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TITLE 22EXAMINING BOARDS
PART 8TEXAS APPRAISER LICENSING AND CERTIFICATION BOARD
CHAPTER 153RULES RELATING TO PROVISIONS OF THE TEXAS APPRAISER LICENSING AND CERTIFICATION ACT
RULE §153.24Complaint Processing

(a) Receipt of a Complaint Intake Form by the Board does not constitute the filing of a formal complaint by the Board against the individual named on the Complaint Intake Form. Upon receipt of a signed Complaint Intake Form, staff shall:

  (1) assign the complaint a case number in the complaint tracking system; and

  (2) send written acknowledgement of receipt to the Complainant.

(b) Priority of complaint investigations. The Board prioritizes and investigates complaints based on the risk of harm each complaint poses to the public. Complaints that pose a high risk of public harm include violations of the Act, Board rules, or USPAP that:

  (1) evidence serious deficiencies, including:

    (A) Fraud;

    (B) Identity theft;

    (C) Unlicensed activity;

    (D) Ethical violations;

    (E) Failure to properly supervise an appraiser trainee; or

    (F) Other conduct determined by the Board that poses a significant risk of public harm; and

  (2) were done:

    (A) with knowledge;

    (B) deliberately;

    (C) willfully; or

    (D) with gross negligence.

(c) If the staff determines at any time that the complaint is not within the Board's jurisdiction or that no violation exists, the complaint shall be dismissed with no further processing. The Board or the commissioner may delegate to staff the duty to dismiss complaints.

(d) A complaint alleging mortgage fraud or in which mortgage fraud is suspected:

  (1) may be investigated covertly; and

  (2) shall be referred to the appropriate prosecutorial authorities.

(e) Staff may request additional information from any person, if necessary, to determine how to proceed with the complaint.

(f) As part of a preliminary investigative review, a copy of the Complaint Intake Form and all supporting documentation shall be sent to the Respondent unless the complaint qualifies for covert investigation and the Standards and Enforcement Services Division deems covert investigation appropriate.

(g) The Board will:

  (1) protect the complainant's identity to the extent possible by excluding the complainant's identifying information from a complaint notice sent to a respondent.

  (2) periodically send written notice to the complainant and each respondent of the status of the complaint until final disposition. For purposes of this subsection, "periodically" means at least once every 90 days.

(h) The Respondent shall submit a response within 20 days of receiving a copy of the Complaint Intake Form. The 20-day period may be extended for good cause upon request in writing or by e-mail. The response shall include the following:

  (1) a copy of the appraisal report that is the subject of the complaint;

  (2) a copy of the Respondent's work file associated with the appraisal(s) listed in the complaint, with the following signed statement attached to the work file(s) : I SWEAR AND AFFIRM THAT EXCEPT AS SPECIFICALLY SET FORTH HEREIN, THE COPY OF EACH AND EVERY APPRAISAL WORK FILE ACCOMPANYING THIS RESPONSE IS A TRUE AND CORRECT COPY OF THE ACTUAL WORK FILE, AND NOTHING HAS BEEN ADDED TO OR REMOVED FROM THIS WORK FILE OR ALTERED AFTER PLACEMENT IN THE WORK FILE.(SIGNATURE OF RESPONDENT);

  (3) a narrative response to the complaint, addressing each and every item in the complaint;

  (4) a list of any and all persons known to the Respondent to have actual knowledge of any of the matters made the subject of the complaint and, if in the Respondent's possession, contact information;

  (5) any documentation that supports Respondent's position that was not in the work file, as long as it is conspicuously labeled as non-work file documentation and kept separate from the work file. The Respondent may also address other matters not raised in the complaint that the Respondent believes need explanation; and

  (6) a signed, dated and completed copy of any questionnaire sent by Board staff.

(i) Staff will evaluate the complaint within three months after receipt of the response from Respondent to determine whether sufficient evidence of a potential violation of the Act, Board rules, or the USPAP exists to pursue investigation and possible formal disciplinary action. If the staff determines that there is no jurisdiction, no violation exists, there is insufficient evidence to prove a violation, or the complaint warrants dismissal, including contingent dismissal, under subsection (m) of this section, the complaint shall be dismissed with no further processing.

(j) A formal complaint will be opened and investigated by a staff investigator or peer investigative committee, as appropriate, if:

  (1) the informal complaint is not dismissed under subsection (i) of this section; or

  (2) staff opens a formal complaint on its own motion.

(k) Written notice that a formal complaint has been opened will be sent to the Complainant and Respondent.

(l) The staff investigator or peer investigative committee assigned to investigate a formal complaint shall prepare a report detailing its findings on a form approved by the Board. Reports prepared by a peer investigative committee shall be reviewed by the Standards and Enforcement Services Division.

(m) In determining the proper disposition of a formal complaint pending as of or filed after the effective date of this subsection, and subject to the maximum penalties authorized under Texas Occupations Code §1103.552, staff, the administrative law judge in a contested case hearing, and the Board shall consider the following sanctions guidelines and list of non-exclusive factors as demonstrated by the evidence in the record of a contested case proceeding.

