Under RELA, a Pennsylvania broker, Diane, is charged by the SREC with failing to supervise a salesperson who committed fraud. Diane claims she had no knowledge of the salesperson's actions. Which statement is MOST accurate regarding Diane's liability?
Correct Answer
A) Diane may be disciplined for failure to supervise even without personal knowledge of the fraud, because brokers have a duty to supervise licensees under their authority
Under RELA (63 P.S. §455.604), brokers have a statutory duty to supervise all licensees operating under their authority. Failure to maintain adequate supervision is itself grounds for discipline, regardless of whether the broker had personal knowledge of the specific misconduct.
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