Salesperson Maria is licensed in Louisiana and wants to earn a commission by selling a property owned by her cousin without disclosing their family relationship to the buyer. The buyer asks Maria directly if she has any personal interest in the transaction, and Maria says no. Under Louisiana license law, which of the following best describes the consequences Maria may face?
Correct Answer
B) Maria's action is a violation of the duty of disclosure; misrepresenting a material relationship to a client may result in LREC disciplinary action, including license suspension or revocation
Under Louisiana license law, licensees have a duty to disclose material facts, including personal relationships that could create a conflict of interest. A family relationship between the licensee and the seller is a material fact that must be disclosed to the buyer. By actively lying when directly asked, Maria compounded the violation. The LREC may impose disciplinary action, including suspension or revocation of her license, for misrepresentation and failure to disclose a material relationship.
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Related Topics & Key Terms
Key Terms:
Related Concepts
FREC has the authority to impose fines and other disciplinary actions on licensees who violate real estate laws and rules.
A group boycott is an illegal antitrust practice in which two or more competing real estate businesses agree to refuse to work with a specific person, company, or entity in order to harm that party's ability to compete.
In real estate, the distinction between an independent contractor and an employee determines tax treatment, liability, and the level of control a broker may exercise over the agent's daily activities. Most real estate agents operate as independent contractors.
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