Practice Of Real EstateBrokerage_operationsMEDIUM
A broker deposits a tenant's security deposit into the brokerage's general operating account and uses some of the funds to pay office rent. What violation has occurred?
Correct Answer
B) Conversion of trust funds
Using client trust funds for personal or business purposes is conversion, which is illegal. Security deposits must remain in a trust account and cannot be used for the broker's expenses.
Answer Options
A
Proper use of operating fundsB
Conversion of trust fundsC
Legitimate commingling for business expensesD
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Related Topics & Key Terms
Key Terms:
brokerage_operationspracticetrust_accountconversion
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