11.3 Prohibited Practices: Misleading Marketing, Telemarketing, Client Money and Sanctions
Key Takeaways
Under Cabinet Resolution No. 56 of 2024, in force since 27 August 2024, marketing calls are allowed only between 9:00 am and 6:00 pm.
The telemarketing rules forbid calling back a consumer who rejected the offer on the first call, and limit unanswered call-backs to once a day and twice a week.
Telemarketing must use local numbers registered to the company and must not call numbers on the Do Not Call Register.
Bylaw No. 85 of 2006 makes a broker the trustee of money and items received from the parties (Article 21).
Bylaw penalties are notice, warning, suspension of up to six months and blacklisting, with cancellation for ethics breaches or three black points (Articles 39–40).
11.3 Prohibited Practices: Misleading Marketing, Telemarketing, Client Money and Sanctions
The final ethics section pulls together the conduct that regulators most often penalise. For each practice, know the rule and the consequence.
1. Misleading and unpermitted advertising
| Practice | Why it is prohibited | Rule |
|---|---|---|
| Advertising with no permit, an expired permit or someone else's permit number | Every property advert needs a valid Trakheesi permit; DLD names these three violation types | DLD advertising rules; Madmoun QR code since 24 April 2023 |
| "Bait" listings (a cheap unit that does not exist or is already sold, used to collect leads) | Misleads consumers and uses a permit that does not match the property | Advertising rules; Bylaw Art. 22 liability for deceit |
| Marketing off-plan units without the developer's DLD authorisation and a registered marketing agreement | Developers need DLD's written authorisation to advertise, and brokers need a marketing agreement registered with DLD | Law No. 8 of 2007 Art. 5; EC Resolution No. 6 of 2010 Art. 10 |
| Presenting projections as guaranteed returns or gross yields as net | Misrepresentation of material facts | Bylaw Arts. 17, 19, 22 |
DLD has applied progressive AED 50,000 fines for advertising violations, with possible licence cancellation for repeat offenders.
2. Telemarketing (Cabinet Resolution No. 56 of 2024)
The UAE's telemarketing rules, issued with a separate penalties resolution (Cabinet Resolution No. 57 of 2024), took effect on 27 August 2024 and apply to all UAE-licensed companies, including free zone companies. Key rules for brokerages:
- Obtain the required prior approval and make calls only from local numbers registered to the company; individuals may not telemarket without a licence.
- Call only between 9:00 am and 6:00 pm.
- Do not call numbers on the Do Not Call Register (DNCR).
- Do not call a consumer back if they reject the product or service on the first call.
- If the consumer does not answer or ends the call, do not call back more than once a day and twice a week.
- Avoid unjustified pressure and misleading statements, and ask whether the consumer wants to continue the call.
Buying personal contact lists also raises personal data protection issues under Federal Decree-Law No. 45 of 2021.
3. Client money
- Trustee rule (Bylaw Art. 21): a broker is the trustee of any money, securities, bonds or items delivered by a party for safekeeping or delivery, and must deliver them as agreed.
- Form F deposit: the deposit cheque is held on trust and released only on both parties' written instructions or a court order.
- Off-plan money: sale proceeds go into the project escrow account, not the broker's account, and commission may not be deducted first (EC Resolution No. 6 of 2010, Art. 12).
- Rent and deposits: cheques should be made out to the landlord (or the landlord's licensed manager), never to an agent personally.
- Cash: avoid it; a freehold sale with AED 55,000 or more in cash, or with virtual assets, must be reported to the FIU through a REAR (Chapter 12).
Using client money for personal purposes is not just a disciplinary matter: it can amount to the criminal offence of breach of trust under the UAE Penal Code, alongside civil liability.
4. Other prohibited conduct
| Conduct | Consequence |
|---|---|
| Practising without a licence or card, or letting an unlicensed person practise | No right to commission; violation action; a developer dealing with an unregistered broker commits an offence under Law No. 8 of 2007, Art. 16 |
| Helping a client understate the price to reduce DLD fees | Fine of double the evaded fee for the evader and any broker or developer who helps (EC Resolution No. 30 of 2013, Arts. 5–6) |
| Facilitating a transaction that breaks the law (nominee ownership, sales before project approval) | Prohibited by Bylaw Art. 18; such agreements are void (Law No. 7 of 2006 Art. 26; EC Resolution No. 6 of 2010 Art. 11) |
| Taking secret benefits from the other party | Forfeiture of remuneration (Bylaw Art. 23) |
| Tipping off a client about a suspicious transaction report | Criminal offence under the AML law (Chapter 12) |
5. The sanctions framework
Remember that a registered broker can also lose status by ceasing business or suspending it for more than 12 months without an accepted reason (Art. 41), and that DLD must notify the licensing authorities of any suspension or cancellation (Art. 42).
A new agent buys a list of 5,000 owners' mobile numbers from an unknown website and starts cold-calling at 8:45 pm on a Tuesday from a personal mobile phone. Which rules are broken?
None, if fewer than five owners complain
None, because real estate brokers are exempt from telemarketing rules
Only the rule to quote the BRN at the start of each call
Several: Cabinet Resolution No. 56 of 2024 allows marketing calls only from 9:00 am to 6:00 pm and from local numbers registered to the company, and bars calling DNCR-registered numbers; the bought list also raises data protection issues
An agent asks a tenant to pay an AED 18,000 deposit in cash and the first AED 45,000 rent cheque into the agent's personal account, then uses the money to pay personal debts, intending to repay the landlord later. How is this treated?
A minor irregularity fixed by paying a late Ejari fee
Acceptable if the brokerage has professional indemnity insurance
Acceptable if the money reaches the landlord within 14 days
A serious breach: a broker holds money from the parties as a trustee (Article 21 of Bylaw No. 85 of 2006), and misusing it can lead to cancellation of registration, civil liability and criminal prosecution for breach of trust
A consumer tells a brokerage telemarketer on the first call that they are not interested. Under Cabinet Resolution No. 56 of 2024, what may the brokerage do next?
Call again the next day with a different offer
Not call the consumer back about that product or service
Call back twice a week until the consumer agrees
Send a representative to the consumer's home
Sections you finish are checked off in the contents.