by Summer Goralik | Jun 24, 2025 | Industry, News Feed
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“One lie … leads to another.” If you know the song, then you know Charles Wright (and the Watts 103rd Street Rhythm Band) weren’t singing about kickbacks, but they might as well have been.
I happened to be listening to that track when a new enforcement action landed in my lap. That was all it took to pull me off the creative writing streak I’d been riding and back onto the compliance path.
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So, with that, we might as well start from the beginning.
Several years ago, I stood in front of a packed room of escrow professionals, most of whom worked at “independent” shops, meaning escrow companies licensed by the California Department of Financial Protection and Innovation (DFPI).
Instead of the straightforward compliance talk I had planned, the session quickly turned into a venting forum. Many attendees took the mic to voice frustration and outrage, sharing stories about real estate brokers steering business to their own escrow companies — allegedly offering illegal perks to secure it. Many were angry. Some felt hopeless. And more than a few had simply lost faith in regulators.
After listening, I countered with one simple question: “How many of you have actually filed a complaint with the California Department of Real Estate?”
Silence.
I quickly filled the void with something along the lines of, “Don’t assume they know. Regulators are busy. You have to bring these issues to their attention. Make it a big deal. Let them get to the bottom of it.”
In other words, you can’t claim that nothing is being done if no one’s shining a light on the problem.
Fast forward to the present, and before diving into this fresh regulatory filing that’s bound to turn a few licensed heads, we need to zoom out and take a look at the broader escrow landscape.
How brokers fit into the escrow equation
Ever wondered how a real estate broker can handle escrow in a California transaction? The Escrow Law provides an exemption outlined in California Financial Code §17006 that allows them to step into both roles, acting as broker and escrow holder in the same deal.
There are two primary types of escrow operations in the state:
- Independent escrow companies licensed and regulated by the DFPI may offer escrow services to the general public.
- Exempt entities, such as real estate brokers, title companies, banks and attorneys, may handle escrows as part of their regular services, as long as certain conditions are met.
Under this framework, a real estate broker may operate an in-house escrow division regulated by the Department of Real Estate (DRE). These broker-controlled escrows are limited in scope. They may only handle transactions in which the broker is acting as a party and performing licensed real estate activities.
That said, some brokers cross the line by handling escrows where they aren’t a party or fail to perform a licensed act. That’s considered third-party escrow activity, and it can trigger action from the DRE — or even DFPI.
Alternatively, a brokerage may own an independent escrow company or hold ownership in a title company that operates a title-controlled escrow division, offering both title and escrow services.
Regardless of the structure, the frustration I heard in that room years ago was the same: Brokers were allegedly offering their agents financial incentives to route transactions through escrow companies they controlled or owned. And for the escrow professionals in attendance, this raised serious concerns about fairness, legality and market manipulation.
One kickback (leads to another)
In my years as a compliance consultant, I’ve encountered my fair share of unlawful kickback arrangements. Some brokers simply didn’t know the law. A few were unapologetic and willing to risk it. But the majority of brokers I’ve worked with want no part of this. They’re careful, cautious and committed to doing the right thing.
Still, for those who cross the line, the red flags are all too familiar. As a former DRE investigator and now a consultant, I’ve seen the same patterns repeat:
- Brokers offering to reduce office fees (transaction coordinator fees are a common enticement) if agents use the in-house escrow. And by “use,” I mean steer.
- Promising better commission splits for agents who “keep it in the family.”
- Subsidizing agent marketing costs (flyers, 3D tours, staging) to capture escrow volume.
These patterns aren’t hard to trace: Just follow the closing statements, the escrow holders, the agents and the money. It’s not subtle. In fact, the paper trail often paints a pretty blunt picture.
Let’s just say, I have investigative mileage in this area. I’m not bluffing.
Listen, when you get into this kind of unlawful activity — just like Charles Wright warned about lying — a kickback is rarely a one-off. It almost always leads to another. The broker offers an incentive, the agent steers the client to the broker-owned or controlled escrow, the reward gets paid, and the cycle feeds itself.
It starts as a pattern and quickly becomes a business strategy, one that writes its own story for regulators. All they have to do is read it.
Escrow compliance has been a constant throughout my career, from my early days as an escrow officer to my time as a DRE investigator and now as a consultant. I’ve contributed articles on the subject that still appear on the Department’s website, and I regularly work with brokers on understanding prohibited referral fee arrangements.
In other words, when it comes to unlawful kickbacks, I’ve been on both sides: enforcing the rules and helping brokers avoid pitfalls through education and guidance.
And honestly, I want real estate brokers to get this right. Although I believe most of them do, I also don’t want to stand in another room full of frustrated escrow professionals, disheartened by what they’re seeing out on the street. In many ways, this goes beyond compliance. It’s a matter of credibility.
The legal lines are clear
In California, the rules are not ambiguous. The DRE, which regulates real estate brokers and agents, enforces the following anti-kickback statute:
Business and Professions Code §10177.4 prohibits real estate licensees from receiving any fees, commissions or other consideration as compensation or inducement for referring customers to specific settlement service providers, including any escrow agent or controlled escrow company.
The DFPI, responsible for the regulation of escrow agents, enforces a parallel restriction:
California Financial Code §17420 makes it illegal for escrow agents to pay any commission, fee or other consideration in exchange for referrals.
And then there’s the elephant in the room: the federal government.
The Consumer Financial Protection Bureau (CFPB), whose waning authority and power have been a hot topic in the industry lately, regulates illegal referral activity under federal law:
RESPA (12 U.S.C. §2607) prohibits the payment or receipt of kickbacks for referrals of settlement services on a broader, national scale.
