Broker Management and Supervision (Broker Only)
Broker-management topics appear only on the broker exam and cover running a firm and supervising associates. This chapter covers supervision, place of business, and cessation, death, or disability of a broker.
Supervision and Place of Business
A broker must reasonably supervise the licensed activities of affiliated sales and broker associates, including their advertising, disclosures, and handling of funds delivered to the broker, and must maintain a proper place of business. Failure to supervise can subject the broker to discipline even when an associate committed the underlying violation.
Cessation, Death, or Disability
The License Code addresses what happens when a broker ceases business or the broker dies or becomes disabled, providing for orderly handling of the firm's licenses, associate affiliations, records, and trust funds, with notice to OREC. Affiliated associates generally must associate with another broker to keep practicing, and client trust funds remain protected.
Accountability
A broker's supervisory duty cannot be delegated away in a way that eliminates accountability. The broker remains responsible for the firm's compliance with the License Code, for the trust account, and for the conduct of associates acting under the firm's authority.