Jane Doe is completing her application for a real estate license in New Jersey. At the bottom of the form, she is asked whether she has received disciplinary action of any kind by another real estate licensing/regulatory agency. "None of their business," she thinks, and checks "no," then erases it and leaves it blank. No matter. New Jersey will soon know the truth, anyway. They participate in a global database system that stores disciplinary actions for the real estate industry. As part of Jane's application process, they'll run her name against that list and find out that her license was once suspended next door in New York.

Today regulatory agencies have to be concerned not only with what happens in their own jurisdiction, but in others across the continent and world as well. In 1992, the Association of Real Estate License Law Officials (ARELLO) implemented its Disciplinary Action Data Bank Program. It was established to assist real estate regulatory authorities in their processes for evaluating the honesty, trustworthiness, and competency of applicants to practice by providing them a mechanism to help determine whether an applicant has had disciplinary action imposed by a real estate regulatory authority in another jurisdiction.

To date, the ARELLO Disciplinary Action Data Bank houses disciplinary action information that has been submitted by 45 real estate regulatory agencies from the United States and Canada. ARELLO member jurisdictions report to the Data Bank: (1) any license revocation, suspension, fine, reprimand, censure, surrender or other action imposed against one of their licensees (individual, partnership, corporation, or other entity) for violating the laws and rules governing real estate brokers and salespersons, time-share salespersons, or other regulated real estate practitioners; (2) any denial of a real estate license due to matters relating to the applicant's character; and (3) any criminal conviction or civil injunction imposed upon a person or entity for acting as a real estate broker, salesperson, timeshare salesperson, or other regulated practitioner without the required license. Sanctions imposed by governmental regulatory bodies are generally matters of public record. However, members are encouraged to consult its legal counsel in regard to reporting some disciplinary actions.

Prior to licensure, many real estate licensing agencies now require each applicant's name be compared with those in the Data Bank to determine whether disciplinary action has been taken in another jurisdiction. "With our increasingly mobile society, it has become more important for us as regulators to utilize tools that take into account the mobility of regulated practitioners," said ARELLO Executive Vice President Craig Cheatham. "The Disciplinary Action Data Bank has been a significant resource for real estate regulators. High-ranking government officials and the public understand this simple, but powerful, concept that keeps our regulatory agencies from landing negative headlines for not adequately protecting the public. I would encourage other CLEAR members to contact ARELLO to begin a database system for their industries. The small cost associated with building, maintaining and checking such a data bank would be borne by the applicant. The program would add another tangible service your agency already provides."

It is important to note that if an applicant’s name is found in the Data Bank it does not automatically equate to denial of licensure. It merely triggers an investigative process in which the jurisdiction seeks to find out why the applicant lost or had their license sanctioned elsewhere. In some cases, the findings of the investigative process may result in denial of licensure while in others it may not. The local jurisdiction maintains complete authority in regard to the investigative processes triggered by a match found in the Disciplinary Action Data Bank.

In early 2002, ARELLO announced a major upgrade to the Disciplinary Action Data Bank System. ARELLO has made available a secured Internet based interface to the Data Bank so regulatory agencies can obtain instant access to information. The new online Data Bank application allows jurisdictions to upload the names of licensee applicants and instantly check the information against the Data Bank records for possible matches. The new Internet based system will also make it easier for regulatory staff to submit disciplinary actions on a more regular basis by simplifying the submission process.

If you would like more information about the ARELLO Disciplinary Action Data Bank or would be interested in implementing a similar program for your agency, please call 334-260-2902 and ask to speak with someone with the Disciplinary Action Data Bank Program.

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