Even marketing perks and reimbursements may raise compliance concerns when tied to referral arrangements. While certain statutes — particularly RESPA — do allow for limited exceptions or safe harbors, those carve-outs are narrowly construed. Regulators often pay close attention to how these exceptions are applied in practice, especially when the line between legitimate collaboration and inducement becomes blurred.
Enter a newly filed case drawing attention.
A new DFPI case pulls back the curtain
I’ve always said that one of the most valuable and free forms of education for any practitioner is reading enforcement actions issued by regulatory agencies.
Earlier this month, the DFPI filed an Accusation to revoke the escrow license of a company it alleges offered unlawful consideration for referrals. According to the Accusation, the escrow company paid over $44,000 to cover photography and videography services used by real estate agents to market their listings. Roughly 82 percent of those listings ended up closing escrow with the same company.
In addition to the Accusation, DFPI issued an Order to Discontinue Violations and a supporting Statement of Facts, both of which provide further context for the agency’s concerns.
DFPI alleges this wasn’t a coincidence. It was a calculated effort to steer business by subsidizing agent marketing costs, which is a clear violation of the escrow law. The company is also accused of sponsoring broker preview events that led to escrow referrals, misrepresenting office locations without proper licensure and misleading DFPI about service contracts with affiliated marketing vendors.
These aren’t minor clerical oversights. On the compliance scale, they’re serious — and potentially costly. Notably, the Accusation outlines an alleged systematic effort to generate business through impermissible means.
While the allegations are significant, it’s important to note that the case remains pending, and the escrow company has the opportunity to file a notice of defense in accordance with due process.
Why this matters now
Public enforcement actions like this are not rampant in the escrow space. In fact, part of the reason I was put on the spot so many years ago is likely because there weren’t many public enforcement actions — or at least not enough of them — taking place against alleged bad actors.
DFPI’s action sends a clear message: Regulators are watching, and the tolerance for pay-to-play practices is fading. After all, that’s their job: to protect consumers, maintain a level playing field, and uphold both compliance and the integrity of settlement services.
Putting aside this particular enforcement action, which is far from final, I think it’s important for brokers to hear the following: When escrow is treated like a commodity to be traded for perks, trust suffers. I’ve seen it firsthand.
At their core, illegal referral fees can limit consumer choice, quietly drive up transaction costs and operate in ways that lack transparency. And let’s not forget, this kind of activity is not just a California issue. It can also create exposure under federal RESPA.
When the government bites
Most real estate professionals aim to do the right thing, and I can still say that — even after seeing some of the most egregious violations over the course of my career. But aiming isn’t enough if it’s paired with poor practices. Not knowing the law, or not meaning to break it, isn’t a defense either.
And regulators can’t take action without complaints, audits or evidence. Years ago, I told that room full of escrow professionals: “Change doesn’t happen in silence.” I still believe that.
This case is one to watch. It serves as a warning shot for those actually engaging in similar conduct, and a timely confirmation for others who consistently speak out against unlawful kickback arrangements. It’s worth noting that illegal referral fee activity almost always involves a network of players, including brokers, agents and affiliated businesses. And of course, participating in these schemes often comes with the assumption that no one is watching.
Well, I think it’s safe to say they’re watching. Where this goes, we’ll have to wait and see.
And while this action focuses on one company, similar investigations may follow, whether by the DRE for potential broker or agent misconduct or under RESPA at the federal level.
Here’s the deal: Whether or not the allegations in this DFPI case are ultimately proven, they underscore ongoing challenges in the industry that need cleaning up. With class-action litigation now etched into its résumé, real estate doesn’t have the luxury of looking the other way.
Unethical and unlawful practices, alleged or not, have to be put to rest. If we’re going to champion the value that licensees bring (and they absolutely do), we need to face the problems, no matter how uncomfortable and commit to fixing the cracks that weaken the foundation.
NOTE: The opinions, suggestions, and recommendations contained in this discussion are based on Summer Goralik’s experience working for the California Department of Real Estate and as a real estate compliance consultant. They should not be considered legal advice or relied upon as such. You should consult with your brokerage and/or appropriate legal counsel in your jurisdiction for further clarification.
by Summer Goralik | Jun 24, 2025 | Industry, News Feed
Real estate is changing fast, and so must you. Inman Connect San Diego is where you turn uncertainty into strategy — with real talk, real tools and the connections that matter. If you’re serious about staying ahead of the game, this is where you need to be. Register now!
I’m going to warn you right now. I’ve wanted to write this piece for a long time. I kept asking myself — how am I going to incorporate real estate compliance into one of my favorite ’90s flicks?
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And then it hit me: I’m leaving compliance at the door for this one.
Because there’s something bigger, and honestly, more important, for a lot of professionals out there. Especially for women.
There are a few things I remember vividly from my younger years, and believe it or not, Don’t Tell Mom the Babysitter’s Dead is one of them. Not just for the title (which is undeniably iconic), but because it struck a unique chord in a less modern time.
I loved this movie so much and didn’t realize the real reason why. But watching it again as an adult, especially over the past 15 years, it finally clicked. Yes, it’s funny. Yes, it’s chaotic. But more than anything, it showcases powerful women. And that hit differently, especially for a ’90s film.
This movie isn’t just a nostalgic Gen X favorite. It’s a story about a teenage girl who steps into a corporate world she was never supposed to enter — and absolutely owns it. And in the process, it offers some sharp commentary that still applies today, particularly in real estate.
As a sociology major in college, my thesis centered on a question I had always wondered about: Do women support each other, or are we conditioned to compete?
Back then, I felt the competition. It showed up in classrooms, social circles and even casual conversations. You could practically cut it with a knife.
But over time, that changed. I’ve been supported by incredible women throughout my life and career, and I genuinely love supporting other women, especially the smart, vocal and confident ones. It’s empowering not just to be a woman, but to be a fan of other women.
