Under Illinois law, which of the following methods of paying commission to a sponsored licensee is prohibited?
Correct Answer
B) A buyer pays commission directly to the sponsored licensee at closing
Under 225 ILCS 454/10-20, all compensation to a sponsored licensee must flow through the sponsoring broker. A buyer, seller, or any other party to a transaction is prohibited from paying commission directly to a sponsored licensee. This rule ensures the broker maintains supervisory accountability over all compensation received by licensees operating under their license.
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Related Topics & Key Terms
Key Terms:
Related Concepts
An agency relationship created when a principal's actions or words lead a third party to reasonably believe that an agent has authority, and the principal fails to correct this belief.
An agency relationship created when a principal approves or accepts an agent's previously unauthorized actions, effectively granting authority after the fact.
The legal requirement for real estate agents to inform all parties about who they represent in a transaction, typically provided at first substantive contact.
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