Employing Broker Greg in Lakewood receives a $20,000 earnest money wire transfer from a buyer on a Monday. The wire is received and confirmed by the bank on Monday afternoon. Greg does not deposit the funds into his trust account ledger until Thursday, although the funds have been sitting in the trust account bank account since Monday. Greg argues that the three-business-day rule applies to when he records the deposit in his ledger, not to when the funds must arrive in the bank account. Under Colorado CREC rules, how should Greg's position be evaluated?
Correct Answer
D) Greg is incorrect because the three-business-day rule applies to the actual deposit of funds into the trust account bank, not to the ledger entry date
Under CREC Rule 6.5 and C.R.S. § 12-10-217, the three-business-day requirement refers to the actual deposit of funds into the trust account bank — meaning the funds must be physically in the trust account bank within three business days of the broker's receipt. In this case, the wire transfer was received and confirmed on Monday, so the funds were in the trust account bank on Monday itself, well within the three-business-day window. However, Greg's argument that the ledger entry date controls the compliance calculation is incorrect. The compliance date is the date of actual bank deposit, not the ledger recording date. Greg's delay in recording the ledger entry is a separate record-keeping compliance issue.
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Related Topics & Key Terms
Key Terms:
Related Concepts
Commingling is the illegal act of mixing client trust funds with a broker's personal or business operating funds; conversion is the misappropriation of those funds.
Continuing education (CE) refers to the ongoing coursework that licensed real estate professionals must complete during each renewal cycle to maintain an active license. CE ensures agents stay current with changes in laws, regulations, and industry practices.
The National Do Not Call Registry is a federal program administered by the FTC that allows consumers to opt out of receiving unsolicited telemarketing calls, including calls from real estate agents soliciting business.
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