Department of Real Estate Benefit of the Doubt Program in a Nutshell

Good news for vigilant brokers throughout California!

This past summer the Department of Real Estate started a new “Benefit of the Doubt Program” which is now in practice on a trial basis.

In the past, the Department required brokers to report when they fired a salesperson if the discharge was because the salesperson had violated a Real Estate Law. Not surprisingly, most brokers ignored the requirement because they didn’t want their report to trigger a DRE investigation and/or audit.

But under the “Benefit of the Doubt Program” a reporting broker is shielded from an automatic investigation. Instead, the department promises to conduct an isolated investigation focused on the fired salesperson, not the broker or his/her agency.

You may be wondering: “What’s in it for the department?” The answer is simple – the program’s purpose is to encourage brokers to expose rogue agents before those bad actors have a chance to repeat their violations. The Department hopes that the number of reported violations will increase, which promotes the department’s overall goal of consumer protection. It also benefits supervising brokers by making following the rules less risky. This looks like a win/win situation because everybody benefits when bad or incompetent agents are put out of business.

But watch out! The program will only isolate the initial investigation to the salesperson. If the department determines the facts warrant a further, more expansive investigation, THE DEPARTMENT WILL INVESTIGATE THAT BROKER. But don’t fret. Formal disciplinary action against the reporting broker would only be considered when just cause exists, such as active broker participation in the unlawful acts or there is a demonstrated lack of proper oversight.

So that’s the “Benefit of the Doubt Program” in a nutshell. I for one hope the program is a success.

Check back at dredefenselawyer.com for future DRE updates!

Jillian Irvin, J.D.

For more details on the Benefit of the Doubt Program, see the Summer 2010 Real Estate Bulletin and the Broker Compliance Evaluation Manual, available online at www.dre.ca.gov and http://www.dre.ca.gov/pdf_docs/brkrcomp.pdf