Question

Which of the following statements concerning requirements of an Oregon principal broker's clients' trust account is FALSE?

a) Interest earned on the trust account belongs to the principal broker.
b) Trust account records must be maintained for a minimum of 6 years.
c) A separate trust account is required for each client.
d) The account must be an interest-bearing account.

Answer 1

The false statement is that the interest earned on a clients' trust account belongs to the principal broker. In Oregon, this interest does not belong to the broker and there is no requirement for separate trust accounts for each client.

Step-by-step explanation:

The correct answer to the question is a) Interest earned on the trust account belongs to the principal broker. In Oregon real estate practices, the interest earned on a clients' trust account typically does not belong to the principal broker but is rather either paid to the client or to the State's Affordable Housing Fund in accordance with statutory requirements.

Trust accounts do need to be interest-bearing per certain conditions, and records for these accounts must indeed be maintained for a minimum of six years. However, it is not required to have a separate trust account for each client; instead, a principal broker can maintain a pooled trust account with proper record-keeping.