The CAN (Certified Appraiser Names) website will periodically provide Education, Ethics and Regulations information for appraisers, clients, homeowners, lenders and the general public.
The CAN website will consider posting other appropriate information and topics if submitted in writing. Please send your information to AMC@CertifiedAppraiserNames.com with your telephone number for consideration.
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“A new Uniform Standards of Professional Practice (USPAP) Ethics Rule became effective on 01 January 2010. Please read below and understand this new USPAP Ethics Rule Conduct Section when accepting appraisal assignments.”
There are new rules that were effective 1/1/10 according to the 2010/11 Edition of USPAP. The new reporting requirements are listed below. At a minimum the appraiser should make a disclosure about his/her services provided for the subject property. If the appraiser has not provided any service that should be disclosed as well. This should be done in the Letter of Transmittal and in the Certification. When completing your review, you should look for this disclosure.
FOREWORD
The ETHICS RULE
Conduct Section
Prior to accepting an assignment, and if discovered at any time during the assignment, an appraiser must disclose to the client and in the report certification:
- any services regarding the subject property performed by the appraiser within the prior three years, as an appraiser or in any other capacity.
This disclosure requirement will allow a prospective client to know, at the time of the assignment, whether the appraiser is performing, or has performed, other services with regard to the property, such as property management, leasing, brokerage, auction, or investment advisory services, etc., thus allowing the client to determine potential conflicts, if any.
Whether for potential or perceived conflicts of interest, disclosure prior to accepting an assignment is important to preserving public trust. The client should have an opportunity to evaluate this information before the appraiser is engaged, or if such potential or perceived conflict of interest is discovered by the appraiser during the assignment. The appraiser must avoid bias – a preference or inclination that may preclude his or her impartiality, independence, or objectivity in the assignment. The perception of possible bias is also potentially damaging to public trust in the appraisal profession. Therefore, appraisers should have an obligation to disclose an interest and potential conflict to the client prior to being engaged in an assignment, or if it is discovered by the appraiser during the assignment.
From The Ethics Rule Conduct Section of USPAP Line 231 through 241 Page U-8.
If known prior to accepting an assignment, and/or if discovered at any time during the assignment, an appraiser must disclose to the client, and in the subsequent report certification:
- any current or prospective interest in the subject property or parties involved; and
- any services regarding the subject property performed by the appraiser within the three year period immediately preceding acceptance of the assignment, as an appraiser or in any other capacity.
Comment: Disclosing the fact that the appraiser has previously appraised the property is permitted except in the case when an appraiser has agreed with the client to keep the mere occurrence of a prior assignment confidential. If an appraiser has agreed with a client not to disclose that he or she has appraised a property, the appraiser must decline all subsequent assignments that fall within the three year period.
This information was provided by Dennis R. Greene, State Appraiser, 600 South 7th Street, Suite 1, Opelika, AL 36801. Mr. Greene’s telephone number is 334-745-7638 and the email address is dennis.greene@al.usda.gov.