Broker-in-Charge Angela supervises a firm with five affiliate brokers. Affiliate Broker Mark, without Angela's knowledge, deposits a buyer's $8,000 earnest money check into his personal savings account, intending to transfer it to the firm's trust account the following week. The buyer later complains to TREC. Under Tennessee license law, which of the following most accurately describes the potential liability?
Correct Answer
D) Both Mark and Angela may face disciplinary action because Angela, as Broker-in-Charge, has supervisory responsibility for affiliate brokers under her license
Under Tenn. Code Ann. § 62-13-312 and TREC rules, a Broker-in-Charge has supervisory responsibility for all affiliate brokers operating under the firm's license. When an affiliate broker commits a trust account violation, TREC may pursue disciplinary action against both the affiliate broker who committed the act and the Broker-in-Charge who failed to adequately supervise. Angela's lack of actual knowledge does not eliminate her supervisory liability; the BIC designation carries an affirmative duty to establish and enforce proper trust account procedures.
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Related Topics & Key Terms
Key Terms:
Related Concepts
Commingling is the illegal act of mixing client trust funds with a broker's personal or business operating funds; conversion is the misappropriation of those funds.
Continuing education (CE) refers to the ongoing coursework that licensed real estate professionals must complete during each renewal cycle to maintain an active license. CE ensures agents stay current with changes in laws, regulations, and industry practices.
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.
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