Nevada Real Estate Ethics,
Professional Standards
& Risk Management

Ethical conduct is not the same as legal compliance. The law establishes the floor — the minimum that society has decided to enforce through regulation and prosecution. Ethics asks a more demanding question: not merely what is permitted, but what is right. A person who stays just inside the boundaries of legality while acting in a manner that harms clients, deceives the public, or undermines the integrity of the profession has not behaved ethically, even if they have avoided a license violation.

At Strata, the standard is higher than the floor. The standard is conducting every transaction, maintaining every relationship, and communicating every piece of information in a manner that reflects the values of honesty, fairness, accountability, and respect — regardless of whether anyone is watching, regardless of whether the departure from that standard would ever be discovered.

An organization that operates with integrity does not behave differently when the Nevada Real Estate Division is watching than when it is not. It does not disclose material facts because it is required to — it discloses them because withholding material information from a client would be wrong. It does not maintain trust account records because it fears an audit — it maintains them because those records protect money that belongs to other people and those people deserve accurate accounting of their funds.

Integrity is not passive. It requires affirmative action — choosing to do the harder thing, the more time-consuming thing, the less profitable thing, because it is the right thing.

Books 1 through 5 of the Strata Compliance Library address operational, legal, and procedural standards for specific areas of brokerage activity. This manual, Book 6, provides the ethical and professional foundation from which all of those operational standards derive their meaning. Procedures without values produce compliant robots. Values without procedures produce well-intentioned chaos. The Strata Compliance Library requires both.

• Acting honestly in every communication, representation, and transaction
• Protecting the public from misrepresentation, deception, and harm
• Maintaining the trust of clients, owners, tenants, and the broader community
• Exercising sound professional judgment when rules do not provide a clear answer
• Placing integrity above convenience — choosing the right action even when it costs time, money, or comfort
• Preserving the long-term reputation of the brokerage by never sacrificing it for short-term advantage

Nevada's real estate licensing statutes impose affirmative ethical obligations on every licensee. Failure to disclose material facts, misrepresentation, commingling of client funds, and breach of fiduciary duty are not merely bad practices — they are grounds for license suspension and revocation. The profession's ethical standards exist because real estate transactions involve some of the largest financial decisions in most people's lives, and the public is entitled to rely on the integrity of the professionals they engage.

Beyond regulatory consequences, the practical consequences of unethical conduct include civil liability, reputational damage, loss of client relationships, and ultimately the erosion of the business itself. The ethical standards in this manual are not only morally required — they are professionally and commercially essential.

Ethical conduct is expressed in specific daily actions. An agent who discloses a property defect they know about, even though disclosure may complicate a transaction, is acting ethically. An agent who returns a client's call promptly, even when the news they must deliver is unwelcome, is acting ethically. An agent who declines an owner's instruction to misrepresent a property's condition is acting ethically. An agent who brings a question about proper conduct to the Broker rather than deciding unilaterally is acting ethically.

The ethical standard is most meaningfully expressed in the moments when doing the right thing is inconvenient, uncomfortable, or financially costly. Those are the moments that define the character of a professional and the reputation of a brokerage.

The Golden Rule at Strata applies equally to every person encountered in the course of professional practice. There is no tiered system under which some parties receive professional treatment and others do not:

• Sellers and Buyers — deserve accurate market information, honest representation, and transparent disclosure
• Landlords and Owners — deserve accurate financial reporting, honest advice, and professional management of their investments
• Tenants — deserve honest communication about their rights and obligations, professional maintenance management, and fair application of lease terms
• Vendors — deserve timely payment for authorized work and professional treatment
• Cooperating Brokers — deserve honest representation of client authority and ethical cooperation
• Members of the Public — deserve accurate information, non-discriminatory access, and professional service

Difficult News: An agent must advise an owner that the recommended rental rate is lower than the owner expected. Applying the Golden Rule, the agent delivers this news honestly with supporting market data, rather than inflating the recommended rate to please the owner in the short term.

Tenant Communication: A tenant's maintenance request has taken longer to resolve than it should have. Applying the Golden Rule, the agent contacts the tenant proactively to acknowledge the delay and provide a realistic resolution timeline — rather than waiting for the tenant to follow up again.

Adverse Information: An agent discovers during the leasing process that a property has a material defect the owner has not disclosed. Applying the Golden Rule, the agent brings the matter to the Broker immediately and ensures the required disclosure is made — even though the disclosure may complicate or delay the transaction.

Stewardship is the careful and responsible management of something entrusted to one's care by another. In the real estate profession, stewardship applies with particular force to three categories: client funds, client records, and client property.

Client funds — security deposits, rent proceeds, earnest money, owner reserves — are not the brokerage's money. They belong to specific individuals and are held in trust in a fiduciary capacity. Every dollar must be deposited promptly, maintained accurately, and disbursed only with proper authorization and documentation.

