Property Management
In Rhode Island, a property manager who embezzles funds from the managed property's escrow account can face:
AOnly a civil lawsuit from the property owner
BLicense revocation by the DBR, civil liability, and potential criminal prosecution for theft✓ Correct
COnly a fine from the DBR
DNo consequences if the amount was under $1,000
Explanation
Embezzlement of client funds is a serious crime and license law violation in Rhode Island. The property manager faces potential license revocation, civil liability to the owner, and criminal prosecution for theft/embezzlement.
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Key Terms to Know
Escrow
A neutral third-party arrangement where funds, documents, and instructions are held until all conditions of a real estate transaction are satisfied.
LienA financial claim against a property that serves as security for a debt or obligation, giving the creditor the right to foreclose if unpaid.
Earnest MoneyA deposit made by the buyer when submitting a purchase offer, demonstrating serious intent and serving as consideration for the contract.
ContingencyA condition in a purchase contract that must be satisfied before the sale can proceed to closing.
State-Specific Concepts
License Law
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