2 realities: 1 workplace
In the film, Sue Ellen Crandell (played by Christina Applegate) is underestimated and antagonized by Carolyn, an ambitious coworker who sees her as a threat. Carolyn isn’t exactly the villain, but she plays out a dynamic that’s all too familiar: Woman versus woman, especially when power feels scarce.
And yet, right alongside that tension, we meet Rose.
Rose is everything Carolyn isn’t. She’s warm. She’s encouraging. She’s competent. She gives Sue Ellen both freedom and structure. She sees potential before there’s even a résumé — albeit a completely made-up one in this case — to prove it. She’s the kind of leader many women remember having once, or quite frankly, wish they’d had.
The irony? In an industry like real estate, where the majority of agents are women, we still don’t see nearly enough Roses at the top.
The industry has a representation problem
Despite women making up nearly two-thirds of residential real estate professionals, men remain overrepresented in leadership roles. They dominate positions as broker-owners, team leads and executives at major firms. They’re more likely to be the ones closing high-dollar deals, chairing boards and shaping industry policy.
According to the California Association of Realtors’ (C.A.R.) 2017 Women’s Initiative report, women represent 57 percent of Realtors in California, yet hold only one-third of leadership roles in brokerages with over 100 agents — and just 26 percent of the top 500 real estate firms nationwide are led by women.
Nationwide, the 2024 National Association of Realtors Member Profile Highlights shows that 65 percent of Realtors are women, continuing a longstanding trend in which women make up the majority of the residential real estate workforce.
The paradox is hard to miss: Even in a female-majority industry, leadership and high-authority positions remain disproportionately male.
Wage disparities persist as well, particularly among top-tier producers and team leaders. According to The Zebra, in 2020, women brokers and sales agents made only 69 cents for every dollar their male counterparts earned, tightening to 92 cents at the management level. In commercial real estate, CREW Network found that while the base salary gap hovers around 10 percent, the bonus and commission gap blows out to a staggering 56 percent.
Although women are doing the bulk of the work, they don’t always set the rules. I’ve been surrounded by powerful women — broker-owners, firm partners, top producers. And yet, when I attend conferences or major industry panels, it’s sometimes hard not to notice how many are still led, moderated or headlined by men.
Not a criticism, just an observation that speaks volumes and reminds us that women must keep forging ahead and reaching higher.
Supporting roles — and real shifts
Back in the film, even Sue Ellen’s brother Kenny, the burnout-turned-budding chef, surprises us. When he’s overwhelmed by housework, cooking, prepping for the party and keeping the kids in line, Sue Ellen calls him out with a line that still hits: “It’s a rat race and it sucks, Kenny. So what do you want, a medal?”
I might not have known it at the time, but that moment flips the gender script. Kenny’s domestic labor becomes visible and exhausting. But instead of retreating, he memorably steps up. He doesn’t just watch his sister succeed; he becomes part of what makes her success possible.
Real estate needs more of that energy. More men who listen, support and make room at the table. Not just in theory, but in leadership roles, partnerships and backing deals.
The Rose effect: Support is a leadership skill
Don’t Tell Mom the Babysitter’s Dead is often remembered for its humor and chaos. But behind the corporate whirlwinds and the constant demands of family life lies a deeper truth: Women don’t need permission to lead — they need opportunity.
And when given both structure and autonomy, as Rose gave Sue Ellen, they don’t just show up. They thrive.
Personally, I owe my first consulting opportunity to a powerful woman who believed in me before I had any impressive title outside of government. She took a chance, gave me space and made it clear she had complete faith in my ability. That kind of trust? It was the best compliment and motivation I could’ve received, and it helped launch my career.
And speaking of compliments … I love giving them. Recently, I was at dinner with a male colleague when our waitress walked up, and besides being incredibly kind, she was absolutely stunning. So I told her. Without hesitation. Just a simple, genuine compliment. My colleague looked a little surprised.
Here’s the thing: When I see something I admire, I say it. I don’t care if we’re strangers, walking in a crosswalk or stuck in an elevator with 60 seconds to spare. If it’s genuine — whether it’s a strength, a kind gesture or something they’ve achieved — I’ll call it out. I don’t discriminate either. If someone’s doing something great, I’ll acknowledge it.
Sure, it might’ve been about her looks that night, but more often, it’s about someone’s smarts, character or the way they show up in the world. And as a woman who once wrote a thesis about whether women support or compete with each other, it hits differently when I can uplift the women around me. It feels personal. And powerful.
That wasn’t always me at 18. But now? I can’t stop thinking about how good it feels to say the thing out loud, to support someone in real time and genuinely mean it.
Don’t get me wrong. I know men who absolutely support women in the workplace. I work with them. I’m friends with them. They advocate, they amplify, they show up. And they’ll continue to show up.
But would I call it the status quo? Not yet.
We talk about innovation, disruption, evolution. But real transformation means looking at who gets lifted up, how we show up for them and whether we’re reaching beyond the usual circle.
And here’s the good news: There is momentum. While men still dominate many of the leadership stages and high-profile panels, more women are stepping into visibility — leading, mentoring and showing up for one another in ways that are shifting the narrative.
Tell Mom: There’s more to do
So let’s close this piece out. Two things are in order.
First, if you missed a film that knocked it out of the corporate park so many years ago, lifting up women from every inch of the screen, go back and watch this thing. Don’t Tell Mom the Babysitter’s Dead might surprise you. You won’t be disappointed.
Second, and more importantly, it’s time to look to real life. The real estate industry is in the midst of major change. And part of that progress must include a deliberate focus on recognizing, elevating and empowering women in leadership.
