Agency
A Texas real estate agent who has been representing a buyer learns that the buyer is planning to commit mortgage fraud by misrepresenting their income to obtain a loan. The agent must:
AKeep this information confidential as the buyer's agent
BRefuse to participate in the fraud and withdraw from the representation✓ Correct
CReport the buyer to the FBI before taking any other action
DNotify the seller so they can protect themselves
Explanation
An agent cannot participate in or facilitate fraud. Mortgage fraud is a federal crime. The agent must refuse to participate and should withdraw from the representation. While reporting to law enforcement is an option, the immediate obligation is to not participate in the fraud and to withdraw from the representation.
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