A federal congressional committee sent letters to Compass CEO Robert Reffkin and MRED CEO Rebecca Jensen in relation to their partnership, scrutinizing the relationship between the nation’s largest brokerage and the Chicago-based MLS that is already at the center of a federal lawsuit.
The letters were penned by a subcommittee of the House Judiciary Committee and focus on private listings, alleging the partnership could harm consumers through reduced transparency or competition. RISMedia obtained one letter, addressed to Reffkin and signed by Scott Fitzgerald, Republican chair of the Subcommittee on the Administrative State, Regulatory Reform, and Antitrust.
An MRED spokesperson confirmed via email the MLS had received the letter.
“We look forward to responding and helping the committee understand our business practices. Whether it’s our customers or this committee, we’re always happy to help,” the spokesperson said.
A Compass spokesperson declined to comment, and voicemails left for members of the committee were not immediately returned.
The letter focuses on “allegations that certain real estate companies have engaged in anticompetitive practices designed to insulate themselves from competition at the expense of consumers,” and requests a “briefing” on Compass’s business practices, including private listing networks and the MRED partnership “no later than 10 a.m. (eastern time) on August 5.”
The letter further claims that the MRED-Compass partnership “will offer real estate agents ‘off-MLS listings’ that are not available to the general public.”
“This partnership, and the expansion of PLNs more generally, has raised concerns about the information that will be available to consumers and the effect that it could have on housing affordability,” Fitzergerald wrote.
The letter also touches on alleged issues with dual agency and double-ended deals—something Compass has vehemently denied is a motivation for its push for private listings, and previously described as not meaningful from a financial standpoint.
“(W)e write to request a briefing to better understand Compass’s partnership with MRED and the effect that MRED’s PLN is likely to have on the information available to consumers,” the letter reads.
The federal spotlight comes as real estate practices in general are still under a microscope. Multiple lawmakers have urged regulators to examine lead diversion practices commonly used by portals like Zillow and Realtor.com®, and Compass’s deal with Anywhere is facing a state-level probe in New York City from law enforcement.
Zillow sued both Compass and MRED shortly after their partnership was announced, claiming that Compass sought to undermine its business in violation of antitrust statutes. A federal judge is currently mulling whether to stop MRED from cutting off Zillow’s listing feed—something the brokerage has suggested multiple other MLSs do.
This is a breaking story. Stay tuned to RISMedia for updates.
Editor’s note: this story was updated with information from the letter addressed to Robert Reffkin.
