20 Ways to Meet the Commissioners (3).pptx

CE #5957001-RE LIVE Instruction
3 Hours of Law and Legislation
approved by the Nevada Real Estate Division on behalf of the Commission
© Copyright 2021, Real Estate School of Nevada. All rights reserved.

• We have identified some of the most relevant
laws and statutes from NRS and NAC 645
• Short, fictitious scenarios will be presented
where the licensee violates the law
• Additional questions will be asked such as what the
licensee could have done differently
• Actual cases that went before the Nevada real
estate Commissioners and the disciplinary
actions that were imposed
© Copyright 2021, Real Estate School of Nevada. All rights reserved. 2

NRS 645.050
1. The Real Estate Commission is hereby created. The
Commission consists of five members appointed by
the Governor.
2. The Commission shall act in an advisory capacity to
the Real Estate Division, adopt regulations and
conduct hearings as provided in this chapter. The
Commission shall adopt regulations establishing
standards for the operation of licensees’ offices and for
their business conduct and ethics.

NRS 645.090
1. Be a citizen of the United States.
2. Have been a resident of the State of Nevada for not
less than 5 years.
3. Have been actively engaged in business as:
a. A real estate broker within the State of Nevada for at least 3
years immediately preceding the date of appointment; or
b. A real estate broker-salesperson within the State of Nevada for
at least 5 years immediately preceding the date of
appointment.

• Scenario #1: “The Poker Dealer”
• Hank is a licensed Nevada salesperson with a friend,
Charlie, who deals poker at The Mirage. Because
Charlie meets a lot of out-of-state guests while
dealing cards, he often meets people who have a
desire to invest in Las Vegas real estate. Recently,
Charlie met a California investor who Charlie
referred to his real estate friend. The investor
purchased a $375,000 four-plex through Hank.
Being so appreciative, salesperson Hank sent a
thank you card along with a check for $500.00 to
Charlie who promptly deposited the check.
• What, if anything did Charlie do wrong?

• The Law(s):
• NRS 645.280
1. It is unlawful for any licensed real estate broker, or
broker-salesperson or salesperson to offer,
promise, allow, give or pay, directly or indirectly, any
part or share of his or her commission,
compensation or finder’s fee arising or accruing
from any real estate transaction to any person who
is not a licensed real estate broker, broker-
salesperson or salesperson, in consideration of
services performed or to be performed by the
unlicensed person.

• NRS 645.633 (c)
(c) Paying a commission, compensation or a finder’s
fee to any person for performing the services of a
broker, broker-salesperson or salesperson who has
not secured a license pursuant to this chapter.

• NRS 645.230
1. It is unlawful for any person, limited-liability
company, partnership, association or corporation to
engage in the business of, act in the capacity of,
advertise or assume to act as, a:
(a) Real estate broker, real estate broker-salesperson or
real estate salesperson within the State of
Nevada without first obtaining the appropriate
license from the Real Estate Division as provided
for in this chapter;
• Would there have been a better way to thank his
dealer friend?

• Scenario #2: “The Hot Listing”
• Don has a hot, new listing that has only been in the
MLS™ for two days. In those two days, the property
has already been shown five times including by Don
who has a buyer prospect, the Browns, for his own
listing. While waiting to hear back from the Browns of
their intentions to write an offer, Don receives an email
from salesperson Susan with an attached offer on the
listing. Don does nothing to act on Susan’s offer, and is
thrilled to hear two days later, that the Browns are ready
to submit an offer, which they do. Don promptly
presents the Browns’ offer to his sellers, who accept.
Agent Susan, after waiting…

• …and growing impatient, calls Don and inquires as
to the status of her offer. Don informs her that the
sellers accepted another offer.
• What, if anything did Don do wrong?

• The Law(s):
• NRS 645.254
4. Shall present all offers made to or by the client as
soon as is practicable, unless the client chooses to
waive the duty of the licensee to present all offers
and signs a waiver of the duty on a form prescribed
by the Division;
• NRS 645.635
8. Failure to submit all written bona fide offers to a
seller when the offers are received before the seller
accepts an offer in writing and until the broker has
knowledge of that acceptance

• NAC 645.632
1. If a licensee represents a seller in a transaction, and
if the seller does not accept an offer within a
reasonable time after an offer has been presented to
the seller, the licensee shall provide to the buyer, or
the representative of the buyer written notice signed
by the seller which informs the buyer that the offer
has not been accepted by the seller.
2. If a licensee represents a buyer in a transaction, and
if the buyer does not accept a counteroffer within a
reasonable time …
• How should Don have handled this?

