Marcia Hultman

Cabinet Secretary

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Appraiser Certification Program

Frequently Asked Questions - Allegation of Non-Compliance, Investigation and Complaint Process

The following FAQs are specific to the first allegation of non-compliance filed against an appraiser. Each case is unique; therefore, the responses are generalized and may not apply in every case.

Please note: The following are definitions for acronyms and terms used throughout the FAQs below.

Appraiser Certification Program: ACP
ACP Staff: Executive Director
Appraiser: The Appraiser that has had an allegation of non-compliance filed with the ACP
Complaining Party: The person(s) or entity that has filed an allegation of non-compliance with the ACP
Department: Department of Labor and Regulation
Trainee: State-Registered Appraiser

Allegation of Non-Compliance

Why do I get a certified letter of notification of allegation of non-compliance?

There are two reasons the notification is sent by certified letter:

To ensure the appraiser receives the notification; and
The appraiser is required to respond within so many days of receipt, and certified mailings provide notification of when letters are received.

When I first receive a notice of an investigation, what should be my first action?

Appraisers who receive a notice that the ACP is conducting an investigation should contact the ACP staff to make sure they understand what is being investigated, why there is an investigation, and what steps they can or should take in response to learning of the investigation.

Should I contact or hire an attorney?

An appraiser has the right to be represented by legal counsel.

Should I contact E&O?

An appraiser with questions regarding how an investigation impacts their errors and omissions insurance should contact the errors and omissions carrier.

Do I have the right to see the allegation?

Yes. The ACP staff provides a copy of the written allegation of non-compliance to the appraiser. The appraiser is asked to respond to the allegation and submit the appraisal with workfile.

Are there timelines involved?

Yes. An appraiser is required to respond to a notice of investigation within 14 days of receipt of the notice. A reasonable extension may be granted upon written request.

What are my consequences for not responding to the allegation?

The ACP staff will move forward with the investigation. It is in the best interest of the appraiser to respond to the allegation. The response is carefully considered and may provide important information to the reviewer that would otherwise not be available in the workfile.

If I hire an attorney can I communicate with the Department?

The ACP staff may not speak to the appraiser about the case. Once an attorney is hired in a pending matter, ACP staff may communicate with the attorney or in the presence of the appraiser’s attorney about the pending investigation.

Investigation

Is the review based only on the specific allegation?

No. The ACP conducts a USPAP Standard 3 review of the subject appraisal which includes the workfile and any other supporting documentation provided. The allegation is included in the case file submitted to the reviewer. The review is to determine the appropriateness of the appraisal’s conclusions, to discern the reasonableness of its value estimate, and to evaluate its compliance with relevant requirements of the Uniform Standards of Professional Appraisal Practice and the administrative rules regarding appraisers.

Can I meet with the complaining party?

No. The ACP does not arrange for a meeting between the appraiser and the complaining party. The focus of the investigation is to determine if the subject appraisal complies with the uniform standards and the administrative rules regarding appraisers. A meeting would not augment the investigation.

Can I know who the complaining party is?

A copy of the written allegation of non-compliance is provided to the appraiser. If the complaining party signed the allegation of non-compliance, the appraiser will know the identity of the complaining party. If the complaining party did not sign the allegation of non-compliance, the identity of the complaining party is unknown.

Does the examiner know my identity?

No. The appraiser’s identifying information is redacted from all of the case documents.

Will any other agencies be involved in the investigation?

Generally, no. However, if there are circumstances that warrant it, law enforcement, another state agency or another licensing entity may be contacted.

If an allegation is filed, is that public?

No.

If an investigation is commenced, does the department assume I am guilty of the violation(s) alleged?

No. An allegation is a claim of error or violation that has not yet been proven. There is an examination of the appraisal report and workfile to determine if there is evidence to support the allegation.

Can I call the Executive Director of the Appraiser Certification Program and check on the status of my case?

Yes, unless you are represented by an attorney, you may personally contact ACP staff regarding the status of a pending case. If you have retained an attorney, your attorney may contact the ACP.

Complaint

What is the difference between an allegation of non-compliance and a formal complaint?

1) An allegation of non-compliance is presented by a complaining party alleging non-compliance of the administrative rules regarding an appraiser.
2) A formal complaint stating the charge is entered by the Department Secretary if an investigation provides evidence of non-compliance.

Can discipline be negotiated?

An appraiser or an attorney of the appraiser may contact the ACP staff to discuss the terms of the disciplinary action to be taken by the ACP. The Department strives to resolve each case in a fair, equitable, and consistent manner.

Is there a positive to the process?

Yes. If deficiencies are identified in the review of work product, the Department may prescribe specific education to address the deficiencies in order to ensure the appraiser’s future work product complies with the uniform standards and the administrative rules regarding appraisers.

Can I speak with/meet the reviewer?

Yes, once the case is resolved through proper legal channels. If the deficiencies identified rise to the level of disciplinary action, the appraiser may meet with the examiner when the matter has reached a final disposition. The informal meetings provide practical guidance to the appraiser related to the cited deficiencies and how to improve work product in the future. These meetings have proven to be highly beneficial to the appraiser.

Can I be disciplined for the same violation if the same violation was identified in a previous complaint case?

Yes. The Department may take disciplinary action for the same type of violation identified in a previous case if, in a new case, the Department finds that the appraiser continued to make the same mistake following the identification of the violation in the previous case.

If the investigation shows deficiencies that rise to the level of disciplinary action, what are the disciplinary actions?

The Department Secretary has the authority to suspend, revoke, censure, reprimand; impose probation, or limit a scope of practice.

If I lose at hearing, will I be responsible for costs?

The Department Secretary may assess all or part of the actual expenses of a contested case proceeding resulting in discipline.

If there are proposed disciplinary actions to be taken against me, what can I do?

The appraiser has the right to resolve the matter through a formal hearing, to be present and to be represented by legal counsel, to introduce evidence and to present testimony, to call witnesses to testify, to cross-examine all witnesses present, and to submit argument at the hearing.

What are my options?

To resolve a formal complaint entered against an appraiser, the appraiser may request a formal hearing or can accept the proposed disciplinary action.

If I request a hearing, who hears the case?

The South Dakota Office of Hearing Examiners appoints an administrative law judge to hear each of the ACP’s contested cases. The administrative law judge renders a proposed decision for the Department Secretary’s consideration.

Who makes the final decision?

The Secretary of the Department is the final decision maker. The Secretary may accept, modify or reject the administrative law judges’ proposed decision.

Do I have the right to appeal the final decision?

Yes. The appraiser may appeal the Department’s decision to the circuit courts of South Dakota.

Supervisor/Trainee

If an allegation is filed against a supervisory appraiser will the trainee be able to continue appraising?

Yes. The right to practice continues until a final order that says otherwise is issued by the Department Secretary.

What happens to a supervisor if a trainee is under investigation?

Typically, the supervisor is a part of the investigation of an allegation by virtue of being the trainee’s supervisor and signing the certification.

Will the investigation involve both the supervisory appraiser and the trainee if both parties have signed the report?

Yes. Pursuant to the uniform standards, anyone that signs the certification takes full responsibility for the appraisal and report.

Miscellaneous

Is there an advocate/resource/mentor that can help me during the process?

The ACP staff does not have any information regarding an advocate/resource/mentor, however, appraisers are encouraged to contact their professional appraiser organization and/or other reputable professionals for information and support.