Introduction

Developer company are losing millions of taka due to the lack of ethics in this industry. It is a national disgrace for the country. And it is time it stopped. Now a days consumers are not informed of the dangers involved with selling or buying real estate. Further, we believe that consumers are being deliberately and massively misinformed. Thousands of people are being deceived and misled, and until now, very little has been done to stop it. Ethics implicitly regulates areas and details of behavior that lie beyond governmental control. The emergence of large corporations with limited relationships and sensitivity to the communities in which they operate accelerated the development of formal ethics regimes.

Real Situation

Scandals:
The current lack of ethics in Developer Company is one of our greatest national scandals. It is hard for anyone who is not involved in the developer company industry to comprehend the magnitude of what goes on 'behind the scenes'. Thousands of consumers are being ripped-off. In these days of high consumer protection it is amazing that the ethical crisis in the real estate industry is scarcely mentioned. There are three reasons why consumer protection is so poor in this field: 1. Developer Company is a big money business: While 'cleaning up' the industry would be of enormous benefit to consumers, it would not be in the best interests of many agents and other businesses tied to the real estate industry.

2. The Developer Company Industry is 'controlled' by real estate agents: When governments want to know how to improve the developer industry they ask people who represent real estate agents. They rarely ask people who represent consumers. The developer industry not only deceives consumers, it also deceives governments. 3. Consumers lack knowledge: For many people, buying or selling a home is a once or twice in a lifetime experience. Consumers must rely upon agents to give them advice. This costs them thousands of dollars and much heartache. Also, many consumers never realise how much they are losing. They do not know what goes on 'behind the scenes'. One media researcher expressed it well when she said,

Consumer Loss:
We believe consumers lose an average of $10,000 when they sell their family home. Some people lose nothing, but others lose hundreds of thousands of dollars. Usually, the home is more expensive, the greater the loss. However, consumers should be protected from losses of any size. We are especially concerned with protecting consumers who can least afford to lose money the poor and the elderly. The widespread exploitation of these people by many agents has made us determined to improve the standards of ethics in Developer Company. The consumers who suffer the worst financial losses are generally the homesellers. We have ethical concerns about the following methods used by many real estate agents: Up-front expenses:

Consumers are often duped into paying money to agents before their homes are sold. If their home does not sell, or it sells for less than the consumer was led to believe, this money, which often amounts to thousands of dollars, is lost. Advertising: It is well known within the real estate industry itself that the main purpose of advertising is NOT to sell homes, but to raise the profile of agents. In many areas, the number of sales being made has declined, but in most areas real estate advertising has exploded as agents compete with one another to raise their own profiles. This is at the direct expense of home sellers. Conditioning: Conditioning is a method of talking homesellers down in price. Many agents use a series of standard conditioning letters or statements especially with auctions. One Real Estate Institute even conducted a course called, 'How to Condition Sellers'. In the book The Real Estate Office Manual published by the Real Estate Institute of Australia, auction is described as "the fastest and best conditioning method." False or Misleading Offers: Many agents submit offers to sellers which are lower than the offer actually made by the buyers. This is done to make the genuine offer look good when it is revealed later. It is a common deceit. The notes from one training course are quite specific, "If you get an offer of $270,000, convey to the owner a lower figure, say, $250,000." At other times, home sellers are given totally fictitious offers in order to convince them to lower prices. Bait Prices: Home sellers lose a lot of money when agents use 'bait' prices to attract buyers. Agents indicate to homebuyers that homes may sell for a low price when they know full well that the home sellers would never want such prices. Agents say this is designed to attract

buyers who can then be talked up in price. This ploy backfires on homesellers because it attracts many buyers who can only afford the low price. The agents then say to the sellers that "this is the most the buyers will pay." The truth is that the wrong buyers have been attracted. This method can be seen when a home is offered with a 'price range' or 'price from'. This is common with auctions or 'by-negotiation' sales.

Developer held on charge of cheating:

The managing director of a real estate company was arrested in the city on Tuesday in connection with cheating buyers of flats.Dhanmondi police arrested Khairul Hasan, MD of Al Hasan Developers Ltd, after Mohammad Wahidur Rahman, an expatriate in London, filed a case against him in this regard. Wahidur Rahman bought a flat of Holy Airab Palace constructed by Al Hasan Developers Ltd. Monwar Hossain, officer-incharge (OC) of Dhanmodni Police Station, yesterday said two more victims also contacted him to file cases against Khokan in this regard.

Meanwhile, complainant Wahidur Rahman told The Daily Star that the hired goons of Khokan were threatening him for filing case against him. He also lodged a general diary with Dhanmondi Police Station in this connection on Wednesday night.Besides, Rifzana Biswas, also a buyer of flat, told The Daily Star through an email that the company was dillydallying in handing over her flat although she had paid the money.Police said although the victim buyers paid the money for the flats according to the agreement, the developer company is yet to hand over the flats to them.Moreover, the company is selling out the flats to others at a higher rate.

CAUSES FOR LACK OF ETHICS

There are two main causes of the ethical crisis in real estate: The first is that governments and consumer protection bodies have never thoroughly investigated the real estate industry.

 The second cause is far more worrying. The real estate industry is controlled by real estate agents or groups whose primary concern is to represent agents not consumers. False and misleading information is regularly given to both governments and consumers.

Recommendation

Investigation: We believe there should be a full and independent investigation into the real estate industry. In our opinion, many of the common practices in real estate are not only unethical, they are also illegal. Australasian real estate consumers are losing millions of dollars. We would both support and welcome an unbiased investigation into the industry. Misinformation: There is far too much misinformation about the real estate industry. Systems which benefit agents and hurt consumers are given too much good publicity while systems which offer an alternative viewpoint receive little or no publicity. Some consumer information produced by The Jenman Group has even been banned from many newspapers because it is not in the best interests of those newspapers and real estate agents. The fact that it benefits consumers is considered irrelevant. DON'T SIGN ANYTHING:

Although the real estate industry is riddled with deceit and corruption it is not as complicated as many people think. It's only the tricks that are complicated. When you understand the tricks, you will be in control. You will be able to buy or sell with confidence. You might even enjoy it.