Client records must be maintained accurately, organized completely, protected from unauthorized access, and retained for the full required period. A file that cannot be produced, cannot be read, or cannot be found has failed the stewardship standard.

Client property — the homes and investment assets under Strata's management — deserves the same care and attention that a professional steward would give to their own property. Stewardship failures are often the first sign of broader ethical problems in a brokerage.

Professionalism at Strata is expressed primarily through communication. Timely communication means responding to clients, tenants, owners, and vendors within established timeframes — and proactively communicating important information without waiting to be asked. Accurate communication means verifying information before conveying it and correcting errors promptly when discovered. Respectful communication means maintaining a professional tone in every interaction, regardless of how the other party communicates.

Strata's long-term reputation is built transaction by transaction, interaction by interaction, decision by decision over years and decades. It is also damaged the same way — one transaction, one interaction, one decision at a time. A single significant ethical failure can erase years of reputation-building. A pattern of small ethical compromises accumulates into a reputation that no single action can repair.

The pathway from ethical failure to legal risk typically follows a recognizable sequence. An agent makes a small ethical compromise — failing to disclose a known defect, mischaracterizing a property's condition, applying screening criteria inconsistently. The compromise is rationalized as a minor deviation. No immediate consequence follows, which reinforces the rationalization and makes the next compromise easier. Over time, what began as a minor deviation becomes a pattern. The pattern eventually surfaces — in a client complaint, a regulatory inquiry, a lawsuit, or an audit.

The legal risks that flow from ethical failures include: license suspension and revocation by the Nevada Real Estate Division, civil liability for breach of fiduciary duty, civil liability for fair housing violations, civil liability for misrepresentation, and in cases involving trust fund misappropriation, criminal prosecution.

Strata's integrated ethics and risk management framework operates through five practical principles:

• Document everything material. Documentation is both an ethical obligation and a risk management tool.
• Disclose early and completely. Disclosures made proactively, early in a transaction, create less risk than disclosures made later under pressure.
• Escalate promptly. A concern escalated to the Broker when it is small is a concern that can be addressed. The same concern discovered after it has grown into a problem is significantly harder to manage.
• Follow procedure consistently. Consistent application of established procedures is both an ethical commitment and a risk management practice.
• Operate as though everything will be reviewed. The Nevada Real Estate Division, a court, or legal counsel may someday review any file, any communication, any trust account record created by this brokerage.

• Do I have a personal financial interest in this transaction that the client does not know about?
• Do I have a relationship with another party to this transaction that could affect my advice to this client?
• Am I recommending this vendor, this property, or this course of action because it is best for the client, or because it benefits me?
• Would a reasonable client who knew everything I know about this situation feel that my advice is compromised?
• Am I being compensated by anyone other than my client in connection with this transaction?

• Self-dealing — purchasing a client's property or transacting with a client without full written disclosure and explicit client consent
• Undisclosed interests — having any financial interest in a transaction without disclosing it to the client
• Favoritism — providing one client with information or service not provided equally to similarly situated clients
• Improper compensation — accepting compensation from any party to a transaction without disclosing it to all parties
• Undisclosed relationships — failing to disclose a personal relationship with any party to a transaction that could affect professional judgment

• False statements — any claim about a property, a service, or the brokerage that is not accurate
• Misleading claims — statements that are technically accurate but designed to create a false impression
• Deceptive photographs — images that misrepresent the property's current condition, size, or features
• Misrepresentation of services — overstating the brokerage's capabilities, experience, or market performance
• Material omissions — failing to include information that would materially affect a consumer's evaluation of the property
• Discriminatory language — any language that expresses a preference for or against any protected class
• Unauthorized advertising — marketing any property or service without the owner's authorization

All advertising produced under Strata's license is reviewed by the Broker or the Broker's designated compliance reviewer before publication. The 45-day advertising review cycle described in Book 1 applies to all active advertising. Any advertising found to be non-compliant is corrected or removed before the next business day following the review.

Federal (Fair Housing Act): Race, Color, National Origin, Religion, Sex, Familial Status, Disability

Nevada Additional (NRS Chapter 118): Ancestry, Sexual Orientation, Gender Identity or Expression

The Nevada standard, which is more protective than the federal minimum, is the operative standard for all brokerage activities. All of these classes are protected at Strata.

Common fair housing violations in property management include: applying screening criteria differently to different applicants; responding more slowly to inquiries or maintenance requests from tenants of one background than another; steering prospects toward or away from properties based on protected class characteristics; making statements about a neighborhood's demographic composition; refusing to process an assistance animal accommodation request; and advertising with language that implies a preference for or against any group.