So let’s leave no compliment, no opportunity and no woman behind.
by Summer Goralik | Jun 11, 2025 | Industry, News Feed
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Sometimes I need a break from the heavy, the technical, the compliance-laden critique. This piece is exactly that: a written timeout. But just a heads-up: It might also double as a slightly imaginative reenactment of current industry dynamics.
Over the weekend, I stumbled across an old high school yearbook. I don’t know about you, but when that happens, you have to sit down and take a look. Within minutes, there I was, flipping through pages of big hair, loud clothing, awkward smiles and those cringeworthy superlatives like “Most Likely to Succeed” and “Best Looking.” (Also, do schools still single kids out like that?)
Instantly, I was transported. A mix of nostalgia, humor and, if I’m being honest, a little discomfort. High school was full of cliques, competition, drama, ambition and unspoken social norms. It was a place where image often mattered more than substance.
It was also a never-ending reshuffling of alliances, egos and influence. One day, you’re on top: admired, applauded, maybe even envied. The next, you’re sidelined, misunderstood or replaced. Friend groups fracture. Rumors fly. Power shifts. And amidst the chaos that high school could be, someone is always trying to make the system a little better, or at least a little fairer.
Somewhere between the photos and end-of-year messages, something hit me: the coexistence of the school handbook and the unwritten rules. Diverse social factions. Power struggles. Causes people champion or curse. And of course, the swings. The typical ups and downs that high school is known for.
Are the dynamics of residential real estate today … a little like high school?
Some of you are probably thinking, “Oh no, where is she going with this?” Others? You’ve already topped off your coffee and settled in.
Is this an off-base analogy or déjà vu? Either way, let’s have some fun. Hear me out:
Less dazed, more determined
What’s your favorite high school flick? I have many, but Dazed and Confused is at the top of my list. Mostly because I love the ’60s and ’70s: the music, the fashion. And let’s be honest, wearing bell-bottoms in the 2020s just doesn’t hit the same.
“If I ever start referring to these as the best years of my life, remind me to kill myself.” That painfully honest gem, delivered by Pink in Dazed and Confused, used to make me laugh. Now, it makes me think.
Sure, high school had its moments, but I’m far happier in this season of life. I’m more independent, less concerned with approval, and finally free to do the work I believe in.
Maybe the evolution of the real estate industry could reflect that too: less division, more alignment. Fewer power struggles, more shared purpose. A space where doing the right thing, especially for the people licensed professionals serve, matters more than protecting turf or preserving old hierarchies.
Before we dive into the yearbook of Real Estate High, let me just say: If the industry has felt a little like third period with a pop quiz lately, you’re not imagining things. It’s full of bold — and sometimes shocking — headlines, compelling sound bites and swirling rumors, shifting loyalties and silent (and sometimes not-so-quiet) hierarchies. I’d say the only thing missing is a hallway monitor handing out warning slips, but let’s be honest, that’s probably the DOJ.
Let’s head down the hall. Class is officially in session.
The roll call of real estate
Ready for attendance? Just a reminder, this is all in good fun. But if some of it hits close to home, well, that’s kind of the point. On a lighter note, if you’re going to read through this cast of characters, I highly recommend queuing up “Slow Ride” by Foghat. It sets the tone.
As you read, ask yourself: Which of these groups are helping the school thrive, and who’s skipping class? And remember, in this school, the real “assignments” are the deals, disclosures and decisions that shape the industry.
The student body (general agent population)
They’re the heartbeat of the school — showing up, grinding it out and navigating the social swirl of Real Estate High. Some are finding their voice. Others are just trying to make it to graduation without detention (or a DRE citation). They might not all agree on who runs the place, but without them, the halls would be empty.
The cool kids (luxury brokers)
They roll up in Range Rovers, dressed in quiet luxury and loud confidence. Everyone wants to sit with them, even if they pretend not to care. They don’t just sell homes. They sell a lifestyle, preferably with a view and an NDA.
The drama club (reality TV agents + social media stars)
Always “on.” Their open houses are productions, and their Instagram stories are more choreographed than a high school musical. Critics roll their eyes, but hey, they’ve got followers. Sometimes, that’s all it takes to win prom queen.
The geeks (compliance consultants + risk managers)
Uncool? Maybe. Indispensable? Absolutely. They do the homework no one else wants to touch, fix the group project at the last minute, and quietly save everyone’s GPA (and license).
The computer lab crew (proptech + AI innovators)
You’ll find them in the back of campus, building tools the rest of the school hasn’t caught up to yet. They speak in code, pitch big ideas and sometimes get accused of trying to replace teachers with apps. Visionaries to some, disrupters to others. They’re already operating in the future while the rest of us are still fumbling with hall passes.
The principal (state regulators + DRE)
They show up unannounced. They enforce the rules. And when someone breaks them? Expect a trip to the office, and probably a write-up. They’re not here to be liked. They’re here to make sure the place doesn’t burn down.
The teachers (managing brokers + ethics trainers)
Some are inspiring. Some are just counting the days to summer break. They manage behavior, grade performance and try to maintain order in a classroom full of conflicting agendas.
The teachers union (NAR + power brokers)
They’ve long shaped school policies and culture. They say they’re working for the common good — and sometimes, they are. But lately, more teachers are asking: Do they still speak for us?
The PTA (consumer watchdogs)
They don’t go to school here, but they’ve got a seat at the table and an eye on the budget. They show up to meetings, raise tough questions and push for transparency, especially when it comes to fees and access. Some roll their eyes. Others take notes. But one thing’s certain: They’re not staying silent.
The rule-breakers (unethical agents)
They’re vaping behind the gym — it was cigarettes in my day — skipping class and making side deals in the parking lot. Disregarding disclosure and steering buyers? Just part of the routine. They haven’t been caught … yet. But the detention slip is coming.
The overachievers (top producers who follow the rules)
They grind. They lead quietly. They do the work and turn in every form on time. Admired by teachers and peers, they’re the ones actually running the show, just not yelling about it.