• Scenario #3: “A Token of Appreciation”
• Sally, a Nevada broker-salesperson, is seated at the
closing table with her seller clients, the Ortegas, as they
are wrapping up the signing. Mr. and Mrs. Ortega
express their appreciation to Sally for a quick sale that
resulted in a higher selling price than they expected.
Mrs. Ortega tears a check from her checkbook, payable
to Sally for $1,000 and says, “This is for you Sally. Do
something special with your family – our treat – since
you did such a fabulous job in selling our home.” With
great appreciation, Sally accepts the check.
• What, if anything did Sally do wrong?

• The Law(s):
• NRS 645.630 1(c)
(c) Accepting a commission or valuable consideration
as a real estate broker-salesperson or salesperson
for the performance of any of the acts specified in
this chapter or chapter 119 or 119A of NRS from any
person except the licensed real estate broker with
whom he or she is associated or the owner-
developer by whom he or she is employed.
• Could Sally have handled this differently and
perhaps even still received the bonus?

• Scenario #4: “In a Pinch”
• Broker Tom realized it is the first of the month and the
rent for his office is due. He is hoping that the Greens
keep their 11:00 appointment to write an offer on a
house he showed them yesterday. Indeed, the Greens
do come in at eleven, write the offer, and submit an
earnest money deposit in the amount of $5,000. After
the Greens leave, Tom heads straight to the bank and
deposits their check in his operating account. Upon
returning to the office, Broker Tom writes a check
against the operating account to pay the landlord.
• What, if anything did Broker Tom do wrong?

• The Law(s):
• NRS 645.630 1(h)
(h) Commingling the money or other property of his or
her clients with his or her own or converting the
money of others to his or her own use.
• NRS 645.310
3. A real estate broker shall not commingle the money
or other property of a client with his or her own.
• What disciplinary action(s) could the
Commissioners impose on Broker Tom?

• Scenario #5: “Get Rich Quick?”
• REALTOR® Jenny and her husband, a licensed
appraiser, purchase a home for $300,000. The
couple comes up with a plan to alter the contract
by raising the purchase price $25,000 before
delivering a copy of the contract to the loan officer.
They represent to the lender that the purchase
price is $325,000, and the appraiser husband
supports the $325,000 in his appraisal. Upon
closing, the two pocket the additional $25,000.
• What, if anything Jenny do wrong?

• The Law(s):
• NRS 645.635
5. Representing to any lender, guaranteeing agency
or any other interested party, verbally or through
the preparation of false documents, an amount in
excess of the actual sale price of the real estate or
terms differing from those agreed upon.
10. Knowingly submitting any false or fraudulent
appraisal to any financial institution or other
interested person.

• NAC 645.605
Considerations in determining certain misconduct
by licensee. In determining whether a licensee has
been guilty of gross negligence or incompetence…
the Commission will consider…whether the
licensee:
1. Has done his or her utmost to protect the public
against fraud, misrepresentation or unethical
practices related to real estate or time shares.
• What disciplinary action(s) could the
Commissioners impose on Jenny?

• Scenario #6: “The Walk Through”
• Mr. and Mrs. Jenkins are conducting a walk-through
inspection along with their real estate agent. The listing
agent, Joe, and the seller are observing and talking in the
kitchen. It is the middle of August, and the temperature
outside has reached a scorching 115 degrees. The seller
notices the agent was fiddling with the thermostat halfway
down the hall, and the group has now proceeded into one
of the bedrooms. Somewhat relieved, the seller turns to
listing agent Joe and says, “Don’t say anything, but the
heater doesn’t work. I just got an estimate of $1,500 and
decided not to fix it since we are closing this week.”
• What should Joe do in the present situation?

• The Law(s):
• NRS 645.252
A licensee:
1. Shall disclose to each party to the real estate
transaction as soon as is practicable:
(a) Any material and relevant facts, data or information
which the licensee knows, or which by the exercise
of reasonable care and diligence should have
known, relating to the property which is the subject
of the transaction.

• NRS 645.254
5. Shall disclose to the client material facts of which the
licensee has knowledge concerning the transaction;
• NAC 645.605
10. Has acquired knowledge of all material facts that
are reasonably ascertainable and are of customary
or express concern and has conveyed that
knowledge to the parties to the real estate
transaction.
• How should listing agent Joe respond to his
seller’s request?

• Scenario #7: “The Deposit”
• It is Friday night, and salesperson George is in the
conference room writing an offer with the Bergs.
Upon finishing the offer, the Bergs give George a
check in the amount of $3,000 payable to the
brokerage firm and representing the earnest money
deposit. Upon their departure, George emails the
offer to the listing agent. Saturday morning, George
receives an email from the listing agent with a
counteroffer. The Bergs inform George they would
like to think about the counteroffer before making a
final decision. Monday afternoon, George receives
an email from the buyers accepting the sellers’ . . .

