Dear Senators:

I am writing to comment on Connecticut's House Bill 6981, An Act Concerning Real Estate Brokerage Practices as amended by House Amendment Schedule "A," currently being considered in the Senate. Although the real estate industry promotes this Bill as increasing consumer choice, this Megabroker Bill actually will limit consumers' access to fair representation in real estate transactions. It primarily serves only the interests of the industry and places the consumer at the mercy of real estate licensees. No amount of amending of this entirely anti-consumer Bill, which legalizes an inherent conflict of interest, can produce any benefit to consumers.

The proposed legislation is contrary to the interests of the buying and selling public. Rather than repeal provisions of the existing statute which sanction dual agency, this legislation will result in more firmly entrenching anti-consumer, deceptive practices.

Bill 6981 is a blatant attempt by the real estate industry to dilute their obligations and loyalty to consumers while still charging the same commissions. Designated agency enables one real estate firm to simultaneously "represent" both sides of the real estate transaction, ensuring the largest possible commission for the firm (analogous to one law firm "representing" both the defendant and the plaintiff in the same lawsuit). This Bill would allow licensees to be the sole individuals "representing" the consumer (instead of the entire firm). The licensee would operate without supervision or guidance from the broker of record, the person who theoretically possesses the expertise, competence and experience for which the consumer is paying.

The real estate industry has been attempting to circumvent the responsibility to the public for fair, ethical and decent business practices since the Federal Trade Commission (FTC) issued its warning nearly 14 years ago. The FTC concluded that changes were necessary to avoid consumer harm. Instead of restructuring the industry to conform to the law, the industry response has been to systematically change the law, state-by-state, to conform to their harmful business.

Consumers have overwhelmingly and wisely stated in various surveys their desire to have their individual interests placed above all others when represented in a real estate transaction. This Bill places the industry's interests above all others, greatly harming consumers in the purchase of their homes, the largest financial investment for most Americans. I urge you to listen to your constituents. A similar bill was rejected in April, 1997 by the Massachusetts legislature.

Enclosed is a copy of my statement on the changes occurring in the real estate industry. It will give you some useful background on this issue. If you have any questions, please feel free to contact Leda Huta, a knowledgeable associate at 202-387-8030. Thank you for your consideration.

Sincerely,