The transfer students (new agents and startups)
They’re fresh, a little lost, and someone’s already tried to sell them a coaching program. But they’re curious, scrappy and not bound by legacy friend groups. That makes them unpredictable, but in the best way.
The student council (reformers + advocates)
They show up early. They raise their hands. They fight for transparency, access and equity — even when they get eye rolls in the hallway. But sometimes? They’re the reason the handbook gets rewritten.
The school newspaper (industry media)
They break news, stir the pot and sometimes publish op-eds in your locker. They’re not always unbiased, but people read every word.
The cafeteria (MLS + portals)
Finally, this is where it all goes down. Gossip. Deals. Power plays. You can see exactly who’s sitting where and what’s being served. Some cut the line, others sneak off-campus to eat. What’s visible may not be the whole story. And what gets missed can matter even more.
Fiction or flashback?
Take the cast of characters above and build whatever plot you like. The storyline is yours. But one common reflection when thinking about high school, at least for me, is how I’d do it differently. I’d certainly care less about who was watching and more about who I was becoming. I imagine many of us feel that way when we look back at younger versions of ourselves.
And while this piece is playful, even tongue-in-cheek, I think there are some key takeaways behind the metaphors. Real estate is in flux. Like any institution under pressure, it faces a choice: resist change or rise to meet it.
Right now, in this industry, we have a real-time opportunity to make better decisions. We can treat compliance not as a formality, but as a foundation for trust. It means showing up with intention, without letting the noise or the naysayers slow us down. We can walk forward, learning from the past, but also not looking back.
I should mention that when the coast begins to clear and the headlines quiet down, it becomes easier to see the workforce that has been there all along. It is resilient, ethical and motivated, doing the hard work for the right reasons. That deserves to be seen. And if not celebrated, then certainly acknowledged.
Another way to look at all of this, and as Matthew McConaughey’s character Wooderson memorably put it in Dazed and Confused, is: “You just gotta keep livin’, man. L-I-V-I-N.”
Perhaps that’s the reminder to pull from this crazy analogy: Keep moving, keep growing, and focus on what matters. Integrity. Service. Forward motion. Not image. Not popularity. And definitely not cafeteria politics.
Because high school ends. And thank goodness, right? We grow up. We evolve. We do the adult thing now. Less drama, more direction. Less posing, more purpose.
We should aim to be our authentic selves while continuing to grow, learn and adapt (so few of those walking around on a high school campus). Following the rules, even when no one is watching, has always been the real compliance challenge. And we shouldn’t fall in with the wrong crowd, even if they’re the ones holding the mic.
So sure, maybe this piece is just comic relief. I definitely laughed while writing it. Or maybe, just maybe, it’s a mirror. Either way, I think we can all agree the future is already here. This time, let’s get it right the first time. No regrets.
NOTE: The opinions, suggestions, and recommendations contained in this discussion are based on Summer Goralik’s experience working for the California Department of Real Estate and as a real estate compliance consultant. They should not be considered legal advice or relied upon as such. You should consult with your brokerage and/or appropriate legal counsel in your jurisdiction for further clarification.
Summer Goralik is a real estate compliance consultant and former CA DRE Investigator in Huntington Beach, California. Connect with her on LinkedIn.
by Summer Goralik | May 28, 2025 | Industry, News Feed
Bigger. Better. Bolder. Inman Connect is heading to San Diego. Join thousands of real estate pros, connect with the Inman Community, and gain insights from hundreds of leading minds shaping the industry. If you’re ready to grow your business and invest in yourself, this is where you need to be. Go BIG in San Diego!
I’d been waiting for it — refreshing the docket more often than I care to admit. When Professor Tanya Monestier’s appeal brief finally dropped, challenging the court’s approval of the National Association of Realtors’ $418 million settlement, I opened it immediately.
Despite being exhausted and juggling more deadlines than I’d like to admit, I started reading this monster of a brief after 10 p.m. I didn’t even need coffee to stay focused. That’s a rarity when diving into dense legal writing after hours. Once I got going, I couldn’t put it down.
This wasn’t legal commentary. It read like a novel, with the kind of twist that changes everything. One moment, I was in a world where the biggest real estate settlement in modern history had been finalized. The next, I was staring at a legal reality that might not exist at all.
Reading Monestier’s argument felt like watching The Truman Show’s final scene, when Truman sails to the edge of the horizon, crashes into a wall and realizes everything around him has been a carefully controlled illusion.
“We accept the reality of the world with which we’re presented,” says Christof, the show’s omnipotent director.
That’s exactly what the real estate industry did and even many of its critics. We accepted the reality of the NAR settlement, believing it was valid, final and fair. But Monestier handed us a legal hammer and said: Tap that wall. And when you do, you’ll see the foundation might not just be cracked. It might be imaginary.
Optimist or idiot?
OK, I’ll admit it. Last November, I thought the court might actually reject the settlement or at least send it back for serious modification.
Not just because of the Department of Justice’s last-minute Statement of Interest, which flagged clear antitrust concerns, but because of the objections. Monestier’s, in particular, cut to the heart of class action fairness: The lack of meaningful injunctive relief, the workarounds already underway by some Realtors, the disproportionate attorney fees and the insultingly low payouts to harmed sellers.
Her filing was detailed, methodical and meticulously cited, supported by evidence showing how the supposed reforms were being undermined even before they took effect. I truly thought her objection might make a difference.
I was one of the optimists, one of the people who thought: Maybe this is the moment the system will actually pause and take a harder look. Between the objections and the DOJ’s Statement of Interest, it felt like there were serious issues worth addressing.
Was this finally one of those rare instances where the outcome might reflect reality? A moment when the court would pause, take a harder look and demand real changes before ushering in a new era of rules.
