Section 6: Florida Laws and FREC Rules Flashcards
Escrow account records must include
- Where funds came from
- When runds were received
- When funds were deposited
- Whre funds were deposited
- When the funds were disbursed
- Who received the disbursed funds and for what practice
Escrow account reconciliation must show:
- Dates reconciliation takes placed
- Names of banks, accounts, account numbers, account balance and dates
- Deposits in transit
- Outstanding checks (identified by date and check number)
- List of broker’s trust liability (sum of all deposits received, pending and being held by broker)
Brokerages must retain these items for an escrow accounts audit
- Monthly reconciliation statements
- Bank statements and cancelled checks
- Checkbooks, deposit books, and bank deposit receipts
- Ledger books or computer records for sale and property management records
- Pending sale contracts
- Voided contracts/offers with escrow funds presently being held
- Any earnest money deposit disputes
- Property management contracts, agreements and leases
Time for retaining escrow records
- Must maintain at least one legible copy (electronic is ok) of all books, accounts and other records related to the brokerage business for at least five years from the date entrusted to broker
3 actions investigators can take for violations
- Issue a notice of noncompliance
- Issue a citation
- Open a complaint
Notice of noncompliance
- Minor violations (one that doesn’t cause econ or physical harm
- Must specify statute or rule being violaged and give info on how to comply with that requirement within 15 days from the date the notice is received
- Citation issued if noncompliant after 15 day period
Notice of noncompliances examples
- Sales association or broker associate serving as officer/director of brokerage
- Failure to maintain the office entrance sign
- Failure to register a trade name
- Failure to sign the escrow account reconciliation if account balances
- Failure to adhere to team advertising requirements (1st violations)
Citations against broker
- No substantial threat to the public health/safety and welfare
- May be imposed upon licensee, registrat or permitholder
Citation examples
- Failure by a resident licensee to notify the FREC about becoming a nonresident
- Failure to maintain the required office or the required office signage
- Failure to register an out-of-state Florida broker’s office
- Failure to register a location as a branch office
- Failure to include the required information in a listing agreement
- Failure to give a listing agreement to a principal within 24 hours, including a self-renewal clause in a listing agreement
- Sales associate operating without a registered employer because of failure to renew or properly register
- Operating as a broker under a trade name that hasn’t been provided to the FREC for its records
- Failure to obtain a multiple permit
- Sales associate or broker associate serving as an officer/director of a registered brokerage corporation
- Failure to make sure the corporation/partnership is properly registered
- Failure to ensure that each officer, director, and sales associate is properly licensed
Complaint against broker
- DBPR reviews complaints submitted by consumers or confidential informants, or even anonymously
- DBPR has authority to open a complaint and initiate an investigation if it has reasonable cause to believe that licensee violated florida statute, DBPR rule, or Frec
Probable cause panel must have this many members
At least 2
The first step in investigating a potential violation of FL real estate law
Complaint filed with the DBPR
What step in the Florida compliance process comes after the probably cause proceedings but before hearing conducted?
Formal complaint is issued
Why might the DBPR issue an emergency suspension order against a licensee?
The licensee’s actions endangers the public welfare.
If a subject of a disciplinary complaint gives up his license instead of a hearing…
He can never reapply.
A Florida licensee has had a complaint filed against him. What is the next step in the process for handling this complaint?
An investigation occurs
When a complaint is filed against a real estate licensee in Florida, who or what entity is responsible for investigating the complaint?
The DBPR