Can a broker rip you off when selling your boat?

[Cwens]

Originally Posted by Knotical

This does not sound right - one of my friends and a fellow boater is also a broker and he says that by law he is required to reveal “all” offers to the seller, big and small, concealing high offers and then re-selling it means he’s going out of his way to do wrong, depending on the country the evidence (calls, texts, paper trail) can easily be discovered if the original seller is motivated.

Yes, the law, not to mention professional ethics, requires the broker to transmit all offers to the seller. I believe the OP was asking about how to protect himself against a broker acting illegally and fraudulently.

[S/V Illusion]

Originally Posted by ChrisOwens

This article says it's illegal in all but 3 states: https://www.vaned.com/blog/net-listing-real-estate/

Here's a specific reference for Massachusetts: https://www.mass.gov/service-details...nd-regulations

You might want to re-read your links as they say no such thing.
Neither of your links applies to boat sales from what I read there. Further, in two of the three states referenced, net listings are not prohibited even in real estate transactions.

Further, nothing I suggested precludes a broker from disclosing all offers including those lower than a set minimum.
What am I missing?

[Cwens]

Originally Posted by S/V Illusion

You might want to re-read your links as they say no such thing.
Neither of your links applies to boat sales from what I read there.

And you may wish to re-read my post, in which I clearly stated that I was speaking of real estate brokerage:

Originally Posted by ChrisOwens

In real estate brokerage (which is legally and practically different from yacht brokerage, but there is significant overlap), such an arrangement, termed a "net listing" is very much illegal [...]

Originally Posted by S/V Illusion

Further, in two of the three states referenced, net listings are not prohibited even in real estate transactions.
What am I missing?

You might be missing the part where the article said that the practice was only legal in the three states listed, and banned in other states?

[S/V Illusion]

Originally Posted by ChrisOwens

And you may wish to re-read my post, in which I clearly stated that I was speaking of real estate brokerage:

?

Why bother to interject something totally irrelevant to the discussion? How is that helpful to anyone here?


Geeeeeeez.

[Sailor Sailor]

Can an agent or broker do this? Not legally, but possibly. An agent is not allowed to engage in self-dealing - putting his or her own financial interests above yours. Does it happen? Yes, of course, it happens all the time. Some people are corrupt, and have no ethics or morals.

How do you prevent an agent from selling to a straw buyer for a more profitable resale at your expense?

1. Pick a reputable, successful agent or broker who is not financially desperate. 2. Track his or her efforts to make sure the property is being fully exposed to the market of potential buyers. 3. Understand the fair market value of what you are selling.

How did you decide that the Caribbean was the best place to sell this vessel? How did you determine the FMV of your vessel? Don't answer - the broker told me the FMV.

Frankly, in light of all the hurricane damaged boats in that area that might have been repaired, I wouldn't buy there.

[Cwens]

Originally Posted by S/V Illusion

Why bother to interject something totally irrelevant to the discussion? How is that helpful to anyone here?


Geeeeeeez.

I don't believe it's irrelevant in the slightest. As I clearly stated, real estate is legally and practically different from yacht brokerage, but there is significant overlap, and the general principles of brokerage and fiduciary duty apply irrespective of the item being sold.



I'll stand 100% by my contributions having added value to this discussion. You seem to be in a mood to argue for no particular reason. Piss off and go bother someone else somewhere else.

[mvweebles]

Originally Posted by DavidN

...a broker in the Caribbean for sale. How do i know the broker isn't selling the boat at a higher price via a dummy buyer and pocketing the difference plus the commision?

You don't know and unlikely to find out. In fact, it may not even be illegal in whatever Caribbean country your boat is located. For example, while not a boat transaction, I have seen lawyers in Mexico do things that are perfectly legal but would get them disbarred in the US.

[S/V Illusion]

Originally Posted by ChrisOwens

I don't believe it's irrelevant in the slightest. As I clearly stated, real estate is legally and practically different from yacht brokerage, but there is significant overlap, and the general principles of brokerage and fiduciary duty apply irrespective of the item being sold.



I'll stand 100% by my contributions having added value to this discussion. You seem to be in a mood to argue for no particular reason. Piss off and go bother someone else somewhere else.

That’s mature.

Clearly, someone was asking about a boat sale to which I commented and you interject an irrelevant issue which is not legally (or in any other context) transposable or extrapolated to boats which serves only to confuse the issue.