But that hope gave way to acceptance. The settlement was approved. The story moved on. And I, like so many others, moved on with it.
That is, until I read Monestier’s appeal.
Suddenly, the question of justice wasn’t settled. It was unsettled all over again. Her account didn’t just challenge the terms of the deal. It challenged the process itself.
Roll credits? Not quite. Turns out we were only halfway through the movie
Notably, Monestier describes how objectors were sidelined — and how the court instructed plaintiffs to ghostwrite the final approval order before the fairness hearing even occurred. (I’m still shaking my head at this one.)
She also explains how objections were struck not on the merits, but because most objectors, including Monestier herself, couldn’t travel across the country just to be heard, despite a court notice that said showing up wasn’t required.
If her account is accurate, justice wasn’t served. It almost feels staged.
And perhaps I shouldn’t be surprised. After all, I’ve spent years watching real estate fraud cases unfold. I’ve seen bad actors slip through the cracks while their victims are left picking up the pieces. I’ve had my belief in the system tested and defeated before.
But this one exposed something deeper: how quickly procedure can overpower principle when no one slows down to ask the right questions.
The legal foundation nobody checked
Although I’m not an attorney, here’s the legal crux that floored me: Monestier argues the entire settlement rests on injunctive relief that the plaintiffs didn’t even have standing to seek.
In plain terms, these were past sellers. They’re not at risk of being harmed again. There’s no concrete allegation that they’ll sell another home anytime soon, let alone use a broker — or more specifically, a Realtor.
What Monestier’s brief makes crystal clear is this: You can’t settle a claim for future harm unless the plaintiffs are actually likely to face that harm. That’s basic constitutional law. Article III requires it.
So how did this get approved?
How did millions of dollars change hands, how did sweeping headlines declare victory, and how did no one stop to ask the one question that could unravel the whole thing?
Pennies for pain
And then there’s the money.
According to Monestier’s analysis, the average payout for harmed sellers is roughly $16 to $17. Not enough to buy a pizza, as she memorably puts it. Maybe enough for a mediocre sandwich.
Meanwhile, plaintiffs’ counsel received $333 million in fees. That’s not a typo.
I’d seen this disparity before. The math has been floating around for months. I remember nearly choking on my cannoli (for real) while crunching the numbers the first time. And Monestier’s brief once again puts the whole picture into perspective. The class members, the actual sellers whose transactions gave rise to this case, received barely a fraction of what they lost. In some instances, as little as a 10th of a penny on the dollar.
What’s more, the core conduct at the center of the litigation wasn’t even prohibited. Sellers can still pay buyer-broker compensation. In fact, brokers can still engage in broker-to-broker compensation. These practices weren’t banned. They were simply moved off the MLS and into the shadows, where — let’s be honest — enforcement is murky.
2 truths and a shaky foundation
I won’t pretend the settlement didn’t bring some progress. The decoupling of commissions? That’s a step toward a more consumer-centric model, and one I support. But I’d be lying if I said the outcome was perfect or that it fully addressed the underlying issues that can’t be denied.
Sellers are still footing the bill for buyer-broker compensation, just through different channels. Buyers, meanwhile, are being handed agreements to sign, sometimes within seconds of meeting their agents. The incentives may be rearranged, but the power dynamics haven’t exactly been reset. There’s good and bad here, just like in any solution that tries to resolve two different sides of a lawsuit or a deeply divided story.
And I’ll be honest: The idea of unwinding the settlement scares me a little. The industry is already struggling to adapt. Reopening everything could create more chaos, more uncertainty. And it’s not just this case. There are other related settlements that still haven’t received final court approval. If Monestier’s appeal gains traction, it will have ripple effects far beyond Sitzer | Burnett.
But listen, fear of disruption isn’t a valid reason to ignore an appeal that raises serious questions. It’s not just about fairness. It’s about legality itself. What Monestier’s appeal forces us to confront is a deeper, more uncomfortable truth: What if this wasn’t just an imperfect deal? What if it never had a solid legal foundation in the first place?
If her arguments are correct, the settlement doesn’t just deserve criticism. It may not survive scrutiny. That’s not a technicality. That’s a collapse.
We can’t afford to build trust on top of shortcuts. Justice isn’t a speed run. And landmark settlements — especially the kind that promise reform across an entire industry — can’t rely on shaky standing, procedural sleight of hand or ghostwritten rulings. Not if we expect them to hold real value.
So, where do we go from here?
Don’t look at me. I have no clue. Perhaps you’ll turn to Rob Hahn, who — right on schedule — just delivered a lengthy post breaking it all down. The title says it all: “It Ain’t Over Till It’s Over: Analysis of Monestier’s 8th Circuit Brief.” Among many, one particularly memorable takeaway is worth quoting: “Tanya Monestier, an individual law prof, not a giant law firm with hundreds of lawyers, might singlehandedly plunge the industry back into chaos with this appeal.”
That said, I do know this: If you felt something was off, if you sensed the objections raised by Monestier or the concerns flagged by the DOJ were treated more like noise than legal red flags, you’re not alone.
Oh, and if you haven’t read Monestier’s appeal yet? You should.
Just don’t be surprised when you hit the wall and realize the horizon was never real. Because once you see the construct for what it truly is, the only thing left to do is step through the door.
And, as Truman says with a smile before leaving the illusion behind: “In case I don’t see ya, good afternoon, good evening and good night.”
Editor’s note: This story was updated with a quote from Rob Hahn.
NOTE: The opinions, suggestions, and recommendations contained in this discussion are based on Summer Goralik’s experience working for the California Department of Real Estate and as a real estate compliance consultant. They should not be considered legal advice or relied upon as such. You should consult with your brokerage and/or appropriate legal counsel in your jurisdiction for further clarification.
