As the winner of the audience award at the Sundance Film Festival this year, the movie, "The Corporation" suggests a corporation can lose sight of such things as its responsibilities to the community. In fact, the film builds on the legal point that a corporation is a person in the eyes of the law, with limited liability, and in some ways corporations are less accountable than individuals.

The film assesses the behavior of corporations through a top FBI personality profiler only to find that many of the corporations featured in the film have the personality traits of a psychopath, including blatant disregard for the feelings of the others and willingness to lie and plunder to make shareholder profit goals.

Sickening scenes of child wage-earners in third-world countries to dying oil-slicked birds and fish disgorge any greater-good notion that consumer demand for cheaper products and shareholder demand for more profit are worth such costs. The point of the film is that people, animals and the earth are all stakeholders even if they aren't shareholders of corporations.

The board and management of the Multiple Listing Service of Northern Illinois, Inc. are learning a similar lesson - that the brokers and agents who supply the listings have a stake in what the MLSNI corporation does.

MLSNI CEO Jay Huffman was MLSNI's first employee, overseeing the start-up of one of the nation's largest MLS organizations as chartered by 10 association shareholders.

But over the years, something happened. Huffman and the board of directors discounted the stakeholders - the brokers and agents - in favor of the interests of the MLSNI corporation and himself.

Questions of conflicts of interest surround the hefty unsecured loans to REBIG, a company which is headed by Huffman's wife, Brenda Huffman. Mrs. Huffman was hired for $130,000 to develop a business plan for MLSNI to market MLS data to third parties. She was then awarded half the intellectual property rights which she turned into undiluted 12 percent share of REBIG, and she was awarded a salary of $315,000 annually to oversee REBIG by the REBIG shareholders. Mr. Huffman oversees MLSNI along with Multiple Solutions, the holding company which administers MLSNI loans to REBIG. He is also a board member of REBIG. REBIG has never returned a profit to MLSNI.

A forensic audit was called for by the shareholders, and results show that MLSNI needs an overhaul. Last week, PriceWaterhouseCoopers, the firm hired by the shareholders to conduct the forensic audit of MLSNI, and its CEO Jay Huffman, issued a Report of Investigation, after REBIG refused to allow auditors to see its books without a signed confidentiality agreement.

"Representatives indicated that even at this stage, it is safe to say that the audit report raises several issues that will require quick and decisive action," said a press release from the Chicago Association of Realtors (CAR).

The release was issued following a meeting of MLSNI shareholder association representatives who had met yesterday to discuss and decide what actions to ask the MLSNI Board of Directors to take, as the investigation is far from concluded.

“The leadership of the Chicagoland Realtor community is doing everything necessary to ensure that real estate professionals in the Chicagoland area will continue to receive the very best in real estate information and listing services,” says John Vranas, the voting shareholder representative for the Chicago Association of Realtors, MLSNI's largest shareholder. “Realtor leaders are moving to take all necessary and appropriate actions to protect this vital and valuable Realtor service.”

The shareholder associations adopted a resolution calling upon the MLSNI board of directors to consider the following actions, among others:

• (i) Hold a special meeting as soon as possible;
• (ii) Terminate Mowery & Schoenfeld, LLC as auditors for the company (MLSNI);
• (iii) Terminate Miller & Cooper as its public accounting firm (MLSNI);
• (iv) Terminate Robert T. Cichocki and Arnstein & Lehr as corporate counsel for the company;
• (v) Cause its wholly-owned subsidiary, Multiple Solutions, Inc. ("MSI") to make written demand on REBIG's Board of Governors to obtain for MLSNI, as a member of REBIG, monthly financial statements and other related information bearing on the business and financial condition of REBIG and its affiliates, investors, and officials;
• (vi) Cause MLSNI and MSI to discontinue all further funding of REBIG unless and until REBIG provides MSI with copies of the REBIG financial statements and such other business and financial information that MSI has requested from REBIG pursuant to the REBIG Operating Agreement or otherwise;
• (vii) Request that the board resolve all issues regarding Jay Huffman and the activities of REBIG and related parties.

“Chicagoland REALTORSŪ should be assured that their representatives are committed to seeing this matter to an appropriate conclusion that is in the best interests of REALTORŪ,” said John Vranas. “We will not allow any party to either withhold pertinent information or impede the continuing investigation of the critical questions raised by the forensic audit report of investigation. We call on all parties to be forthcoming immediately and that every effort be made to resolve these matters without further delay for the REALTORŪ community.”

Mowery & Schoenfeld, LLC were auditors for MLSNI, and Miller & Cooper were MLSNI's public accounting firm. Robert T. Cichocki and Arnstein & Lehr were the corporate counsel for the company.

Realty Times uncovered evidence in the form of company state registrations that counsel Cichocki represented MLSNI, Multiple Solutions, MLSNI's holding company, and REBIG, and that no one involved in the loan of money from MLSNI to REBIG, including Huffman, obtained a security agreement securing the loan.

"The forensic audit raised a number of issues," says Vranas, "as to conflicts of interest."

The request for a special meeting fell just short of asking for CEO Huffman's resignation, although it is evident reading between the lines that is what some shareholders are asking.

"We did not ask for Jay's resignation," Vranas explains, "The MLSNI board is the responsible entity to meet and take action. That is an action that the board needs to review and act upon accordingly."

When asked what the shareholder board means by "request that the board resolve all issues regarding Jay Huffman and the activities of REBIG and related parties," Vranas explains, "relative to what information he had regarding the investments, and there were a number of issues that were raised in the forensic audit that were identified with regard to his fiduciary duties and as CEO of MLSNI."

Vranas explains, "This really is an issue of confidence in the professionals that are leading the MLSNI organization, and we are looking to move this organization forward as opposed to having one person comment that we are having a hanging."

The board of directors meeting should take place on Monday, August 16, 2004.