We are here to either learn or impart some knowledge, not make value judgment what someone chooses to do. I merely offered a valid alternative which you seem to dislike because it doesn’t conform to your perspective.

That seems to be a common malady some suffer from these days.

[valhalla360]

Originally Posted by ChrisOwens

In real estate brokerage (which is legally and practically different from yacht brokerage, but there is significant overlap), such an arrangement, termed a "net listing" is very much illegal in most US jurisdictions. It is considered a bad idea because it runs counter to the principle that the broker has a fiduciary responsibility to get the seller the best possible deal.

Maybe true but if you don't find out about it and make a claim to the authorities, so what? The law is only as good as the enforcement.

If you think the broker is gaming you, pull the listing and get a different broker (per rules of the brokerage contract you signed). But ultimately, if you get an offer and you agree to, that's the end of it. Just move on with life.

[goboatingnow]

Originally Posted by ChrisOwens

That doesn't help with the scenario in which the broker passes along to you the low offers but conceals a high offer; you sell to the best of the low offers, who turns out to be a shill buyer who turns around and sells it to the high offer buyer.

If you get your asking price why are you worried. Ultimately you sell the boat for whatever money you accept. WhAt happens after that is irelevant

[NPCampbell]

Our family has first hand experience with a crooked real estate broker when we tried to sell some acreage while we were overseas.

The broker listed the property and we only got low-ball offers until finally a LLC offered us about 10% below the asking price. We assumed the market was depressed in our area and traveled back to the states to sell the property.

Prior to the sale, we were removing assets from the property and a potential buyer drove up and asked if we were the owners and why we hadn't returned his phone calls. The broker denied receiving the calls.

We punted the broker and re-listed the property. Later, after returning overseas, we discovered the original broker had a financial interest in the LLC that gave us a low offer. I believe laws like RESPA only cover unethical payments during the settlement process. It doesn't prohibit the listing agent from buying your property at a lower than market value price.

[StuM]

Originally Posted by ChrisOwens

Yes, the law, not to mention professional ethics, requires the broker to transmit all offers to the seller. I believe the OP was asking about how to protect himself against a broker acting illegally and fraudulently.

The OP is asking about a " broker in the Caribbean". There's no telling what is illegal or fraudulent given the available information. We don't even know whether there is any licencing requirement to be a "broker", whether there is any legislation concerning broker actions or whether the broker in question is legitimate.


So to answer the OP's question:
"Can a broker rip you off when selling your boat?"
Yes - especially in countries with lax legislation and/or enforcement.

[DavidN]

Hello

Original poster here.... thank you for all your replies. Can I just add that I am not saying the broker has done anything wrong yet, i am asking the question of is there a way to check. A friend asked me how do i know the broker isn't selling it at a lower price to his friend to re-selling it at a higher price to a buyer he already has and i didn't have the answer so asked here. Also the broker had a higher bid a few weeks back and then it vanished, he said they walked away and then all bids are now coming in $20-30k lower so I'm getting suspicious.

The boat was left at the beginning of the hurricane season in the south of the Carribean and then I decided to sell it due to having a baby so I don't really have the luxury of moving it and i'm not about to sail 10 days or whatever it is to Florida or Bahamas to re-list it. There is literally 1 broker on the island where I left it so I can't change brokers. Also as i said he may be doing nothing wrong and be legit but i'm just raising the question of how do I check or find out if he is doing this as the boat won't be re-listed after sale if he already has a buyer. In response to someone saying it may be worth less than you think, whilst it was an ex-charter boat, when i got it in 2019 I totally re-did everything. In fact i wanted a charter boat as I was going to strip out everything and re-do it with all brand new stuff... all B & G Zeus 3 gear, 4g radar, forwardscan etc etc, a dual membrane water maker, 1600w of solar, generator, brand new digny, new outboard, scuba compressor, offshore 6 person life raft, epirbs, life jackets with built in Epirb and McMurdo Fastfind, new rigging etc etc... i didn't want some semi decent stuff in there that i was going to rip out anyway and re-do so went for a 5 year old charter boat with basic equipment as was kitted out for charter and then spent money on making it good for offshore and long term cruising. Sadly life got in the way and i needed to put the boat up for sale this summer. Foolishly I told the broker i needed the money by end of Sept which i kind of do as want to use it on a House.

