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The Maryland Real Estate Commission Disciplinary Process

| April 20, 2021

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Having a Maryland real estate license is critical to your professional and financial well-being. Without it, you are unable to practice your trade of representing buyers and sellers of real estate. So your anxiety and fear are understandable should you find yourself facing the possibility of disciplinary action by the Maryland Real Estate Commission.

If this has happened to you, don’t panic. Having your real estate license revoked is an extreme punishment that is not often imposed. And that’s assuming you did anything wrong. Regardless of whether the complaint filed against you has any merit or not, it’s a good idea to first talk to a Maryland real estate license attorney, like Jay Stafford from the Law Firm of J.W. Stafford.

But before you make contact, it helps to have a rough idea of what the discipline process is like for Maryland real estate agents and brokers.

The Maryland Real Estate Commission

The Maryland Real Estate Commission (MREC) is part of the Maryland Department of Labor, Licensing and Regulation. The MREC’s mission is to regulate Maryland real estate brokers and agents. This includes:

  • Handling real estate license applications and renewals.
  • Enforcing applicable Maryland real estate statutes and regulations.
  • Processing and investigating complaints made against licensed Maryland realtors.

The MREC Disciplinary Process

Before the MREC can hand down any punishments against you, a few steps need to first take place. Usually, the first step begins when someone files a complaint.

Only individuals represented by a Maryland real estate agent or broker can file a complaint and the complaint must revolve around the leasing, sale or purchase of real property located in Maryland.

When filing a complaint, the individual will provide his or her contact information, the reason(s) for the complaint and documentation in support. This includes a contract of sale or lease agreement and any related paperwork, such as a listing agreement.

After the complaint is filed, the MREC will confirm it has jurisdiction to handle the matter. If so, you will get a copy of the complaint to reply to the allegations made against you. After the submission of your responses to the MREC, they will conduct a review which often involves a further investigation.

This investigation may include an MREC representative interviewing you and the person who filed a complaint. Once the investigation and review are complete, the MREC will determine if any violations occurred.

If the MREC concludes no violations occurred, they will close the complaint. If they decide violations did occur, then the matter will be subject to a hearing. Any complaint that results in the MREC bringing charges must be reviewed by the Maryland Attorney General’s office for legal sufficiency.

Assuming there is a legal basis for taking disciplinary action against you, the case is sent to the Office of Administrative Hearings and a hearing date is scheduled.

The hearing will often be in front of an administrative law judge and involve an assistant attorney general for Maryland presenting the MREC’s position while you have an opportunity to present a defense.

At the hearing, you may have an attorney represent you. Both sides will have the chance to submit evidence, including the calling of witnesses to testify at the hearing.

In limited cases, the MREC may summarily decide to revoke or suspend your license before a hearing occurs. In the rare case when this happens, you will still have the right to a hearing to challenge this decision.

Following the hearing, the administrative law judge will make a recommendation as to what sort of sanctions, if any, should be imposed against you. The MREC will then have the option to modify these recommended sanctions.

If you disagree with the administrative judge’s proposed findings of fact or proposed sanctions, you can file exceptions, which allows you to contest the proposed findings of fact proposed and proposed sanctions recommended against you. The filing of exceptions may result in another hearing and, subject to the MREC’s discretion, the chance to submit new evidence.

If either hearing results in a decision to implement sanctions against you, you will have the right to appeal the MREC’s decision to the appropriate Maryland Circuit Court. You must file this request for judicial review (appeal) within 30 days of the mailing of the final order from the MREC.

Potential Penalties Against Your Maryland Real Estate License

The MREC has some leeway on deciding what sort of penalties it will impose for violation of Maryland real estate laws. Generally speaking, the penalties will include:

  • Civil fine,
  • License reprimand
  • License suspension, or
  • License revocation.

The extent of the penalties can vary widely, depending on the severity of the violations. For example, minor violations may result in fines of less than $1,000. This might occur in a case where a seller’s agent fails to respond to a buyer’s request for additional information about an easement and future development plans of real estate next to a property of interest.

The most severe punishment will involve the revocation of a real estate license and a large fine in excess of $10,000. This might happen when a Maryland real estate broker collects rental income on behalf of his client, but fails to disburse the money to the client. In other words, the real estate professional steals the client’s money.

As you can see, the MREC discipline process is a serious situation that has the potential to result in a substantial negative impact on your livelihood and profession.

Thinking About Contacting a Maryland Real Estate License Attorney?

If you’ve received notice from the MREC about a client filing a complaint, you have every right to be concerned. But this doesn’t mean your fate is sealed. However, you will want to obtain the assistance of an experienced Maryland real estate license attorney. The Law Firm of J.W. Stafford can explain in further detail what you can expect from the disciplinary process, protect your due process rights and advise you on your best course of action to protect your livelihood.