• . . . counter. George promptly calls the listing
agent, notifying her of the buyers’ acceptance of the
counteroffer and that he will proceed with opening
escrow. George opens escrow Wednesday
morning. He also gives the earnest money check to
his broker. Friday, the broker asks his office
administrator to deposit the check in the firm’s trust
account.
• On what day did the offer become a contract?
• What, if anything, did George do wrong?
• What, if anything, did George’s broker do
wrong?

• The Law(s):
• NAC 645.657
• A licensee who receives a deposit on any transaction
in which he or she is engaged on behalf of a broker
or owner-developer shall pay over the deposit to that
broker or owner-developer, or to the escrow
business or company designated in the contract,
within 1 business day after receiving a fully executed
contract.

• NRS 645.630
(k) Upon acceptance of an agreement, in the case of a
broker, failing to deposit any check or cash received
as earnest money before the end of the next
banking day unless otherwise provided in the
purchase agreement.
• What might be a better way to handle the earnest
money deposit?

• Scenario #8: “I hate my Broker!”
• Salesperson Amy has become disenchanted with her
broker and decides to terminate the relationship and
join another firm. After meeting with her initial
broker, she leaves the firm with her termination form
(which includes the broker’s consent to hand carry
her license) and her real estate license in hand. The
broker refused to allow her to take her active listings
or pending escrows. Over the next several days,
Amy makes a series of calls to “her clients” informing
them of her decision to leave the firm while seeking
to solicit them to keep their business with her,
although she has not yet chosen another firm...

• … She also continues to follow up on the pending
escrows in an attempt to get them successfully
closed. As well, she made a listing presentation to a
new seller prospect. After six weeks, Amy affiliates
with another firm and submits the appropriate
paperwork to the Division.
• What, if anything, did Amy do wrong?
• What, if anything, did Amy’s broker do wrong?

• The Law(s):
• NRS 645.580
2. A broker-salesperson or salesperson must, within 30
days after termination of that association, become
associated with or employed by another broker or
owner-developer or request that the license be
placed on inactive status.

3. It is unlawful for any real estate salesperson to
perform any of the acts contemplated by this
chapter, either directly or indirectly, under authority
of the license on or after the date of receipt of the
license from the broker or owner-developer by the
Division and until the license is transferred or
reissued or a new license is issued.
• Did Amy have the right to solicit her seller clients
or continue to follow up with the clients in
escrow?

• Scenario #9: “The New Home Sale”
• Lisa is a Nevada licensee showing new homes to
her buyer clients, the Jacksons. As they stand in
the kitchen of the model home, Lisa comments, “If
you guys buy now while the builder is only in Phase
1, by the time they complete Phase 4, you will have
gained substantial equity. I think you should write
the offer today – you can’t lose!”
• What, if anything did Lisa do wrong?

• The Law(s):
• NRS 645.633
1(b) Making any false promises of a character likely to
influence, persuade or induce.
1(e) Guaranteeing, or having authorized or permitted
any person to guarantee, future profits which may
result from the resale of real property.
• Lisa never used the term “guarantee,” so would
it really be a violation of NRS 645.633 1(e)?

• Scenario #10: “The Home Warranty”
• Lorraine is in escrow to purchase her very first home.
She asks her agent, Clarence, some questions about
home warranties, including which one he
recommends. He comments, “I think Home Warranty
of America is the best – I recommend them to all my
clients.” Lorraine inquires as to the price of the
warranty through that company and if the pool/spa
will also be covered. Clarence assures her of
coverage for the pool and spa and indicates the
policy will only cost her $495.00 a year. Lorraine
requests that Clarence arrange for the coverage, and
he does so…

• … At closing, Lorraine notices the cost on the
Closing Disclosure is $745.00. Further, after
contacting Home Warranty of America, she is
informed the pool and spa are not covered.
• What, if anything did Clarence do wrong?

• The Law(s):
• NRS 645.630 1(a)
(a) Making any material misrepresentation.
• NRS 645.645
1. Makes a misrepresentation in the sale of insurance
for home protection.
2. Misrepresents the provisions of the contract of
insurance for home protection.
3. Misappropriates any fees or premiums collected for
the insurance for home protection.