Any fair housing complaint — whether received by phone, in writing, or through a regulatory agency — is escalated to the Broker the same business day it is received. No agent or staff member responds independently to a fair housing complaint. The Broker reviews the complete file, contacts legal counsel if warranted, and determines the appropriate response. All fair housing complaints and the brokerage's response are documented and retained for five years.

• The client's motivation for selling, buying, or renting
• The client's financial position and limitations
• The client's negotiating authority and bottom-line position
• Personal information shared in the course of the relationship
• Tenant screening data — credit reports, background check results, income information
• Disability and accommodation information shared in connection with assistance animal requests or reasonable modification requests
• Domestic violence documentation shared by a tenant invoking their statutory protections under Nevada law

The duty of confidentiality does not end when the professional relationship ends. A former client's confidential information is protected as fully as a current client's. An agent who represented an owner ten years ago is as bound to protect that owner's information today as they were during the representation. Time does not erode the obligation.

If the answer to any of the seven questions is no — or if the answer is uncertain — the proposed action is suspended. The agent brings the situation to the Broker, describes the concern, and receives direction before proceeding. This is not optional and it is not a sign of weakness. It is the correct professional response to an ethical question.

Passes All Seven: An agent receives an oral instruction from an owner to not accept applications from tenants with certain pets. Working through the Seven Questions: Is refusing applications based on pet ownership legal? — Yes, if no assistance animal is involved. Is it honest? Fair? Does it protect the client? Comfortable with NRED? Front page? Long-term reputation? — All pass. The agent proceeds.

Fails at Question 1: An agent is asked by an owner to not accept applications from families with young children. Is it legal? — No. Familial status is a protected class. The analysis stops. The agent declines the instruction and escalates to the Broker immediately.

When any of these warning phrases appears — regardless of who says it, what authority they hold, or what urgency they invoke — the required response is to stop, document the situation in writing, and bring it to the Broker before taking any action. The agent is not required to argue with the speaker or confront the situation publicly. The required response is to pause and escalate.

The Strata Ethics Charter is reviewed annually by the Broker as part of the annual policy review cycle. All affiliated licensees review the Charter as part of their annual review and confirm their understanding of and commitment to its principles. The annual review is documented in each licensee's file. The Charter is not a document signed once at onboarding — it is the living standard against which conduct is measured continuously.

• Encouraging ethical behavior through positive modeling, constructive feedback, and explicit recognition of ethical conduct
• Maintaining accountability — for the Broker's own conduct and for the conduct of all affiliated licensees
• Correcting errors promptly — including errors the Broker makes personally, disclosed with the same candor expected of everyone else
• Protecting trust funds with the personal supervisory attention required by Nevada law and described in Book 2
• Avoiding conflicts of interest and disclosing them when they cannot be avoided
• Upholding Nevada laws and regulations as the minimum standard, with Strata's own higher standards as the actual operating target
• Maintaining high standards of personal professional conduct — including continuing education and current knowledge of Nevada law

Supervision at Strata is not an administrative function — it is an ethical obligation. The Broker's responsibility for the conduct of all affiliated licensees means that inadequate supervision is not merely a management failure — it is an ethical failure. An agent who behaves unethically because the Broker failed to provide adequate guidance has been failed by the supervisory relationship. The Broker's oversight — described in detail in Book 1 — is the mechanism through which the ethical standards in this manual are operationally enforced.

• Convenience — speed of process and operational efficiency are legitimate goals that must be pursued within ethical constraints, not by sacrificing them
• Speed — urgency in a transaction does not create an exception to ethical standards; it creates a test of whether the standards will hold under pressure
• Ego — personal pride in winning or closing is not a professional justification for any ethical compromise
• Pressure — instructions from clients, owners, supervisors, or any other party to deviate from ethical standards must be declined
• Short-term profit — the financial benefit of a single transaction is never a justification for conduct that compromises the brokerage's long-term reputation and integrity

Operate every file, every transaction, every advertisement, every communication, every trust account, and every relationship as though it may someday be reviewed by:

• The Nevada Real Estate Division — which has the authority to audit records, investigate complaints, and discipline licensees
• A court — which may be asked to evaluate the agent's conduct in connection with a civil dispute
• A client — who deserves to know that every decision made in their representation was made with integrity
• Another broker — whose professional respect is earned through demonstrated professional conduct
• Future generations of Strata — who will inherit and build upon the reputation established by those who come before them

Reputation is not a marketing asset — it is the cumulative product of every decision, every interaction, and every professional relationship over time. It is built slowly, through consistent ethical conduct in circumstances where ethical conduct is difficult. It is damaged quickly, through single significant failures or through the gradual erosion of standards over time.

The most powerful reputation protection available to Strata is the consistent application of the standards in this manual. A brokerage that operates with integrity in every transaction has very little to fear from the most comprehensive audit. A brokerage that has corners cut, files incomplete, and disclosures omitted has everything to fear.