DRE & Licensing
A real estate licensee in California is found to have commingled client funds with their personal bank account. This violates:
AOnly federal banking regulations
BCalifornia Business and Professions Code provisions on trust fund handling✓ Correct
COnly the NAR Code of Ethics
DNo law — commingling is allowed if disclosed to the client
Explanation
Commingling — mixing client trust funds with the broker's personal or business funds — is strictly prohibited under California Business and Professions Code Section 10176(e). Violations can result in license suspension or revocation. Related violations include conversion (using client funds for personal purposes), which is also illegal and potentially criminal.
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