  (1) For the purposes of these sanctions guidelines:

    (A) A person will not be considered to have had a prior warning letter, contingent dismissal or discipline if that prior warning letter, contingent dismissal or discipline was issued by the Board more than seven years before the current alleged violation occurred;

    (B) Prior discipline is defined as any sanction (including administrative penalty) received under a Board final or agreed order;

    (C) A violation refers to a violation of any provision of the Act, Board rules or USPAP;

    (D) "Minor deficiencies" is defined as violations of the Act, Board rules or USPAP which do not impact the credibility of the appraisal assignment results, the assignment results themselves and do not impact the license holder's honesty, integrity, or trustworthiness to the Board, the license holder's clients, or intended users of the appraisal service provided;

    (E) "Serious deficiencies" is defined as violations of the Act, Board rules or USPAP that:

      (i) impact the credibility of the appraisal assignment results, the assignment results themselves or do impact the license holder's honesty, trustworthiness or integrity to the Board, the license holder's clients, or intended users of the appraisal service provided; or

      (ii) are deficiencies done with knowledge, deliberate or willful disregard, or gross negligence that would otherwise be classified as "minor deficiencies";

    (F) "Remedial measures" include, but are not limited to, training, mentorship, education, reexamination, or any combination thereof; and

    (G) The terms of a contingent dismissal agreement will be in writing and agreed to by all parties. If the Respondent completes all remedial measures required in the agreement within the prescribed period of time, the complaint will be dismissed with a non-disciplinary warning letter.

  (2) List of factors to consider in determining proper disposition of a formal complaint:

    (A) Whether the Respondent has previously received a warning letter or contingent dismissal and, if so, the similarity of facts or violations in that previous complaint to the facts or violations in the instant complaint matter;

    (B) Whether the Respondent has previously been disciplined;

    (C) If previously disciplined, the nature of the prior discipline, including:

      (i) Whether prior discipline concerned the same or similar violations or facts;

      (ii) The nature of the disciplinary sanctions previously imposed; and

      (iii) The length of time since the prior discipline;

    (D) The difficulty or complexity of the appraisal assignment(s) at issue;

    (E) Whether the violations found were of a negligent, grossly negligent or a knowing or intentional nature;

    (F) Whether the violations found involved a single appraisal/instance of conduct or multiple appraisals/instances of conduct;

    (G) To whom were the appraisal report(s) or the conduct directed, with greater weight placed upon appraisal report(s) or conduct directed at:

      (i) A financial institution or their agent, contemplating a lending decision based, in part, on the appraisal report(s) or conduct at issue;

      (ii) The Board;

      (iii) A matter which is actively being litigated in a state or federal court or before a regulatory body of a state or the federal government;

      (iv) Another government agency or government sponsored entity, including, but not limited to, the United States Department of Veteran's Administration, the United States Department of Housing and Urban Development, the State of Texas, Fannie Mae, and Freddie Mac; or

      (v) A consumer contemplating a real property transaction involving the consumer's principal residence;

    (H) Whether Respondent's violations caused any harm, including financial harm, and the extent or amount of such harm;

    (I) Whether Respondent acknowledged or admitted to violations and cooperated with the Board's investigation prior to any contested case hearing;

    (J) The level of experience Respondent had in the appraisal profession at the time of the violations, including:

      (i) The level of appraisal credential Respondent held;

      (ii) The length of time Respondent had been an appraiser;

      (iii) The nature and extent of any education Respondent had received related to the areas in which violations were found; and

      (iv) Any other real estate or appraisal related background or experience Respondent had;

    (K) Whether Respondent can improve appraisal skills and reports through the use of remedial measures;

  (3) The following sanctions guidelines shall be employed in conjunction with the factors listed in paragraph (2) of this subsection to assist in reaching the proper disposition of a formal complaint:

    (A) 1st Time Discipline Level 1--violations of the Act, Board rules, or USPAP which evidence minor deficiencies will result in one of the following outcomes:

      (i) Dismissal;

      (ii) Dismissal with non-disciplinary warning letter; or

      (iii) Contingent dismissal with remedial measures.

    (B) 1st Time Discipline Level 2--violations of the Act, Board rules, or USPAP which evidence serious deficiencies will result in one of the following outcomes:

      (i) Contingent dismissal with remedial measures; or

      (ii) A final order which imposes one or more of the following:

        (I) Remedial measures;

        (II) Required promulgation, adoption and implementation of written, preventative policies or procedures addressing specific areas of professional practice;

        (III) A probationary period with provisions for monitoring the Respondent's practice;

        (IV) Restrictions on the Respondent's ability to sponsor any appraiser trainees;

        (V) Restrictions on the scope of practice the Respondent is allowed to engage in for a specified time period or until specified conditions are satisfied; or

        (VI) Up to $250 in administrative penalties per act or omission which constitutes a violation(s) of the Act, Board rules, or USPAP, not to exceed $3,000 in the aggregate.

    (C) 1st Time Discipline Level 3--violations of the Act, Board rules, or USPAP which evidence serious deficiencies and were done with knowledge, deliberately, willfully, or with gross negligence will result in a final order which imposes one or more of the following:

      (i) A period of suspension;

      (ii) A revocation;

      (iii) Remedial measures;

      (iv) Required promulgation, adoption and implementation of written, preventative policies or procedures addressing specific areas of professional practice;

      (v) A probationary period with provisions for monitoring the Respondent's practice;

      (vi) Restrictions on the Respondent's ability to sponsor any appraiser trainees;

      (vii) Restrictions on the scope of practice the Respondent is allowed to engage in for a specified time period or until specified conditions are satisfied; or

Cont'd...

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