I did like initially the idea of setting a minimum but with commission i thought they would want the higher price anyway. Plus nearly every broker just lists a boat on Yachtworld and thats it so I didn't feel it warranted me saying he could keep the rest as if i got my min price wrong he could walk away with $50k+ from doing not a lot of work and i shouldn't have to bribe someone to be honest and do their job. It's like negotiating with terrorists you don't do it as it just encourages more bad behaviour and more sharks to enter the market if people start doing this.

Thanks for all your replies but it seems there is little i can do apart from just ask him straight up and keep an eye on it. I was hoping there was some sort of system in place with the registrars or something. Can I monitor the boat after i sell it and see if it is re-sold? Is there a way? It will be very easy to publish the information if he does do this and it gets re-sold within weeks of me selling it and i can let him know i'll be keeping an eye on it. Again i must stress there is no evidence he has done anything wrong and i'm not accusing anyone of anything i just want to protect myself as best i can for all eventualities and i'm asking the question that is all.

Thanks

David

[StuM]

Originally Posted by DavidN

I was hoping there was some sort of system in place with the registrars or something. Can I monitor the boat after i sell it and see if it is re-sold? Is there a way? It will be very easy to publish the information if he does do this and it gets re-sold within weeks of me selling it and i can let him know i'll be keeping an eye on it.

Is the vessel documented? If so what is it's flag country?

[JC Reefer]

Originally Posted by DavidN

Hello

Original poster here.... thank you for all your replies. Can I just add that I am not saying the broker has done anything wrong yet, i am asking the question of is there a way to check. A friend asked me how do i know the broker isn't selling it at a lower price to his friend to re-selling it at a higher price to a buyer he already has and i didn't have the answer so asked here. Also the broker had a higher bid a few weeks back and then it vanished, he said they walked away and then all bids are now coming in $20-30k lower so I'm getting suspicious.

The boat was left at the beginning of the hurricane season in the south of the Carribean and then I decided to sell it due to having a baby so I don't really have the luxury of moving it and i'm not about to sail 10 days or whatever it is to Florida or Bahamas to re-list it. There is literally 1 broker on the island where I left it so I can't change brokers. Also as i said he may be doing nothing wrong and be legit but i'm just raising the question of how do I check or find out if he is doing this as the boat won't be re-listed after sale if he already has a buyer. In response to someone saying it may be worth less than you think, whilst it was an ex-charter boat, when i got it in 2019 I totally re-did everything. In fact i wanted a charter boat as I was going to strip out everything and re-do it with all brand new stuff... all B & G Zeus 3 gear, 4g radar, forwardscan etc etc, a dual membrane water maker, 1600w of solar, generator, brand new digny, new outboard, scuba compressor, offshore 6 person life raft, epirbs, life jackets with built in Epirb and McMurdo Fastfind, new rigging etc etc... i didn't want some semi decent stuff in there that i was going to rip out anyway and re-do so went for a 5 year old charter boat with basic equipment as was kitted out for charter and then spent money on making it good for offshore and long term cruising. Sadly life got in the way and i needed to put the boat up for sale this summer. Foolishly I told the broker i needed the money by end of Sept which i kind of do as want to use it on a House.

I did like initially the idea of setting a minimum but with commission i thought they would want the higher price anyway. Plus nearly every broker just lists a boat on Yachtworld and thats it so I didn't feel it warranted me saying he could keep the rest as if i got my min price wrong he could walk away with $50k+ from doing not a lot of work and i shouldn't have to bribe someone to be honest and do their job. It's like negotiating with terrorists you don't do it as it just encourages more bad behaviour and more sharks to enter the market if people start doing this.

Thanks for all your replies but it seems there is little i can do apart from just ask him straight up and keep an eye on it. I was hoping there was some sort of system in place with the registrars or something. Can I monitor the boat after i sell it and see if it is re-sold? Is there a way? It will be very easy to publish the information if he does do this and it gets re-sold within weeks of me selling it and i can let him know i'll be keeping an eye on it. Again i must stress there is no evidence he has done anything wrong and i'm not accusing anyone of anything i just want to protect myself as best i can for all eventualities and i'm asking the question that is all.

Thanks

David

Where is the vessel located? The Caribbean is a big area. Sounds more like you are in some isolated island.

What is it listed at? And what are you seeing as low offers? Can’t tell if you listed it too high or what.

An island with 1 broker is an odd situation and I don’t see how you, the seller, would benefit in anyway trying to sell the vessel from there. Regardless of it the broker is trying to pull one on you.