As the real estate industry evolves, realtors are increasingly turning to third-party companies for lead generation services. These services, whether offering split commissions or fixed costs, promise to help realtors grow their client base. However, it’s critical to understand the legislation that governs how these companies operate and how realtors must conduct themselves when using their services. Ignoring these rules can lead to fines, reputational damage, and even legal consequences. Below, we’ll outline two key pieces of legislation: the National Do Not Call List (DNCL) and Canada’s Anti-Spam Legislation (CASL), and how they impact your business practices.

National Do Not Call List (DNCL)

The DNCL is designed to protect Canadians from unsolicited telemarketing calls. Realtors must comply with the DNCL rules when reaching out to leads provided by third-party companies. This includes:

1. Checking the DNCL Before Calling: Before making any cold calls, ensure the number is not on the DNCL. Third-party lead generation companies are not exempt from this requirement.

2. Obtaining Express Consent: If the lead has explicitly consented to receive calls, this overrides their presence on the DNCL. However, this consent must be documented and verifiable.

3. Record Keeping: Maintain records of consent and your DNCL checks. This is crucial for demonstrating compliance if audited.

4. Penalties for Non-Compliance: Fines for violating DNCL regulations can range up to $1,500 for individuals and $15,000 for corporations per infraction.

Canada’s Anti-Spam Legislation (CASL)

CASL governs the sending of commercial electronic messages (CEMs), such as emails and text messages. Realtors leveraging lead generation companies must adhere to the following:

1. Obtain Explicit or Implied Consent: CASL requires you to have consent before sending CEMs. Explicit consent involves the lead opting in, while implied consent can arise from an existing business relationship.

2. Provide Identification and Unsubscribe Mechanisms: Each message must clearly identify your business and include an easy-to-use unsubscribe link. This is mandatory for all CEMs.

3. Verify Consent from Lead Generation Companies: If a third-party company provides leads, ensure they have collected consent in compliance with CASL.

4. Penalties for Non-Compliance: Violating CASL can result in fines of up to $1 million for individuals and $10 million for businesses.

Best Practices When Hiring Lead Generation Companies

1. Vet the Company’s Practices: Before hiring a lead generation service, inquire about their methods for collecting and distributing leads. Ensure they comply with DNCL and CASL requirements.

2. Request Documentation of Consent: Ask for proof that the leads provided have given consent for contact. This protects you from legal liabilities.

3. Train Your Team: Educate your team on DNCL and CASL regulations. Ensure everyone understands the importance of compliance and the steps required.

4. Audit Regularly: Periodically review your practices and those of the lead generation company to ensure continued compliance.

Why Compliance Matters

Failing to comply with DNCL and CASL regulations can do more than incur financial penalties. It can harm your reputation, diminish trust with clients, and jeopardize your real estate license. As a brokerage, we are committed to operating with integrity and adhering to all legislative requirements. Ensuring compliance not only protects your business but also demonstrates professionalism to your clients and peers.

Conclusion

Leveraging lead generation services can be an effective way to grow your real estate business, but it must be done responsibly. By understanding and adhering to DNCL and CASL regulations, you can avoid legal pitfalls and build a sustainable, ethical practice. If you have questions about compliance or need guidance, please feel free to bring them up during our next company meeting.