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Panel approves bill requiring brokers to disclose referral fees in writing
Summary
House Bill 12‑52 would require licensed brokers to disclose in writing when they receive referral compensation; the committee adopted a chairman’s amendment clarifying broker‑company responsibility and approved the measure unanimously.
Representative O’Brien presented House Bill 12‑52 as a consumer transparency measure that would require disclosure of referral compensation between real estate brokerages at the time the referral is made. "It’s a straightforward consumer transparency bill," O’Brien said, noting co‑authors and support from industry stakeholders.
Maggie McShane, senior vice president of government affairs for the Indiana Association of Realtors, testified the industry supports the bill and the chairman’s amendment that replaces "licensee" with "broker company" and clarifies that disclosure is required when compensation is exchanged. She said the bill does not require disclosure of the dollar amount of any referral; rather it requires written notice that a referral fee may be paid when the referral converts.
Committee members asked whether the amended language would be enforced through existing forms and practitioner obligations; McShane said standard industry forms and agreements would be updated to implement the change.
The committee took the bill as amended and recorded a unanimous committee vote to advance it (13‑0). The committee cited the chairman’s amendment and testimony as clarifications for implementation.
Next steps: The bill was reported out of committee as amended and will proceed toward floor consideration.
