FAIR Fee Apprasiers Involved in Regulation

[Stephen J. Vertin MAI]

This was taken off AI's breaking news

ASC Responds to Kentucky Board’s Questioning Its Advice

The Kentucky Real Estate Appraisers Board has expressed concern to the Appraisal Subcommittee and The Appraisal Foundation over advice requiring “Standard III” reviews on all complaints that involve alleged violations of the Uniform Standards of Professional Appraisal Practice. In a letter sent to both organizations early this year, the KREAB disagreed with this advice, stating that when a complaint is filed with a state regulatory board, the only issues considered are whether or not the appraisal in question meets the minimum USPAP requirements and applicable state licensure laws. Said the KREAB, “It is not the investigator’s charge to nit-pick the appraisal for every conceivable USPAP violation or offer his/her version of how the appraiser could have done better…The Board, not the investigator, makes the final determination of alleged USPAP violations.”

The ASC responded to the letter on February 13, 2002, that in these situations, state law (i.e., state statutes, regulations and court cases) controls the necessity of Standard III reviews. The ASC letter states, “We have consistently advised states to know and understand their statutes, regulations and case law to ensure that their investigatory procedures conform to state law. A state needs to ensure that it complies with its law to ensure the integrity of its enforcement process.”

 

[Tom Hildebrandt]

Steve et al

The KREAB has just once again side stepped the issue. The fact is that an investigator who is an appraiser who comments on the quality of another appraisers work product without preparing a review in compliance with Standard Three is acting unethically under the general conduct rules of USPAP.

In discussing this topic on its merits, it matters not one whit what the regulatory agencies other practices and policies are. It is just unethical. Our state regulatory agencies should not be enacting policy that is contrary to the ethics provision of our national standard.

The real reason these rogue boards wish to not have to comply with Standard Three is because it requires for the state to identify its case and the basis for the case well prior to the hearing. If the states investigators have to prepare a written doument explaining why they think some one is wrong, then the respondent can prepare a defense. For example, if I had known the states case was that they were going to alledge that the law is that an appraiser can not have the same highest and best use as the project, I could have brought in an expert to explain the correct interpretation of the law. I anticipated this argument, but not the absolutely unsupported BS from the new Deputy Director who refused to admit that there was any other position based on thirty years of experience (and no formal education except that provided in house by the NCDOT). In my case the board waited until the last minute to submit the written standard three review, too late for depositions and any new witnesses.

This is the real reason rogue boards do not want Standard Three reviews. They do not want to have their experts challenged on their prouncements. All these boards have two things in common, they want the investigators to be free to say anything without support, and the want the board members to hear the case and make all rulings. They want to make it easy for them to rule any way they wish.

Sam Blackburn may be a fine fellow, but anyone who suggests that an appraiser who comments on anothers work product without having to meet the minimal requirements of USPAP Standard Three is acting unethically.

I say, any board that can find factual data that an appraisal report is in error should be able to write a bullet proof appraisal review citing chapter and verse of an appraisal text as support. If they can only opine that something is wrong, they are arguing subjective judgements, and have no case.

Best regards

Tom Hildebrandt GAA

 

[David C. Johnson]

<span style='color:darkblue'>Tom,

I am sure you are absolutely correct. You discussed the pre-hearing disclosure issue and how some appraisal boards greatly stack the deck against the respondent. You mention this denial of due process as one of the actual reasons for these boards to resist STD-3. How true. How true.

You write:

"For example, if I had known the states case was that they
were going to allege that the law is that an appraiser cannot
have the same highest and best use as the project, I
could have brought in an expert to explain the correct
interpretation of the law."

As you are aware, the other fist of this knockout combination sucker punch is that while these unethical boards provide ZERO meaningful discovery to facilitate their ambush, the Respondent is forced to provide EXCEPTIONAL DISCOVERY right from the start with his or her WRITTEN RESPONSE to the board's/prosecutors' charges.

I wrote-up some of the dynamics and consequences of this gross inequity this morning, but have decided it is way too long and cumbersome to read, so I will spare the reader. I will say this: This "tribunal system" has been considered unconstitutional by many US legal scholars for many years -- even without the consideration that such obvious due process abuses might occur, or that grossly inappropriate board appointments might be made.

It is actually hard to believe any disciplinary case could EVER be lost under these conditions. I wonder how many cases the boards / prosecutors who repudiate USPAP's STD-3 have lost in the past few years -- we already know about the NCAB's impressive record.

Hopefully this will be discovered via the planned State Appraisal Board Questionnaire to be conducted by FAIR in the coming months. It will be interesting, but not surprising, to compare this record with that of the legitimate appraisal boards in the country.

Regards,

David C. Johnson, Raleigh</span>

 

[Dale Smalley]

Judy

I too am wondering what use this is if we have no complaint with the FL board. But i think the problem is not with the board itself but how the investigations and prosecuation of appraisers is handeled. You have to follow USPAP rules but nobody else does to make a case against you. I guess thats what the FAIR part is about. If you are accused of fraud the deck is stacked against you. You alone against the State and there is no way you can beat them if the rules only apply to one side. If everyone had to follow USPAP rules then we might get some real changes. I think that would be fair.