I'm a newbie and just lost a listing from my sister because her husbands uncle said he'll give back their commission if they list/ and buy thru him. He is a part owner of a competing brokerage.
My question- can he legally do this?
For some reason, I feel this is a code of ethics violation, but since I'm new, I'm not sure.
I have no signed contract and have shown them no property as of yet. I did however email them some info about properties, per their request.
Is this typical par for the course in this business?
Thanks.

legal in some states, illegal in others. Check your state laws. Rebating was illegal in my state until last year; now we can do it under certain circumstances; it has to be disclosed in writing.
Your own sister? wow.

Yeah, I know, my own sister. I cant blame them for wanting to save some money, but gee whiz.
I'm in Ohio so I'll check our laws.
Next question- how awful would I be if it is illegal and I turn the chump in for it???
What a quandry.

He could also just be forfeiting some of his commission because he's representing family.
When brokers decide to rebate commission they usually know what they're doing and have it all set up so it's legal or perceived as legal under the letter of the law.
It's quite possible that if I was representing a family member, I would negotiate a lower commission for myself in hand with a lower sales price. Depending on the family member. ;-)
--A

I see what you mean. Yes, he could do this because he is a Broker, whereas, I am strictly an agent.
Thanks!

Oh not because he is a broker. You could do it too, as long as you followed the law and had your broker's permission.
--A

Read the State of Oh newsletter for this quarter it talks about this issue. An agent can rebate based on the sales price but not based on a percentage of commission. I have issues with this too. The state feels that it ok to share commission but you have to be careful how you write it up. 1% of the purchase price of the home is ok if you write it up that way, but written up as 50% of your commission gets you a go to jail card!

In lieu of paying the buyer’s agent co-op commission offered in the MLS, seller shall pay buyers closing cost to include..... up to 3% of the final purchase price. (or something like that)
That has always worked for me.