Based on submissions to our NVAR Legal Hotline, one of the most complained about, and violated, areas in real estate is licensee advertising.

The Virginia Real Estate Board defines "Advertising" as “all forms of representation, promotion and solicitation disseminated in any manner and by any means of communication to consumers for any purpose related to licensed real estate activity.”
In this article we will focus on two common violations: signs, and sales awards claims.

SAMPLE SIGN VIOLATION:
1. For Sale/Rent signs that do not include the Broker Firm’s name (or include the Broker Firm’s name in very small print).
If it is not obvious that the Broker Firm is the source of the advertising, and it could lead a consumer to think that the agent is the source of the advertisement, then the real estate communication (“sign”) may not be honest and truthful, may not present a true picture, and may be considered to be a misrepresentation. Such practice may run afoul of:
• VREB rules requiring that all advertisement be in the name of the Broker Firm which must be “clearly and legibly” displayed.

• Virginia Consumer Protection Act (VCPA), which considers the misrepresentation of the source of the services advertised as unlawful.

• Code of Ethics (CoE) Article 12, which requires that Realtors® be honest and truthful and present a true picture in their advertising.

Remember: The broker is responsible for his or her agents. If members of the public have an issue, they must be able to reach the broker, hence the requirement that the Broker Firm’s name on a sign be obvious.

BROKER NAME, PHONE MUST APPEAR ON 'FOR SALE' SIGNS
New pending legislation will require that the broker’s phone number be listed on a "for sale" sign. In any new "for sale" signs you make, be sure your brokerage’s name and phone number are displayed prominently!

VIRGINIA REAL ESTATE ADVERTISING: CURRENT RULES & REGS TO KNOW
1. VIRGINIA REAL ESTATE BOARD (VREB)
The VREB licenses salespersons, brokers and firms representing others in property transactions.
For real estate signs, VREB (18VAC135-20-190) requires that:
a) All advertising must be in the name of the firm.
b) The firm's licensed name must be clearly and legibly displayed on all advertising.

2. VIRGINIA CONSUMER PROTECTION ACT (VCPA)
The goal of the VCPA is to “promote fair and ethical standards of dealings between suppliers and the consuming public.”
VCPA (§ 59.1-200) considers the following practices fraudulent and unlawful:
a) Misrepresenting goods or services as those of another;
b) Misrepresenting the source, sponsorship, approval, or certification of services;
c) Misrepresenting the affiliation, connection, or association of the supplier, or of the services, with another.

3. REALTOR® CODE OF ETHICS (CoE)
Applicable to Realtors® only, these obligations may be higher than those mandated by law and applicable to all licensees.
CoE (Article 12) requires Realtors® to:
a) Be honest and truthful in their real estate communications.
b) Present a true picture in their advertising, marketing, and other representations. 
a. Use and display only professional designations, certifications, and other credentials to which they are legitimately entitled.
c) Ensure that their status as real estate professionals is readily apparent in their advertising, marketing, and other representations.
d) Disclose the name of the Realtor®'s firm in a reasonable and readily apparent manner, when advertising real estate services or listed property.

2. For Sale/Rent signs with team names such as John Smith Real Estate, Super Agents Realty Group, or Jane Smith Properties. The Broker Firm’s name and logo is included in the sign, usually less prominently than the team name/logo.
As mentioned above, the Broker Firm’s name needs to be displayed in a clear manner on a sign. If the team name or logo, and its placement on a sign, is such that a consumer could be confused and think that the team name is the Broker Firm, then this may run afoul of:

VREB rules requiring that all advertisement be in the name of the Broker Firm.

VCPA, which considers the misrepresentation of the source of the services advertised to be unlawful.

CoE’s Article 12, which requires that Realtors® be honest and truthful and present a true picture in their advertising. 

Comments from the Virginia Association of Realtors®
The Virginia Real Estate Board is very sensitive to team ads in which the team name is so prevalent, and the firm name so hidden, that the public could be confused as to whom they are dealing with.

