clear that not only do licensees have to complete certain documents, such as RECAD statements, in every transaction, they must also maintain those documents in their business files for 3 years following the transaction. If you have questions about what records license law requires you to maintain, you may contact AAR’s Legal Helpdesk (for AAR members) or AREC (for all licensees). 


Honesty is Always Best

The Commission also considered four cases of individuals with a criminal history who were seeking either license eligibility or temporary licensure. Each fully explained the circumstances behind their criminal conviction and the growth that they had undergone in the time since the conviction. Furthermore, each was forthcoming about their conviction throughout the application process leading up to the hearing. Ultimately, all four candidates’ requests were approved. 


Personally Address Any Issues

Finally, the Commission heard a case in which a licensee failed to notify the Commission of a pending criminal case against him. The licensee stated that he attempted to notify the Commission via letter, but that he gave the letter to another person to mail and that he wasn’t sure what happened to the letter after that. The Commission took issue with the fact that the licensee did not personally ensure that the Commission received his communication, instead leaving it in someone else’s hands. The licensee was found in violation and fined. 

The next AREC meeting will be held in Montgomery on February 22 at 9 am.