1. Advertising Rules For Business Brokers
GABB Fall Conference 2018
presented by
Monica Gilroy
Part of the: Learn from the Litigator Series™
© Monica Gilroy, 2018

2. Agenda Where Do Advertising Laws Come from?
Broker Responsibility for Advertising
Blind Ads
Disclosing Financing Terms in Advertising
Gifts/Rebates/Inducements
Internet Advertising
Realtor Transitions to Another Brokerage

3. WHERE DO THE LAWS COME FROM?

4. GABB CODE OF ETHICS www.gilroyfirm.com
Article Two:  The Business Broker shall make reasonable efforts to protect the public and all parties to a transaction against fraud, misrepresentation, or unethical practices with respect to the subject business transaction.
Article Fourteen:  The Business Broker should not submit or advertise businesses without written authority; in any offerings the price quoted should be agreed upon with the Seller. The Business Broker should always have a written Brokerage Engagement, providing authorization to sell or purchase, as appropriate, from the prospective seller or purchaser. Said agreement should include all the material terms of the sale or purchase, including price, terms of agreement, and compensation to be paid to the Business Broker.
Article Twenty:  The Business Broker shall not deny equal professional services to, nor be a party to any plan or agreement to discriminate against, any person for reasons of race, creed, sex, religion, or country of national origin.

5. The Fair Housing Act

6. Fair Housing Act Celebrating 50 years this year…….
The Fair Housing Act makes it unlawful to discriminate….
because of race, color, religion, sex, national origin, disability, and familial status.
NAR- adds Sexual Orientation
Gender Identity

7. Fair Housing Act
•“To refuse to sell or rent after the making of a bona fide offer, or to refuse to negotiate for the sale or rental of, or otherwise make unavailable or deny, a dwelling”
•“To discriminate against any person in the terms, conditions, or privileges of sale or rental of a dwelling, or in the provision of services or facilities in connection therewith”
•“To represent to any person … that any dwelling is not available for inspection, sale, or rental when such dwelling is in fact so available”
42 U.S.C. §§

8. Fair Housing Act
All advertising media, advertising agencies and all other persons who use advertising to make, print, or publish, or cause to be made, printed, or published, advertisements with respect to the sale, rental, or financing of dwellings

9. Fair Housing Act Which words are okay to use in advertising?
Adults Only Empty Nesters Bachelor Pad
No one under 18 allowed Gated Community Fixer Upper
Near a Church Se Habla Espanol Private Prestigious
No pets No military Credit Check Required

10. Truth In Advertising Law

11. Truth In Advertising Law
Federal law says that ad must be truthful, not misleading, and, when appropriate, backed by scientific evidence.
The Federal Trade Commission enforces these truth-in-advertising laws
Applies to all Media regardless of form
The FTC looks especially closely at advertising claims that can affect consumers’ health or their pocketbooks 

12. Fair Business Practice Act

13. Fair Business Practices Act
O.C.G.A. Sections et seq.
Prohibits unfair and deceptive acts or practices in the marketplace. 
This law applies to consumer transactions involving the sale, lease or rental of goods, services or property mainly for personal, family or household purposes. 

14. Fair Business Practices Act
Claiming falsely that goods or services are of a particular quality or grade, or that products are a certain style or model
Making false or misleading statements about another business or its products or services.
Advertising goods or services with the intent not to sell them as advertised (example: using "bait-and-switch" tactics).
Advertising goods or services without having enough merchandise on hand to meet expected demand, unless the advertisement states "quantities limited."
Making false or misleading statements about sale prices (example: advertising "On sale today only," when the item has been offered at that price for the past month).

15. Broker Responsibility for Advertising

16. Broker Responsibility for Advertising
Georgia Real Estate Commission writes and enforces the Advertising Rules for agents and brokers.
The real estate brokerage firm always bears the responsibility for an advertisement's compliance with the license law.

17. Broker Responsibility for Advertising
If the Licensee places the violative ad, Broker/Firm and Licensee responsible
If the owner of a property pays for a violative ad, Listing firm may be on the hook if it did not act to prevent or halt the violative ad quickly
How to prevent problems? Have someone designated to review all advertisements before they appear in any media.

18. Broker Responsibility for Advertising
Bottom Line: a broker is responsible for
* the acts of his or her sales associates.
* establishing, implementing, and continuing procedures for reviewing all advertising
* being in compliance with the license law.
PRACTICE TIP:
Have a company policy for advertising to create consistency

19. Broker Responsibility for Advertising
Minimum advertisements must include:
Firm's name as registered with the Commission;
Phone number where a caller can reach the firm's management
Must be in compliance with fair housing laws and Georgia's Fair Business Practices Act;
Must not misrepresent any material facts about the property
not misrepresent any terms, values, policies, or services of the firm's business;
Be consistent with the trade name and franchise name requirements in Rule if firm operates under a franchise name

20. Broker Responsibility for Advertising
But what about puffing, braggadocios, exaggeration?
Its not all bad (and frankly expected)
BUT, do not misrepresent material facts, be fraudulent or violate federal laws

21. Blind Ads

22. Blind Ads
A "blind ad" is : an ad which does not make clear that a real estate firm is acting for the owner
If you suspect that an ad is a "blind ad,” consider contacting the firm running it
Contact GREC is ad continues

23. Disclosing Financing Terms in Advertising

24. Disclosing Financing Terms in Advertising
Not properly disclosing Financing Terms in Advertising may violate Dodd Frank, FTC-Not a GREC issue
Watch partial disclosures
In fact, may just want to avoid the same given currently regulatory landscape
It is okay to include general statements about financing such as "low down payment" or "loan assumption possible."

25. Gifts Rebates Inducements

26. Gifts/Rebates/Inducements
Number One advertising Complaint to the GREC
Be careful about advertising for things of value to unlicensed persons for providing leads
Can only pay referral fee to unlicensed people if it is less than 5 per year, per person

27. Internet Advertising

28. Internet Advertising
All of the advertising laws and rules of the license law
that apply to other advertising media
apply to the Internet.

29. Internet Advertising www.gilroyfirm.com
Advertise in name of Firm holding Licensee’s license
No abbreviations of Firm name
Cannot be misleading or inaccurate-no misrepresentations of property, terms, values, services, or policies
The advertisement must not be directed at, or refer to, persons of a particular race, color, religion, sex, handicap, familial status, or national origin
Don’t advertise for any other state unless you are licensed in that state

30. Internet Advertising
The Internet provides almost unlimited opportunities for licensees to describe their services.
However, that unlimited opportunity also provides unlimited opportunity for error.
CAREFULLY review Internet advertising

31. Realtor Transitions to Another Brokerage

32. Realtor Transition To Another Brokerage
Everything must be in writing
If Broker leaves for new job, they must notify the commission within 30 days and provide new address
If an Agent leaves, they must leave EVERYTHING-leads, names of clients, plats, documents, deeds, pens, paper, marketing materials, EVERYTHING
Social Media Sites need to be updated with the changes in real time.

33. Monica.Gilroy@gilroyfirm.com 678.280.1922
Questions?
Presentation Sources:
Georgia Real Estate Commission

34. Legal Disclaimer
Viewing of this presentation does not form a professional relationship or constitute receiving professional advice. Please contact our office to retain one of our attorneys to assist you.

35. Monica Gilroy or Anne Kelly at The Gilroy Firm for written permission.
Thank you for your interest in this presentation. We hope you find it educational.
For reproduction or presentation of the included content please contact:
Monica Gilroy or Anne Kelly at The Gilroy Firm for written permission.
Thank you,
Monica Gilroy
FOUNDER, FIRM MANAGER