Sales Associate Rick at Panhandle Realty in Oklahoma City is representing buyer Nora under a written buyer representation agreement. During the transaction, the seller's listing agent, Sue, offers Rick a $500 bonus directly from the seller if the deal closes by the end of the month. Rick does not disclose this bonus offer to Nora. Which of the following best describes the legal and ethical consequences of Rick's failure to disclose?
Correct Answer
B) Rick's conduct violates his fiduciary duty of loyalty and the duty to account, and must be disclosed to Nora under Oklahoma agency law.
Under Oklahoma agency law, a buyer's agent owes the client the fiduciary duties of loyalty and accounting (also called disclosure of conflicts). Receiving an undisclosed financial incentive from the seller's side creates a direct conflict of interest — Rick has a personal financial incentive to pressure Nora to close quickly, which may not be in Nora's best interest. Oklahoma law requires that any compensation or bonus received from a party other than the client must be fully disclosed to the client. Failure to disclose violates the duty of loyalty and the duty to account, and constitutes grounds for OREC disciplinary action.
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