Trust Funds
Under California law, a DRE auditor examining a broker's trust fund records has the right to inspect those records:
AOnly with a court subpoena
BOnly during business hours with 48 hours' notice
CAt any time, with or without prior notice✓ Correct
DOnly if a complaint has been filed against the broker
Explanation
The DRE has the authority to audit a broker's trust fund accounts and records at any reasonable time without prior notice. This is part of the DRE's duty to protect the public and maintain integrity in real estate transactions.
Related California Trust Funds Questions
- A broker receives a $10,000 earnest money deposit in cash from a buyer. The broker must:
- A DRE audit of a broker's trust account reveals that the balance of individual client ledgers is less than the total bank balance. This condition is called:
- What is 'conversion' of trust funds?
- A broker must maintain a separate trust account ledger for each:
- What is a 'neutral escrow' and when is it used for trust funds?
- A broker receives a check as earnest money. Under California law, the broker must deposit it into the trust account within:
- What records must a California broker maintain for their trust account?
- If a buyer instructs the broker to hold their uncashed check until offer acceptance, the broker should:
Practice More California Real Estate Questions
1,500+ questions covering all exam topics. Start free — no signup required.
Take the Free California Quiz →