A transaction broker discovers that the buyer and seller are actually related (brother and sister) but neither has disclosed this relationship. The price appears to be significantly below market value. What should the transaction broker do?
Correct Answer
B) Require both parties to acknowledge the relationship in writing and confirm the price
When related parties are involved in a transaction, especially at below-market prices, the broker should ensure full disclosure and acknowledgment to protect all parties and avoid potential issues with lenders or other parties. This ensures transparency and informed consent. A is incorrect because the relationship should be acknowledged formally. C is incorrect because family transactions aren't inherently fraudulent. D is incorrect because family transactions don't need to be reported as suspicious if properly disclosed.
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