• NRS 645.254
6. Shall advise the client to obtain advice from an
expert relating to matters which are beyond the
expertise of the licensee;

• NRS 645.630
• NRS 645.633
• NRS 645.635
• NRS 645.990

• NEVADA REAL ESTATE DIVISION
• “Open House” Newsletter
• Case #1: “Carine” (September 2016)
• Violated NRS 645.252(1)(b) on five occasions by not
disclosing to each party as soon as practicable each
source from which she received compensation as a
result of a real estate transaction. Also, violated NRS
645.630(1)(b) on five occasions by making false
promises of a character likely to influence, persuade or
induce, and violated NRS 645.633(1)(h) on five
occasions by not disclosing her interest in and
compensation from a company that allegedly made
repairs.

• NRS 645.252 - Duties of licensee acting as
agent in real estate transaction.
A licensee who acts as an agent in a real
estate transaction:
1. Shall disclose to each party to the real estate
transaction as soon as is practicable:
(b) Each source from which the licensee will receive
compensation as a result of the transaction.
• NRS 645.630
(b) Making any false promises of a character likely to
influence, persuade or induce.

• NRS 645.633
1. The Commission may take action pursuant to
NRS 645.630 against any person subject to that
section who is guilty of any of the following acts:
(h) Gross negligence or incompetence in performing any
act for which the person is required to hold a
license pursuant to this chapter, chapter 119,
119A or 119B of NRS.
• $5,000 fine. Salesperson license revoked.

• Case #2: “Rex” (September 2016)
• Commingled the money of his clients with his own or
converted the money of others to his own use, violating
NRS 645.630(1)(h) on 18 occasions. Additionally, failed
to notify the Division of the names of the banks in which
he maintained trust accounts; impeded or attempted to
impede the Division investigation by supplying false
information; failed to promptly deposit money in a
separate checking account (located in a bank or credit
union in this state) that was designated as a trust
account; maintained a custodial or trust account from
which money could be withdrawn without the signature
of…

• a licensee; failed to do his utmost to protect the
public against fraud, misrepresentation or unethical
practices related to real estate; failed to comply with
a request by the Division to provide documents
and/or a written response and failed to timely file an
appeal.
• NRS 645.630(1)(h)
• $252,500 fine. Real estate licenses and property
manager permit revoked.

• Case #3: “Catherine” (June 2016)
• Committed 18 violations of NRS 645.252(2) by
allowing her clients’ trust accounts to become
overdrawn resulting in bank fees being charged
against owner funds. Committed 8 violations of NRS
645.630(1)(f) by failing to account for and/or remit
client funds within a reasonable time. Committed 39
violations of NRS 645.630(1)(h) by comingling and or
converting client trust account funds with her own,
using client funds for office expenses, personal
medical bills and cash withdrawals.

• NRS 645.252
2. Shall exercise reasonable skill and care with respect
to all parties to the real estate transaction.
• NRS 645.630
(f) Failing, within a reasonable time, to account for or to
remit any money which comes into his or her
possession and which belongs to others.
• $14,000 fine. Real estate license and property
management permit revoked.

• Case #4: “Artur” (September 2016)
• Misrepresented himself in a property management
agreement and residential lease agreement as a
broker when he was not licensed as a broker, a
violation of NRS 645.630(1)(a). Also, violated NRS
654.633(1)(i) by having his broker’s signature forged
upon real estate transaction documents.
• NRS 645.630
(a) Making any material misrepresentation.
• NRS 645.633
(i) Any other conduct which constitutes deceitful,
fraudulent or dishonest dealing.

• $12,000 fine. Agency: 6 hours Ethics: 6 hours

• Case #5: “Krystin” (June 2016)
• Engaged in real estate broker activities and property
management activities without a broker’s license or an
active permit. Advertised under a name that she was not
licensed under and that was not registered with the
Division. Violated NAC 645.610(1)(b)(2)(c) 35 times by
entering personally or through others into property
management agreements and residential lease
agreements in the name of the unregistered entity.
Violated NRS 645.630(1)(a) 17 times by misrepresenting
that she was the broker for properties on contracts.
Converted client’s money for her own use, failed to remit
monies to property, …

• …failed to account for the money due to
homeowners, conducted unlicensed activity following
the inactivation of her license and permit, and failed
to respond to the allegations in the complaint and
provide information regarding the properties.
• NAC 645.610 - Restrictions on advertising;
use of name under which licensee is licensed.
(NRS 645.050, 645.190)
1. In addition to satisfying the requirements set forth in
NRS 645.315:

(b) Except as otherwise provided in this paragraph, a
licensee shall not use his or her name or
telephone number or the name or telephone
number of another licensee of the brokerage firm
with which the licensee is associated in any
advertisement which contains the words “for sale
by owner,” “for lease by owner” or similar words. A
licensee may use his or her name or telephone
number in an advertisement for property if the
licensee has an ownership interest in the
advertised property

(c) The name of a brokerage firm under which a real
estate broker does business or with which a real
estate broker-salesperson or salesperson is
associated must be clearly identified with
prominence in any advertisement. In determining
whether the name of the brokerage firm is
identified with prominence, the Division shall
consider, without limitation, the style, size and
color of the type or font used and the location of
the name of the brokerage firm as it appears in
the advertisement.
• $500,000 fine. Salesperson license and property
management permit revoked.

