Ethics

International Ethics Standards
How the IREM^® Ethics Process Works

IREM was formed in 1933 by representatives of real estate firms whose primary concern was the financial responsibility of those who were managing property for others. Each founding member firm was required to follow certain ethical standards of practice – specifically, each firm agreed to avoid commingling funds, to carry a fidelity bond for employees who handled money, and to refrain from reaping financial benefit from the use of a client's funds without full disclosure. These same IREM principles still stand today!

William Walters Jr., CPM^®, 1971 IREM President, captured the significance of ethics to IREM in his book, The Practice of Real Estate Management. Although the book was published by IREM in 1979, the words continue to resonate today:

“The final proof of a manager and the final demand on management is integrity, a moral soundness in business dealings that tests steadfastness to truth, purpose, responsibility and trust. Managers cannot compromise when it comes to demanding integrity from their superiors, their subordinates or themselves. No matter how knowledgeable or experienced the manager may be, if he lacks integrity he destroys himself, other people and in the long run his organization. He corrupts the purpose of the organization and destroys its spirit. Integrity cannot be taught or demanded, but is an absolute requisite for a professional property manager and one quality he must carry with him to the organization.”

All members of IREM are obliged to uphold the IREM Code of Professional Ethics, conducting their professional activities in accordance with the Code. In addition, AMO Firms must uphold the AMO Code of Professional Ethics.

The Codes protect the public, promotes competition, reflects contemporary business practices, and sends a powerful message to the marketplace that IREM Members act ethically. IREM is one of the very few organizations that actively enforce its Code – violations are processed within a defined structure, including an established peer review process that may result in disciplinary actions.

International Ethics Standards

IREM is a member of the International Ethics Standards Coalition (IESC), and all IREM Members pledge to acknowledge the ethical principles set forth in the International Ethics Standards established by IESC.

IESC’s goal is to create a universal set of ethical principles for real estate and related professions. The International Ethics Standards are high level ethical principles that embrace the broad scope of real estate, apply to all countries, and are consistent with member organizations’ individual codes to help real estate organizations promote ethical business practices.

How the IREM Ethics Process Works

While many associations have codes of ethics, a study by the American Society of Association Executives (ASAE) found that only one-third fully enforce their codes. IREM is committed to ethics as one of its core values and therefore strictly enforces its Codes, providing due process for all parties from beginning to end.

Violations of an IREM Code are processed within a defined structure by an established peer review process that may result in disciplinary actions. There are three boards that independently perform specific duties in the administration of IREM’s ethics program:

Ethics Inquiry Board

The Inquiry Panel performs initial review of all allegations of possible unethical or improper conduct that are filed with the Institute (in the form of a complaint), determines whether there is reasonable cause to believe such conduct may have occurred, and prepares and forwards complaints for hearing as may be appropriate. Because the Inquiry Panel’s initial determination is based solely on the information provided in the complaint, the thoroughness of the complaint documentation is critical. The Inquiry Panel may:

Forward the complaint to hearing
Open an investigation and request additional information from either the Complainant or the Respondent.
Dismiss the complaint and notify the Complainant accordingly.

Ethics Hearing and Discipline Panel

The Hearing Panel sets and holds hearings on matters forwarded by the Ethics Inquiry Panel. If the Hearing Panel finds a violation of the IREM and/or AMO Code, they determine the appropriate action to take and summarize and publish its decisions as it deems appropriate.

A member found in violation of an IREM Code(s) may receive one of the following disciplines from the Hearing Panel:

A letter of censure – which can either be published or not published; a letter of censure does not affect the Respondent's membership status.
Suspension of membership for a period of as little as one month and as much as three years – which is always published. The Respondent loses all benefits of membership during the suspension period but must stay current with dues and fees; the Respondent's status is automatically reactivated at the end of the suspension period provided all conditions are met.
Termination of membership status – which is always published. The Respondent may reapply for membership after five years, with the reapplication considered on its merits and under such policies as may then be in effect.

Ethics Appeal Panel

The Appeal Panel hears appeals to a decision by the Ethics Hearing and Discipline Panel upon request. The Appeal Panel may:

Adopt the decision of the Hearing Panel.
Modify the decision of the Hearing Panel.
Reject the decision of the Hearing Panel.
Refer the case back to the Hearing Panel for an appeal.

The Appeal Panel summarizes and publishes its decisions as it deems appropriate.

How to file an ethics complaint

IREM is a membership association and as such, we have jurisdiction only over our members’ adherence to our Codes of Professional Ethics. Issues involving miscommunications, business judgment, or human error are distinguished from definable unethical behavior and are generally not within the scope of the Codes. Anywhere from 10 to 20 complaints are filed each year. Typically, one-third to one-half are moved through the full ethics process – others are found to be contractual disputes or otherwise not issues that are covered by the Code of Professional Ethics.

A complaint alleging a violation of the IREM Code of Professional Ethics or the AMO Code of Professional Ethics may be filed by anyone – another IREM member, a resident, a tenant, an employee, an employer, a client, a vendor or supplier, or a member of the public.

Filing an ethics complaint

Here are the steps to file an ethics complaint:

Determine if the individual or firm is currently a member of IREM. Follow this link to our Membership Directory and search by name or company.
If a member:
- Individual Member (CPM^®, CPM Candidate, ARM^®, ACoM^®^®, Associate, Student, Academic): Review the IREM Code of Professional Ethics to determine if the individual’s behavior could be in violation of the Code.
- Firm Member (AMO): Review the AMO Code of Professional Ethics to determine if the firm’s actions could be in violation of the Code.
If you believe the behaviors/actions could be in violation of one of IREM’s Codes, you may submit an ethics complaint. An official Ethics Complaint Form must be submitted to IREM Ethics Department, ethics@irem.org, in order for an ethics complaint to be reviewed.

Click here to download the instructions and the official Ethics Complaint Form

When an ethics complaint is received

The individual filing the complaint is known as the "Complainant”, and the IREM Member against whom the complaint is filed is known as the "Respondent." It is up to the Complainant to show the burden of proof that an unethical violation has occurred.

Here is how a complaint is processed:

The Complainant receives confirmation via email upon IREM's receipt of the complaint. The Ethics Inquiry Panel typically meets once a month to review complaints.
The Ethics Inquiry Panel reviews the complaint, which must include the articles of the IREM Code(s) that has been allegedly violation and the supporting documentation (be sure to follow the Format for Filing an Ethics Complaint very carefully), to determine whether there is reasonable cause to believe that possible unethical or improper conduct may have occurred. Because the Inquiry Board's initial determination is based solely on the information provided in the complaint, the statement of facts and supporting documentation should be as thorough as possible.
If the Inquiry Panel determines that there is reasonable cause to believe that a possible unethical or improper conduct in violation of an IREM Code may have occurred, the complaint is forwarded to the Ethics Hearing and Discipline Panel for a hearing.
- Both the Complaintant and the Respondent will be notified if the complaint has been forwarded for a hearing; this notification will include all the details both parties need to prepare for the hearing.
If the Inquiry Panel determines that there is not reasonable cause to believe an unethical or improper conduct in violation of an IREM Code has occurred, the complaint is dismissed. The Complainant is notified of this decision.
In some cases, the Inquiry Panel may decide to open an investigation before making a final decision. In this case, either or both the Complainant and Respondent may be asked to provide additional information. In this case, both parties are notified of the pending decision on the complaint.

Questions?
Contact IREM Headquarters at ethics@irem.org.