The Alabama Real Estate Commission (“AREC”) held its eighth meeting of 2026 on September 24th in Montgomery, Alabama. All commissioners were present except Commissioner Juanita Taggart Jones.

Executive Director Vaughn Poe provided an update on license renewals and new license applications. Approximately 77% of licensees renewed their licenses before the renewal deadline, leaving approximately 8,000 licenses eligible for late renewal. Poe also reported that AREC continues to receive approximately 200 to 300 new license applications each month. 

The meeting included six formal hearings, several of which involved recurring violations of Alabama’s transaction documentation requirements by out-of-state real estate companies. Another hearing highlighted the importance of qualifying broker supervision when their licensee engages in unauthorized real estate activities.  

One disciplinary matter involved a licensee who, along with their unlicensed spouse, established a separate limited liability company (LLC) to conduct property management activities outside of the brokerage with which they were affiliated. 

The brokerage became aware of these activities after its main office qualifying broker received a phone call from a consumer concerning the licensee’s property management activities. Upon learning of the situation, the qualifying broker instructed the licensee to stop conducting property management and explained that they would need to obtain the appropriate license and operate through a properly licensed company before resuming those activities. 

Although the licensee assured their main office and branch office qualifying brokers that they had stopped conducting property management and were working toward obtaining the necessary license, additional consumer complaints followed. Over approximately seven months, the brokerage continued receiving complaints concerning the licensee’s activities. 

The brokerage eventually initiated the process of terminating its relationship with the licensee. However, internal company procedures delayed termination, and the licensee’s license was not returned to AREC until several months after the qualifying brokers became aware of the licensee’s unlicensed real estate activities. 

The Commissioners found the licensee guilty of violating Ala. Code § 34-27-36(b)(14)-(16) by accepting compensation for licensed activities outside of their qualifying broker, advertising without prominently displaying their brokerage/qualifying broker’s name, and engaging in licensed activities in association with an unlicensed individual. The Commission fined the licensee for each violation and revoked their real estate license. Both the main office and branch office qualifying brokers were found guilty of failing to supervise the licensee (a violation of Ala. Code § 34-27-34(a)(2)) and fined.  The Commission also found the licensee’s spouse guilty of engaging in unlicensed activity (a violation of Ala. Code § 34-27-30(7)) and imposed a fine. 

The case highlights the responsibilities of qualifying brokers when supervising their licensees. When a broker learns that a licensee may be conducting unauthorized activities, instructing the licensee to stop may not be sufficient, particularly when subsequent complaints suggest that the conduct is continuing. Qualifying brokers should have procedures in place for promptly addressing complaints, documenting corrective action, and following up when there is reason to believe a licensee has disregarded company directives. 

Several disciplinary matters involved audits of out-of-state real estate companies conducting business in Alabama. Although the cases involved different companies and transactions, the audits revealed recurring deficiencies involving Alabama’s transaction documentation requirements. 

Among the violations discussed were missing Real Estate Brokerage Services Disclosures (RECAD) (Ala. Code § 34-27-82(c)), missing or improperly dated estimated closing statements (Rule 790-X-3-.04), and missing dual agency agreements (Ala. Code § 34-27-85(c)). In another case, a broker testified that they believed the required disclosures and estimated closing statements had been provided but acknowledged that they had failed to retain them. 

These cases remind licensees and qualifying brokers that Alabama’s documentation requirements apply to all companies conducting business in the state, regardless of where they are headquartered or how frequently they handle Alabama transactions. Importantly, providing the required documents is only part of compliance. Under Ala. Code § 34-27-36(b)(8)c., licensees must also ensure that the documents are retained in their qualifying broker’s files for at least three (3) years. These disciplinary matters offer an opportunity for qualifying brokers to review their company’s transaction procedures, particularly when overseeing licensees who conduct business in multiple states. AREC’s Office Audit Checklist identifies the documents and records auditors review and can serve as a useful resource when evaluating your company’s recordkeeping practices. The Alabama Association of REALTORS® also offers a Required Forms Checklist to assist in preparing and reviewing files. 

If you have questions about these topics and are an Alabama Association of REALTORS® member, please contact the Legal Line.