Broker Williams operates a Nevada real estate brokerage and employs several salespersons. She has been collecting earnest money deposits from buyers and placing them in her personal checking account rather than a dedicated trust account. Under Nevada law, which of the following most accurately describes this practice and its consequences?
Correct Answer
B) This practice constitutes commingling and is a violation of Nevada law, subjecting Broker Williams to disciplinary action including possible license revocation.
Under NRS 645.310 and NAC 645.050, a Nevada real estate broker is required to maintain a separate trust account for all client funds, including earnest money deposits. Placing client funds in the broker's personal account is commingling — one of the most serious violations under Nevada real estate law. Commingling is grounds for disciplinary action including suspension or revocation of the broker's license, regardless of whether any funds were actually misappropriated. The prohibition is absolute and does not depend on the amount or the broker's record-keeping.
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Related Topics & Key Terms
Key Terms:
Related Concepts
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.
A trust account, also called an escrow account, is a separate bank account maintained by a broker to hold funds belonging to others, such as earnest money deposits, security deposits, or other client funds.
Advertising regulations govern how real estate licensees may market properties and services, requiring truthful, non-deceptive advertising that includes proper identification of the brokerage.
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?
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- → A responsible broker in Wyoming asks about the Commission director receives a complaint about real estate practice. Which answer follows Wyoming law?
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- → For the Wyoming salesperson state portion, a licensee asks how long Wyoming renewal periods are. Which statement is correct?
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