Question

Broker Brad accidentally deposited his commission in the trust fund account instead of his business account. Because it remained in the account for more than 25 days, he is guilty of:

Answer 1

Answer:

Commingling non-trust funds with trust funds

Explanation:

Trust funds

This is simply known as money or other valuable items that is received by the broker on behalf of another individual.

Non-trust funds

This are simply real estate commissions, general operating funds, rents and deposits.

Commingling

This is simply the act of combining a client's money with the agent's personal funds and it is illegal. It is the act of putting or depositing rent and security deposit into the trust account. When a Commissioner audits the account and sees either commingling of trust funds, the court may issue an order to restrain the broker from further mishandling of trust funds and from practicing real estate. It is a violation of real estate law if the trust account is commingled and it is considered commingling when the trust funds are first deposited into the general brokerage account and then transferred to the trust account.

If a licensee is found guilty of conversion of trust funds

1. There will be a revoke the license of the licensee.

2. The assets of the licensee may be sold to recover the converted funds.

3. The receiver account may be imposed on the licensee's assets in order to find and recover the converted funds.