• Case #6: “Matthew” (February 2016)
• Entered a property for an unauthorized purpose
unrelated to a real estate transaction and engaged in
sexual activity.
• $10,000 fine Salesperson license revoked.

• Case #7: “Dale” (April 2016)
• Convinced owners to sell a $372,000 condo to his
cousin for $137,800 with the agreement they could buy
it back for the purchase price plus $10,000 in six
months. After the transaction was complete, he had no
further contact with the former owners. Respondent
violated NRS 645.633(1)(i) for facilitating the agreement
and breaching his obligation of absolute fidelity.
Additionally, he failed to: disclose his relationship with
buyer in writing; provide paperwork for the transaction
to his broker; and produce documents and a written
response to the Division.

• NRS 645.633
• (i) Any other conduct which constitutes deceitful,
fraudulent or dishonest dealing.
• $60,000 fine Salesperson license revoked.

• Case #8: “Susanne” (December 2015)
• Forged continuing education certificates and a
broker's signature on an application for
reinstatement. Failed to supply a written response to
the Division.
• Salesperson license revoked. $30,000 fine

• Case #9: “Elana” (February 2016)
• Failed to deposit client money into the trust account
on 29 occasions. On two occasions comingled client
money with her own or converted the money of
others to her own use. Additionally, failed to do her
utmost to protect the public against fraud,
misrepresentation or unethical practices related to
real estate, and failed to supply a written response to
the Division.
• Salesperson license and property management
permit revoked. $340,000 fine

• Case #10: “Richard” (January 2015)
• While on a maintenance call for an apartment,
respondent violated NRS 645.633(1)(i), engaging in
deceitful behavior by asking to remove his clothes
without clarifying that it was his intention to remove
all his clothing including his underwear.
• Voluntary surrender of salesperson license in
lieu of disciplinary action. May not apply for any
real estate license in Nevada for five years.

1. How many brokers or broker-salespersons
serve on the Commission?
A. 3
B. 5
C. 7
D. 9

2. Salesperson Sam has a poker dealer friend
who works at a local casino. Upon making a
referral that resulted in a closing, Sam may
compensate the poker dealer with:
A. $500.
B. A new set of golf clubs.
C. A $20 gift card to the Olive Garden.
D. A thank you card.

3. Which of the following is TRUE regarding
the presentation of offers?
A. All offers must be presented as soon as is practicable.
B. All written bona fide offers must be presented to a seller
when the offers are received before the seller accepts an
offer in writing.
C. If an offer is rejected, written notice must be delivered to
the offeror of the rejection.
D. All the above

4. A Nevada real estate salesperson may be
compensated for performing real estate
services by:
A. The client.
B. Another salesperson.
C. A cooperating broker.
D. The employing broker.

5. The best term to describe Broker Franklin’s
deposit of an earnest money deposit into his
operating account would be:
A. Commingling.
B. Conversion.
C. Fraud.
D. Reconciliation.

6. For each violation of the licensing law, the
Commission may impose an administrative
fine for up to:
A. $500.
B. $5,000.
C. $10,000.
D. $25,000.

7. In addition to sanctioning an administrative
fine, the Commission may also take what
disciplinary action against a licensee?
A. Revocation
B. Suspension
C. Place conditions upon license
D. All the above

8. A licensee who has knowledge of a material
fact, must:
A. Disclose the material fact to his client only.
B. Disclose the material fact to all parties in the transaction.
C. Disclose the material fact on the SRPD.
D. None of the above

9. A salesperson who accepts an earnest
money deposit on behalf of her broker, must
turn that deposit over to her broker:
A. Within one business day.
B. Within one business day of acceptance.
C. Upon the opening of escrow.
D. Immediately upon receipt of the funds.

10. An alternative to the broker retaining
earnest money funds is:
A. Have the buyer make the check payable to the title company.
B. Make the offer contingent upon the buyer wiring earnest money
funds to escrow upon acceptance.
C. Not require an earnest money deposit.
D. All the above

20 Ways to Meet the Commissioners (3).pptx

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