Delaware License Law
What is 'conversion' of client funds under Delaware real estate law?
AConverting a residential property to commercial use
BThe illegal use of client escrow or trust funds by the broker for the broker's own purposes — distinct from commingling and considered more serious✓ Correct
CConverting a lease agreement to a purchase contract
DThe process of converting a cooperative to a condominium
Explanation
Conversion is the unauthorized taking or use of client funds — using escrow or trust funds for personal or business expenses. It is distinct from (and more serious than) commingling. Conversion is considered theft and can result in criminal prosecution in addition to license revocation. Brokers must maintain meticulous escrow records.
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