Firms should also be cautious about team names.  We strongly encourage firms to limit team names to those that do not hold out the likelihood of confusion; teams should avoid realty, real estate, land, associates, partners, company, limited, consultants, sales, and properties. Use of the terms “team” or “group” is preferable. The key question is - does the ad leave the impression that the team is a brokerage firm acting independently?  If it does, VREB will likely punish the offenders.”
[Source: http://www.varealtor.com/hotlineadvertising]

Questions to ask:
Is it clear to consumers who the Broker Firm is? 
Could a consumer be confused and mistake the agent’s or team’s name to be the Broker/Broker Firm?

POTENTIAL AWARD VIOLATIONS:
1. NVAR sales awards claims that do not state a year:
Recipients of NVAR awards get the benefit of promoting their achievements, but that benefit comes with a responsibility to ensure accuracy. 

• NVAR awards may only be advertised by active NVAR members.  
• NVAR awards must be identified with the year in which the award was earned.  

Examples of misrepresentation and incorrect usage:

• Incorrect: “Top Producer, NVAR.” 
Correct: “Member, NVAR Top Producers Club, 2011.”
Correct: “Member, NVAR Top Producers Club, 2008, 2012.”

• Incorrect: “NVAR Multi-Million Dollar Club.”
Correct: “Member, NVAR Multi-Million Dollar Sales Club, 2011.”
Correct: “Member, NVAR Multi-Million Dollar Sales Club, 2012-2014”

• Incorrect: “NVAR REALTOR® of the Year”
  Correct: “2011 NVAR REALTOR® of the Year

Incorrect usage of the awards is a violation of NVAR Bylaws. In addition, using an award without stating the year it was awarded may mislead consumers and therefore run afoul of:

VCPA, which considers “misrepresenting the sponsorship, approval, or certification of services” unlawful.

CoE’s Article 12, which requires that Realtors® be honest and truthful and present a true picture in their advertising.

2. Real Trends/Wall Street Journal rankings.
One of the better known rankings, and one we have received several calls about, is the Real Trends ranking published as an advertising insert in the Wall Street Journal. As with all rankings, promoting it may get you in hot water. 

The Real Trends/Wall Street Journal claims submitted through our Legal Hotline are generally variations of: “Ranked in the top 100 by the Wall Street Journal.” This type of claim is problematic for two reasons:

a. Disclosing the ranking year: The rankings are prepared yearly, and,regardless of whether Real Trends has specific guidelines as to its usage, if the year and category of the ranking are not disclosed, it can mislead consumers to think that the ranking was awarded for a different year or category than it actually was, or that it is a permanent/lifetime ranking. (This problem is similar to incorrectly using NVAR sales awards as cited above.)

b. Disclosing the ranking preparer: The advertising insert itself includes a disclaimer at the top of every page that it is a “Special Advertising Section” and at the bottom of every page that “The Wall Street Journal editors and newsroom were not involved in the creation or production of this special advertising section or its story selection.” 

"The more details you omit, the more likely it is that a consumer can be confused."

Therefore, claiming that one was ranked by the Wall Street Journal is misleading, because it implies an affiliation or approval by a source which has specifically disclaimed such approval. 

For the above reasons these claims may run afoul of:

 VCPA, which considers “misrepresenting the sponsorship, or approval of services” and “affiliation, connection, or association of the supplier, or of the services, with another” as unlawful.

CoE’s Article 12, which requires that Realtors® be honest and truthful, present a true picture in their advertising, marketing, and other representations, and use and display only professional designations, certifications, and other credentials to which they are legitimately entitled.

The safer way to advertise a Real Trends ranking would be to disclose the category you were ranked in, the year of the ranking, and that the source is Real Trends. If you wish to use the Wall Street Journal name, it should be clear that it was an advertisement. 

For example: “Ranked as top 100 agent/individual sales volume, in 2012 by Real Trends, as advertised in the Wall Street Journal.” 

Remember: The more details you omit, the more likely it is that a consumer can be confused. The more details you disclose, the stronger your defense if a complaint is filed against you.