This post was originally published on this site
by Summer Goralik | May 28, 2025 | Industry, News Feed
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I hadn’t planned to write another piece about the ongoing tug-of-war over transparency in real estate or where the industry is headed next. Truthfully, I thought I’d said enough.
But then Errol Samuelson took the stage.
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As Zillow’s Chief Industry Development Officer, Samuelson recently gave a timely presentation to a room full of industry leaders in Seattle, one that delivered a memorable shake-up I couldn’t ignore. He walked us through a series of “invent moments,” real-world examples of how disruption and innovation don’t just happen; they reshape the world because consumers demand better.
Samuelson’s message was nothing short of magical. That felt fitting, given where my mind went next. It reminded me how profoundly technology and innovation can elevate what we thought was already working.
Afterward, I found myself racking my brain for a similarly powerful illustration of change. Then, at 2 a.m., it hit me: Disneyland. Of all places, it’s one of the clearest, most relatable examples of how innovation can reshape expectations entirely. It also underscores something important: The real estate industry better not drop the ball.
From insomnia to insight — let’s go.
Disneyland’s joy and nightmare
The smell of churros and waffle cones. The hum of familiar music drifting through the air like sweet nostalgia for the adults roaming the park. The adrenaline of Space Mountain, the swashbuckling charm of Pirates of the Caribbean, the whimsical fan-favorite Peter Pan, and capping it all off, a Mickey-shaped ice cream at the end of a packed, unforgettable day. That’s the Disneyland magic — and what most people picture.
If you’d asked my husband a few years ago, though, he’d have given you a very different version: long lines, sweltering crowds, chaos. “Not the happiest place on Earth,” he once declared. “More like an absolute nightmare.”
Yet last year, our family went to Disneyland three times. Nothing stopped us — not holidays, not crowds, not even the long lines we used to dread.
So, what changed?
Tech as the game-changer
Enter the Disneyland app.
It might sound like a small update, but it completely transformed our experience. With live wait times, GPS-enabled maps, virtual queues, mobile food ordering and Lightning Lane access all at our fingertips, we didn’t just survive a day at Disneyland — we optimized it from beginning to end.
We strategized. We reserved. We customized. We enjoyed every moment.
The app didn’t just make Disneyland tolerable. It reimagined the day, almost effortlessly, into something magical, just as the Disney brand promises.
And of course, there’s a long legacy of innovation when it comes to Disneyland and its visionary creator, Walt Disney. If you’ve watched The Imagineering Story, then you know this article could easily go in many directions. The innovation behind Disneyland isn’t just about technology. It’s also about design, access, storytelling and constant reinvention.
But what struck me most was how this particular tech — the app — created equal access to visibility and efficiency. Everyone with it could participate fully, move smarter and make their day exceptional.
Increasingly, artificial intelligence is also part of this story. From personalized property recommendations to predictive pricing tools and smart fraud detection systems, AI is reshaping how information is processed and presented in real estate.
Just as Disney uses algorithms to predict crowd flow and improve park logistics, the real estate industry has an opportunity to harness AI in ways that serve consumers better. That means not obscuring or gatekeeping data, but making the experience clearer, faster and more efficient.
Now imagine this: What if Disney executives decided to go backward, unplugging the very innovations that completely revamped the guest experience?
No more app. No more digital wait times or online ride reservations. Just paper maps and physical FastPass kiosks. (Remember those? You had to crisscross the park just to snag one.)
Or worse, what if only some guests were allowed to use the app, while others were shut out of key features?
It sounds absolutely absurd, right? Because it is.
Technology and innovation are linear concepts. They move forward. They aim higher. They’re meant to level up the experience, not tear it down, divide it or drag us back to the past.
In real estate, they’re designed not just for convenience and ease of use, but to promote transparency, support fairness and meet — if not exceed — consumer demand. When properly applied, tech doesn’t just streamline the process; it opens doors, removes barriers and helps ensure more people can participate in the market on equal footing.
That’s exactly what the future of real estate ought to require.
Advocacy and compliance: The Seattle takeaway
At the event, I had the opportunity to sit on a legal and compliance panel, where I emphasized my hope that the voice of state regulators will play a stronger role in shaping this evolving real estate landscape, especially amid the ongoing debate over private listings and transparency.
Along the way, something hit me: Regulators and brokers often forget what they have in common. They’re both, at least in theory, in the consumer protection business (and yes, I can practically hear Rob Hahn shaking his head in disagreement at that statement).
This, truly, is what I believe should be the case. Brokers, like regulators, have a duty to protect consumers. They do it through unwavering fiduciary responsibility and ethical, sound business practices.
That’s the “consumer is your north star” argument everyone’s talking about — but here’s the thing: A north star doesn’t just shine. It points the way forward. If brokers are serious about that direction and what consumers have grown to expect, then going backward should be forever prohibited.
Another standout panel featured none other than James Dwiggins, CEO of NextHome, whom I half-jokingly call real estate’s new sweetheart. But the title fits: His mix of candor and credibility has made him one of the industry’s most trusted messengers.
Dwiggins’ advocacy against the use of private listings as a business strategy is both contagious and compelling, especially given that he comes from a lineage that once benefited from the very dynamics he’s now challenging.
I bring this up not just to highlight his position, but to spotlight leadership in action. It’s a reminder that industry change often begins with those willing to speak up — even when it challenges their own history. Understanding the problems isn’t enough. We need voices pushing for real solutions, and Dwiggins is one of them.
The keynote from Mark King, an award-winning CEO, former head of Taco Bell, Adidas North America and TaylorMade, was equally compelling. Now a global speaker on innovation and culture, he shared stories from his leadership journey and posed a powerful question: Why does it take a crisis to evoke change?
It shouldn’t.
