Professional association is fighting accusations that it knowingly reported inaccurate exam scores to state agencies and ignored a top executive’s alleged sexual harassment of multiple employees.

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The Appraisal Institute, a professional association of real estate appraisers, is in turmoil following allegations that a top executive sexually harassed employees and that the association has been knowingly reporting inaccurate exam scores to state agencies.

Alissa Akins, the Appraisal Institute’s former director of education and publications, sued the association on March 28, alleging she was fired from her job in December in retaliation for exposing problems with the administration of licensing exams used by state regulators.

One of the Appraisal Institute staffers Akins accused of retaliating against her — Vice President Craig Steinley — is named in a May 8 wrongful termination lawsuit filed by former Appraisal Institute CEO Cynthia Chance, who accused Steinley of groping her and making lewd comments about her.

The Appraisal Institute “categorically and whole-heartedly denies that it has at any time engaged in fraudulent or retaliatory conduct,” in its administration of licensing exams or in its dealings with Akins.

Steinley’s attorney told The New York Times that he “wholly denies any allegations of any unwanted touching or harassment. It simply did not occur.”

The New York Times‘ Debra Kamin — whose 2023 exposé of allegations of sexual harassment at the National Association of Realtors led to the resignation of NAR President Kenny Parcell — last week published details from interviews with 12 women “who said they have had uncomfortable interactions with Mr. Steinley.”

Kamin, who interviewed more than 20 appraisers and former Appraisal Institute staff members, obtained a confidential legal settlement in which the association paid $412,000 to settle a sexual harassment claim by former Chief Financial Officer Beata Swacha.

The Appraisal Institute has “fielded similar complaints from at least seven other women that have swirled within the group over the last decade,” Kamin reported.

After The New York Times story went live, more than 200 people signed a Change.org petition “urging the board of directors to take immediate action to remove Craig Steinley from his position.”

On Monday, Appraisal Institute President Paula Konikoff posted on LinkedIn that Steinley had “decided to step away from his public [Appraisal Institute] officer appearances, effective immediately.”

Steinley informed the board that he was acting “out of consideration for and in the interest of not being a distraction to the important and ongoing work of the organization and will cooperate with any investigatory effort.”

Steinley’s attorney, Craig Capilla, told Kamin Monday that Steinley “has not resigned. This is still an ongoing issue. I don’t think final decisions have been made.”

The Appraisal Institute did not respond to Inman’s request for comment on the allegations against it, nor on Steinley’s current employment status. A statement by Konikoff on the allegations detailed by The New York Times features prominently on the association’s homepage.

Konikoff’s statement formally acknowledges “those who participated in the article and the seriousness of what they said.”

“Let me be clear: The Appraisal Institute is committed to a safe and respectful environment for all our employees and members, and nothing short of that is OK,” Konikoff wrote. “We have policies that prohibit — and are there to ensure — we promptly address any reports of discrimination, harassment or retaliation.”

The Appraisal Institute maintains that allegations it ignored Akins’ warnings about its examination processes or retaliated against her “are not true, and we will fight this lawsuit in court.”

In her March 28 complaint, Akins said that after being hired in February 2024, she discovered that due to inconsistent updates of minimum passing scores that vary by state, the Appraisal Institute had in some years mistakenly passed students who failed, and in other years failed students who passed.

A rescoring of a random sample of 300 Appraisal Institute exams found at least 17 percent had been scored incorrectly — raising the possibility that hundreds of people were wrongly certified as appraisers — or were told they’d flunked exams they’d actually passed, Kamin reported.

The Appraisal Institute “knowingly reporting inaccurate exam scores to state agencies” as far back as 2020, Akins’ suit alleged.

When Akins discovered the issue and put forward a plan to correct it, the Appraisal Institute “refused to take action or make any of the suggested improvements,” her lawsuit claims. So Akins “demanded that her signature be removed from the certificates evidencing successful completion of a course, including passing the course exam.”

Akins claims in her suit that she was told if she did not resign, Steinley “will make it hell for you as long as you stay” and that she was fired when she refused.

In seeking to dismiss Akins’ lawsuit in a May 2 filing, attorneys for the Appraisal Institute said her complaint “fails to state any claim upon which relief may be granted,” and that even if proven, her allegations “are inadequate to allege fraud.”

Tackling appraisal bias

Increasing diversity in the appraisal profession is one of the goals the Biden administration outlined in launching an initiative to combat appraisal bias in 2022.

The initiative was sparked in part by media reports of Black families receiving higher appraisal values after removing indications of their race, and evidence of a wealth gap created in part by a history of bias in home appraisals.

As the Appraisal Institute’s president in 2023, Steinley testified at a public hearing that bias in real estate appraisal “can be unintentional. To mitigate bias, appraisers should be aware of the potential for bias and base opinions on rigorous analysis and research. Best practice relies on multiple data sources and techniques to enhance credibility of the opinion of value.”

The Appraisal Institute has participated in an Appraiser Diversity Initiative with Fannie Mae, Freddie Mac, and the National Urban League, and offers scholarships, workshops and other resources to those interested in becoming appraisers.

But under the leadership of Trump appointee Bill Pulte, Fannie and Freddie have been told to discontinue Equitable Housing Finance Plans that included initiatives to combat appraisal bias and promote greater diversity in the appraisal field.

Last year, The Appraisal Foundation, which is responsible for setting standards and qualifications for real estate appraisers, reached an agreement with the Department of Housing and Urban Development aimed at opening up the field to more Black people and people of color.

While HUD officials called the agreement “groundbreaking” and “historic,” The Appraisal Foundation emphasized that it had already undertaken more than a dozen steps outlined in the agreement.

In March, under the leadership of Trump appointee Scott Turner, HUD informed FHA lenders that they’ll no longer be required to follow procedures enacted last year to better protect borrowers against discriminatory appraisals.

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Email Matt Carter

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