Under Wisconsin Statutes Chapter 452, a licensed Wisconsin real estate broker wishes to pay a finder's fee to an unlicensed person who referred a buyer that ultimately purchased a property listed by the broker. The unlicensed person did nothing more than provide the buyer's name and contact information. Which of the following best describes the legality of this payment under Wisconsin law?
Correct Answer
D) The payment is illegal because Wisconsin Statutes Chapter 452 prohibits brokers from paying compensation to unlicensed persons for activities related to a real estate transaction
Under Wisconsin Statutes § 452.14, a licensed broker is prohibited from paying compensation to any person for performing acts that require a real estate license unless that person holds a valid Wisconsin real estate license. Even a simple referral that results in a real estate transaction can constitute a licensed activity if compensation is paid for it. Paying a finder's fee to an unlicensed person for a real estate referral violates Chapter 452 and can subject the broker to disciplinary action by REEB.
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Related Topics & Key Terms
Key Terms:
Related Concepts
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.
A tie-in arrangement is an illegal antitrust practice in which a seller conditions the purchase of one product or service on the buyer's agreement to purchase a separate product or service.
More Practice Of Real Estate Questions
In Wyoming real estate practice, an associate broker or salesperson is not associated with a responsible broker at renewal. What should the licensee remember?
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