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Facing AMC License Denial, Coester Sues Virginia Board

 

Facing AMC License Denial, Coester Sues Virginia Board
by Isaac Peck, Editor, WorkingRE
Excerpt:
Facing denial of its license to operate an appraisal management company (AMC) in the state of Virginia, the AMC Coester VMS has filed a lawsuit against the Virginia Real Estate Appraiser Board alleging that the Board is engaged in “a conspiracy to restrain and monopolize trade” and is operating in violation of federal antitrust laws.
The suit follows Virginia’s recently passed AMC licensing laws, which set an August 18 deadline for applicants to obtain AMC licensure or cease operations in the state. The Board has issued dozens of AMC licenses but selected Coester for closer examination. On July 15, Coester attended an informal fact-finding conference and addressed several of the Board’s concerns, including Coester’s history of consent orders and settlement agreements in five other states, for alleged violations of state laws: Maryland, North Carolina, Tennessee, Louisiana, and Minnesota. The allegations against Coester in these states include: unlicensed AMC activity, false advertising, failure to pay appraisers on time, failure to pay customary and reasonable fees, failure to respond to requests within the time period specified, failure to submit biannual certification, as well as USPAP violations committed by Brian Coester himself.
Read lots more, and get links to the docouments at:
For lots more info on Coester, just google Coester AMC or brian coester appraiser
My comment: Looks like various state appraisal boards are looking closer at AMCs. Coester recently got into a tiff with the Louisiana State Board, which was resolved. I am so glad California has never had an appraisal board!! (Gov.  Schwartzenegger wanted to cut costs back then.) Too many possible conflicts of interest… The issues seems to be mostly about fees. I am also not comfortable about appraisal state boards regulating appraisal fees. They should focus on what is important – USPAP.

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4 Comments
  1. Appraiser Steve, I too am a free enterprise advocate, even though I am a Republican Union Organizer (took me awhile to get used to saying the “U’ word). Your fee views are right on the money.

    I naively waited for “the system” to clean itself up. Gave it time to shake out the kinks though I knew in my heart from the first day of HVCC, real independence in appraisal had died. Then I joined a state coalition. Hard working, and honorable, but just too small in too big a state to get the job done. Especially when the AMC & MBA special interest lobbies immediately undo or gut any potentially good legislation.

    While testifying on behalf of a half billion dollar railroad project before two city councils (L.A. & Long Beach), I found myself testifying WITH numerous labor groups FOR a huge BIG BUSINESS project. I realized all of THEIR tactics had been honest, respectable and indeed commendably well thought out. I also realized the real lobbying power right then and there, & sought out a union. The first one (SEIU) was 100% unacceptable. They ONLY wanted government employees so they could hustle and collect dues; and their leadership had a bad reputation. I found the American Guild of Appraisers through another blog and became a member. Later an advocate and active defender of appraisers before their state boards and anyone else attacking them unfairly. I say all this so you understand my perspective in offering the following for MINIMUM “reasonable” fees (customary has become meaningless).

    Adopt either the VA scale OR the federal GS scale for appraiser pay in a forty hour work week equivalent for the different experience levels. OPM already DID the studies of what is “reasonable.” My calculations in most high cost states is from $500 to $650 for a conforming, non complex sfr. The beauty of the GS Scale is that there are regional COLA multipliers.

    lastly it is time to STOP DOING NOTHING. I spoke with an attorney VERY familiar with the issue, today about a class action or numerous class action suits for C&R (numerous may be required due to individual state laws). It looks very promising.

    Anyone interested, contact me through the AGA ( http://www.appraisersguild.org ) janbellas@appraisersguild.org or mike@mfford.com

  2. While I agree that it is against conservative & free market principles to support a government board setting appraisal fees the lack of regulation on this issue has allowed the free market (via AMCs) to drive appraisal fees through the floor, effectively crippling the appraisal business. Fees are below what is necessary to do a credible job. So appraisers are incentivized to cut corners just to survive. In a true free market appraisers would compete for assignments based on the cost of actually meeting USPAP & lender guidelines. Instead we compete based on lowing fees to the point that compromising quality becomes just too high of a risk. If appraiser boards composed of appraiser representatives could establish a true reasonable & customary fee structure we might be able to save the business from itself. Without this I fear we will continue to “circle the drain”.

  3. So you are going to wait for HVCC, Dodd Frank, and the CFPB to regulate Customary and Reasonable Fees? How has that worked for you in the last decade? We have waited long enough. It’s time the States took on this for the appraisers. We will see how it goes next week on Augusta 19 when the Georgia Real Estate Appraisers board issues their final rule on Customary and Reasonable Fees.

    • I agree. I also would like to know what’s the difference between BREA and an appraisal board?

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