Broker James operates a real estate office in Portsmouth, NH. His salesperson, Amy, is accused of accepting a secret referral fee from a mortgage broker without disclosing it to the buyer client. James claims he had no knowledge of Amy's arrangement. Under RSA Chapter 331-A, which of the following most accurately describes the likely outcome of a Commission investigation?
Correct Answer
B) Both Amy and James may face disciplinary action, as the broker has a duty to supervise and may be held responsible for failing to prevent the violation
Under RSA 331-A:26 and RSA 331-A:14, a supervising broker has an affirmative duty to supervise salespersons. While Amy is directly liable for accepting and failing to disclose the secret referral fee, James may also face disciplinary action for failing to maintain adequate supervisory oversight. The Commission may find that a reasonably diligent broker would have had policies in place to prevent or detect such violations. Lack of actual knowledge is not an absolute defense for a supervising broker.
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Related Topics & Key Terms
Key Terms:
Related Concepts
Price fixing is an illegal antitrust practice in which competing real estate brokerages agree to charge the same commission rates, fees, or other pricing for their services. It is a per se violation of the Sherman Antitrust Act.
Florida brokers are required to maintain transaction records and escrow records for a minimum of five years.
A tie-in arrangement is an illegal antitrust practice in which a seller conditions the purchase of one product or service on the buyer's agreement to purchase a separate product or service.
More Practice Of Real Estate Questions
In Wyoming real estate practice, an associate broker or salesperson is not associated with a responsible broker at renewal. What should the licensee remember?
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A Wyoming licensee is reviewing an out-of-state salesperson applicant prepares for testing. What is the best answer?
In Wyoming real estate practice, a salesperson applicant age is reviewed. What should the licensee remember?
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