I urged the brokers in that room to get ahead of the curve. Let’s not repeat the past. Our industry has been ransacked by issues that have chipped away at public trust and the perceived value of our profession.
Don’t wait for private litigation or a federal enforcement action. Be proactive. As I often tell my clients, clean your house now. That means reviewing your policies, tightening your oversight and resetting the standards from the top.
Return to fundamentals. Reinforce fiduciary duties, and make sure they trickle down through your entire salesforce.
Because if they don’t, it’s not just a compliance issue. It’s a credibility problem — and a failure to future-proof your business.
Portals and progress: Don’t shut the gates on transparency
Innovation and technology don’t just reshape industries. They reinvent them. That’s as true for real estate as it is for travel, retail or entertainment.
Just as Disneyland revolutionized its guest experience with an app that puts the park in your pocket, today’s real estate portals have transformed how consumers interact with the home search process. Platforms like Zillow, Redfin and Realtor.com haven’t just made listings easier to browse. They’ve brought the open market directly into our hands, layering the experience with tools that make home searching smarter, faster and more intuitive.
According to a January 2025 survey by Zillow, 81 percent of consumers said they want their home listed publicly and for free on widely accessible platforms like Zillow, Realtor.com or Redfin. That figure doesn’t just speak for itself — it says volumes about where consumer preferences are headed: toward visibility, convenience and empowered participation.
Let’s be clear. Everyone has skin in the Clear Cooperation Policy debate, and for that reason, all sides deserve scrutiny. But when major portals like Zillow and Redfin decide to stop displaying listings that are publicly marketed before being shared through the MLS, those are policy decisions that directly impact consumers. In my view, they lean in the direction of transparency.
Put simply, I’m for transparency through and through. But I also want it to mean something, not diluted by industry bluff or buried beneath systems that obscure the consumer’s view. Transparency should be treated as a substantive, real-world response to what buyers and sellers actually want.
Sure, it’s fair to note that these platforms also have a business interest in strong listing coverage. But it’s equally true that when portals lose market data due to strategic shifts in brokerage activity, the consumer experience suffers.
Transparency and a fair marketplace shouldn’t be casualties of internal industry disputes — they should be shared goals.
And let’s be clear: Transparency isn’t just about whether a listing appears. It’s also about what appears.
When brokerages, often through private listing networks, start removing key data points like days on market or price change history, they aren’t simplifying the interface — they’re stripping away context. Strip away context, and you lose consumer trust. Manipulate visibility, and you compromise the entire experience.
If I haven’t moved any new needles here, I’ll just say this: Debates and data aside, I’m a consumer. I want all the bells and whistles the future can offer. Whether it’s Amazon delivering my groceries, Disneyland curating a highly personalized park experience (which wasn’t always the case) or real estate portals providing a full view of the market in real time, that’s the experience I expect. And I know I’m not alone.
Downgrading the experience: A ride we shouldn’t take
Let’s go back to The Happiest Place on Earth for a moment.
If you’ve experienced Rise of the Resistance in Star Wars: Galaxy’s Edge, you know it’s more than a ride. It’s a masterpiece. By combining four cutting-edge technologies — trackless systems, motion simulators, drop towers and projection mapping — Disney creates an immersive journey that leaves guests in awe.
Now imagine Disney announcing they’re shutting it down. Or limiting it to a select few. Or replacing it with a one-dimensional, 1980s-era carousel.
Unthinkable, right? And yet, that’s the direction some brokerages are nudging real estate: dialing back innovation, restricting access and downgrading the consumer experience.
Some advocates, who are more blunt than I am, have called it what they believe it is: a prioritization of profit over people, in plain view.
Full circle: From paper maps to the future
“When you wish upon a star
Makes no difference who you are
Anything your heart desires will come to you.”
That timeless Disney lyric, written by Leigh Harline and Ned Washington for Pinocchio, has since become the company’s unofficial anthem. And it resonates far beyond theme parks. Isn’t that, at its core, what buyers want from real estate, too?
Not to be judged by who they are, who they know or who they work with. But to be given a fair shot. To access opportunity. To have their dreams of ownership, stability and a better life recognized and respected.
Sound familiar? That’s also the promise of fair housing. The power of visibility. And the reason transparency will always matter.
Technology, innovation and equal access have brought us to a better place, both in theme parks and in real estate. Consumers know it. They expect it. That’s exactly why we can’t go backward.
We can’t afford to fragment the housing market by retreating into outdated models or embracing full-blown off-MLS brokerage strategies. To put it another way: If someone opposes transparency, they may also be opposing convenience, efficiency and public trust.
So why are we asking buyers to navigate real estate in the dark? Why are we limiting their options, demanding loyalty to a single broker, and removing the very visibility they’ve come to rely on?
If Disney suddenly tore down the immersive, interactive system they’ve built — the real-time maps, mobile reservations and virtual wait lines — and told guests to rely on paper maps and guesswork, they wouldn’t just be inconveniencing people. They’d be gutting the experience.
My family wouldn’t go to Disneyland without the app. And buyers shouldn’t be expected to navigate one of the biggest decisions of their lives without full transparency either.
Technology, innovation and transparency didn’t just make Disneyland easier. They made it fairer, smarter, more enjoyable and more accessible. Real estate should be no different.
We’re not going back to paper maps.
Consumers have already moved forward. So let’s stop pretending that selective transparency, or anything less than smart and efficient innovation, has any place in the future of this industry.
NOTE: The opinions, suggestions, and recommendations contained in this discussion are based on Summer Goralik’s experience working for the California Department of Real Estate and as a real estate compliance consultant. They should not be considered legal advice or relied upon as such. You should consult with your brokerage and/or appropriate legal counsel in your jurisdiction for further clarification.
This post was originally published on this site
