A real estate brokerage firm's policy states that all advertising materials, including social media posts by salespersons, must be reviewed and approved by the supervising broker prior to publication. A salesperson posts an advertisement for an open house on their personal social media page without prior approval. What is the most likely consequence for the salesperson and the broker?
- AOnly the salesperson will face disciplinary action for violating brokerage policy, as the broker was unaware.
- BBoth the salesperson and the broker could face disciplinary action, as the broker has supervisory responsibility.
- COnly the broker will face disciplinary action for failing to adequately supervise, as the salesperson is an independent contractor.
- DNo disciplinary action will occur if the advertisement itself was compliant with fair housing laws.
Show answer & explanationAnswer & explanation
Correct answer: B. Both the salesperson and the broker could face disciplinary action, as the broker has supervisory responsibility.
In New York, brokers are directly responsible for the supervision of their salespersons, including reviewing advertising. An unapproved ad, even on a personal social media page, is a violation of brokerage policy and potentially state advertising regulations. Both the salesperson (for non-compliance) and the broker (for inadequate supervision) can be held liable and face disciplinary action by the Department of State.
Why the other options are wrong
- A. Brokers are responsible for salesperson actions, even if unaware, due to their supervisory role.
- C. Salespersons are not independent contractors in terms of regulatory compliance; the broker is still responsible for their actions. The salesperson would also face discipline.
- D. Compliance with fair housing is one aspect, but violating advertising review policy and general advertising regulations (e.g., proper disclosure of broker's name) is still a violation, regardless of fair housing compliance.
Broker Supervisory Liability
Real estate brokers in New York are legally responsible for the proper supervision of their salespersons, which includes reviewing all advertising. Failure to adequately supervise can lead to disciplinary action against both the salesperson and the broker for violations.
- Brokers must supervise all salesperson activities.
- Advertising (including social media) requires broker approval.
- Both salesperson and broker can be disciplined for violations.
- Supervision is a non-delegable duty.
Memory trick: Linked Licenses, Shared Liabilities.