Real Estate

Bright MLS Cracks Down On Abuse Of Pocket Listing Rule

The nation’s second-largest multiple listing service is cracking down on agents and brokers who make a habit of violating its pocket listing policy.

As of Monday, Bright MLS, which has about 95,000 subscribers in the Mid-Atlantic region, is only allowing each brokerage one 24-hour grace period per year to fix a violation of its Clear Cooperation (Off MLS) Policy. The policy requires requires listing brokers to submit a listing to Bright within one business day of marketing a property to the public.

Bright’s enforcement change, effective May 10, means that any additional confirmed violations will result in an immediate fine. The fine is $5,000 for a subscriber’s first violation of the rule and $7,500 for a subscriber’s second violation. If the subscriber commits a third violation, their subscription to the MLS will be terminated. Subscribers may appeal fines.

The change is based on subscriber feedback, according to a notice to Bright’s subscribers.

Screenshot of notice on Bright MLS’s website

“We listened to our subscribers, who were concerned that the Off MLS policy was being abused by those who were willing to ‘fix’ a problem once they received our courtesy notice allowing them 24 hours to come into compliance,” Bright MLS spokesperson Christy Reap told Inman via email.

“[The change] will allow one 24-hour grace period per brokerage per year. For example, if a Broker received one courtesy notice this year about a listing that needs to be added to the MLS, the next violation will not be allowed an opportunity to ‘fix’ the issue and will instead result in our issuing a fine to the Agent right away.”

Asked how Bright defines “brokerage,” Reap said, “A Brokerage is defined by the offices under a particular broker of record. The Broker of record is the entity with ultimate responsibility for the listings within their office, so this update is giving that broker one grace period each year. We rely on the Brokers to remind their agents of the rules and importance of compliance.”

Bright was the first MLS to enact the pocket listing rule in October 2019 and the National Association of Realtors followed soon thereafter, mandating the Clear Cooperation Policy for all Realtor-affiliated MLSs. The rule was meant to effectively end the growing practice of publicizing listings for days or weeks without making them universally available to other agents, in part to address fair housing concerns.

“Cooperation among the Brokers and Agents who are Bright MLS subscribers is one of the pillars of our organization, and we believe a transparent marketplace is best for consumers,” Reap said.

The Clear Cooperation Policy has been controversial, in part because it exempts office exclusives, or listings marketed entirely within a brokerage without submitting them to an MLS, reportedly leading to an increased number of such listings. Some real estate brokers have threatened mutiny over the exemption, which they argue inadvertently benefits large, national brokerages at the expense of smaller, independent brokerages.

Rich Webb, an agent at Century 21 Veterans in Pennsylvania, expressed his displeasure about Bright’s enforcement change in a Facebook group titled “Bright MLS Nightmares and Support” with 1,500 members.

“I would love to see the subscriber feedback they are referring to,” he wrote. “I’m sure they didn’t get any feedback to turn up the fine process except from within Bright to increase revenue! So a brokerage with one agent is handled the same as a brokerage with 300 agents? That makes no sense! One 24 hour correctable notice per year per brokerage, what a joke!”

In response, Reap told Inman that Facebook group “has very little activity and few members.”

“While we take all subscriber input seriously and have personally reached out to those who had questions/concerns, there has also been extremely positive feedback from other subscribers, who support the update of the enforcement of the policy, which was made in response to subscriber requests,” she said.

Reap also noted that when Bright receives a Clear Cooperation complaint, its staff investigates it immediately and the “vast majority” are found to not be in violation. For instance, year to date so far in 2021, 70 percent of such complaints have been found not to be in violation and of the remaining complaints, 99 percent were corrected immediately by the agent and no fine was needed, according to Reap.

Art Carter

These numbers somewhat echo figures provided by California Regional MLS (CRMLS) CEO Art Carter at the Realtors Legislative Meetings’ MLS Forum last week in which he noted that CRMLS had gotten 870 Clear Cooperation complaints in the past year and only 26 had turned into citations. CRMLS has only seen a 0.4 percent increase in office exclusives, according to Carter.

Fines are less than half a percent of Bright’s gross revenue, according to Reap.

“Bright paused all fines from March to October during the COVID pandemic,” she said. “The dedication of resources to our accuracy and policy department and staff operates at a loss. We would vastly prefer to collect no fines, Bright issues very few clear cooperation fines in any given year, and fines are barely a blip on Bright’s financials.”

Bright’s first priority is education of its subscribers around policies, according to Reap.

“We devote significant resources to informing and working with our subscribers to seek their input, answer their questions, and maintain open lines of communication around our policies,” she said.

“The main goal of this education is to provide accurate, reliable information for the entire Bright community. Investments in our accuracy and policy function is an investment in the accuracy of our system.”

Email Andrea V. Brambila.

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