Under TREC rules, which of the following best describes the relationship between a broker and the funds in the trust account?
Correct Answer
A) The broker holds the funds in a fiduciary capacity for the benefit of the clients and third parties
The broker holds trust account funds in a fiduciary capacity. The funds belong to clients and third parties, not to the broker. The broker's role is custodial — safeguarding the funds until they are disbursed according to the terms of the applicable agreements.
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