Broker-salesperson Kevin works under supervising Broker Helen in Parsippany. Kevin negotiates a rental transaction and collects a $2,400 security deposit directly from the tenant, made payable to Kevin personally. Kevin deposits the check into his personal savings account, planning to write a check to Helen the next day. Helen is unaware of this arrangement. Under New Jersey law, which of the following statements is most accurate?
Correct Answer
B) Kevin has committed commingling and conversion; Helen may also face disciplinary action for inadequate supervision
Kevin has committed commingling by depositing client funds (the security deposit) into his personal savings account, mixing client money with his own personal funds. He has also committed conversion by using (or risking the use of) those funds in a personal account for even a brief period. Under N.J.S.A. 45:15-17 and NJREC regulations, Helen as the supervising broker may also face disciplinary action because brokers are responsible for supervising the activities of their affiliated salespersons and broker-salespersons. Inadequate supervision that allows a licensee to mishandle trust funds is itself a violation of the broker's duties.
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Related Topics & Key Terms
Key Terms:
Related Concepts
The National Do Not Call Registry is a federal program administered by the FTC that allows consumers to opt out of receiving unsolicited telemarketing calls, including calls from real estate agents soliciting business.
Brokers in Florida have strict responsibilities for managing escrow accounts, including monthly reconciliation and proper handling of trust funds.
FREC has the authority to impose fines and other disciplinary actions on licensees who violate real estate laws and rules.
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?
In Wyoming real estate practice, a first-time salesperson applicant completes coursework. What should the licensee remember?
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?
A responsible broker in Wyoming asks about a nonresident applicant provides home-state evidence. Which answer follows Wyoming law?
- → A responsible broker in Wyoming asks about a first-time salesperson applicant prepares for Wyoming-specific licensing. Which answer follows Wyoming law?
- → Which Wyoming rule applies when an out-of-state salesperson applies for Wyoming licensure?
- → A responsible broker in Wyoming asks about the Commission director receives a complaint about real estate practice. Which answer follows Wyoming law?
- → For the Wyoming salesperson state portion, a first-time Wyoming salesperson applicant starts the application process. Which statement is correct?
- → A Wyoming licensee is reviewing all first-time salesperson steps are otherwise complete. What is the best answer?
- → For the Wyoming salesperson state portion, a licensee asks how long Wyoming renewal periods are. Which statement is correct?
- → Which Wyoming rule applies when a licensee does not timely submit the complete renewal application, proof of CE, and renewal fees?
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- → A Wyoming licensee is reviewing a first-time salesperson applicant asks which prelicense courses are required. What is the best answer?
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