Broker Karen operates a real estate firm in Nashville. She maintains one trust account that holds earnest money deposits for pending sales transactions and also holds security deposits for rental properties she manages. A TREC auditor visits and reviews her records. Which of the following findings would represent a violation of Tennessee trust account rules?
Correct Answer
D) Karen's trust account balance exceeds the total of all client ledger balances by $200 of her own funds
Under TREC Rule 1260-02-.09, a broker may not commingle personal funds with trust funds. Holding $200 of the broker's own money in the escrow account beyond what is needed to open or maintain the account is impermissible commingling and is a clear violation.
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Related Topics & Key Terms
Key Terms:
Related Concepts
Market allocation is an illegal antitrust practice in which competing real estate brokerages agree to divide markets among themselves by geographic area, property type, or price range, thereby eliminating competition.
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.
More Practice Of Real Estate Questions
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