1 Illinois Department of Financial & Professional Regulation, Division of Real Estate Real Estate Administration and Disciplinary Board OPEN Minutes Date: December 12, 2019 Call to Order: 9:32 a.m. –Jeremy Reed – Acting Chairperson Location: IDFPR – Division of Real Estate 100 W Randolph, 9 th Floor, Room 258 Chicago, IL 60601 And Via Interactive Video Conference at IDFPR 320 W. Washington, 2 nd Floor, Room 258 Springfield, IL 62786 Board Member(s) Present: Loretta Alonzo-Deubel, Joe Castillo, Laura Ellis, Carol Meinhart, Michael Oldenettel, Tammy Owens, Gabriela Roman, Norm Willoughby, Everett Ward Board Member(s) Absent: Denise Akason, Dennis Hiffman, David Maloof, Nykea Pippion- McGriff, Michael Prodehl Division Staff Present: Gabriela Nicolau – Deputy General Counsel, Adrienne Levatino – Associate General Counsel, Ericka Johnson – Chief of Prosecutions, Hector Rodriguez – Chief of Audits and Investigations, Donielle Philpott – Policy Manager, Sarah Trine – Industry Liaison, Susan Sigourney – Board Liaison, Debra Malinowski - Board Liaison Guest(s) Present: Larry Toban – Real Estate Institute, Mike Fair – Your House Academy, Rocky Esposito- AHI Real Estate, Kate Sax – Mainstreet Organization of Realtors, Kirk Antkiewicz -Chicago Association of Realtors, Stephanie Eder – Baird and Warner; Young Brockhouse Illinois Realtors Licensing and Education, Craig Capilla – Attorney, Edward Williams - Attorney Illinois Department of Financial and Professional Regulation Division of Real Estate JB PRITZKER Governor DEBORAH HAGAN Secretary MARIO TRETO JR. Acting Director Division of Real Estate
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Illinois Department of Financial and Professional Regulation...Michael Oldenettel, yes . Tammy Owens, yes . Gabriela Roman, yes . Everett Ward, yes . Norm Willoughby, yes . A motion
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Illinois Department of Financial & Professional Regulation, Division of Real Estate Real Estate Administration and Disciplinary Board
OPEN Minutes Date: December 12, 2019 Call to Order: 9:32 a.m. –Jeremy Reed – Acting Chairperson Location: IDFPR – Division of Real Estate
100 W Randolph, 9th Floor, Room 258 Chicago, IL 60601 And Via Interactive Video Conference at IDFPR 320 W. Washington, 2nd Floor, Room 258 Springfield, IL 62786
Board Member(s) Present: Loretta Alonzo-Deubel, Joe Castillo, Laura Ellis, Carol Meinhart,
Michael Oldenettel, Tammy Owens, Gabriela Roman, Norm Willoughby, Everett Ward
Board Member(s) Absent: Denise Akason, Dennis Hiffman, David Maloof, Nykea Pippion-
McGriff, Michael Prodehl Division Staff Present: Gabriela Nicolau – Deputy General Counsel, Adrienne Levatino –
Associate General Counsel, Ericka Johnson – Chief of Prosecutions, Hector Rodriguez – Chief of Audits and Investigations, Donielle Philpott – Policy Manager, Sarah Trine – Industry Liaison, Susan Sigourney – Board Liaison, Debra Malinowski - Board Liaison
Guest(s) Present: Larry Toban – Real Estate Institute, Mike Fair – Your House
Academy, Rocky Esposito- AHI Real Estate, Kate Sax – Mainstreet Organization of Realtors, Kirk Antkiewicz -Chicago Association of Realtors, Stephanie Eder – Baird and Warner; Young Brockhouse Illinois Realtors Licensing and Education, Craig Capilla – Attorney, Edward Williams - Attorney
Illinois Department of Financial and Professional Regulation Division of Real Estate
JB PRITZKER Governor
DEBORAH HAGAN Secretary
MARIO TRETO JR. Acting Director
Division of Real Estate
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Topic Discussion Action Call to Order Acting Chairperson Jeremy Reed opened the meeting. The meeting was
called to order at 9:32 am.
Chairperson Laurie Murphy
Mr. Reed read a letter written by Chairperson Murphy who was unable to attend the READ Board meeting. Chairperson Murphy congratulated Norm Willoughby on being reappointed; and introduced and congratulated the newest board member, Loretta Alonzo-Deubel for being appointed to the READ Board. She thanked Mr. Reed for filling in as Acting Chairperson.
Approval of Open Minutes
The Board reviewed the Open Minutes from the November 14, 2019 Real Estate Administration and Disciplinary Board meeting.
Motion made by Ward noting a typo, seconded by Ellis to approve the Open Minutes with the correction of the typo. Motion carried.
Public Comments The Guests introduced themselves. There were no public comments
Licensing Report
The 2019 Licensing Report for activity conducted in November was presented and discussed. A copy of the report is attached to and made a part of these minutes. Mr. Reed mentioned that the supervision function of the online portal which previously had technical problems not uploading the information to the Department’s database is now posting the data the following day. The goal is to have this information posted immediately. The Department is still addressing all automated notifications from the online portal system to a licensee. There were additional comments made regarding this topic. Mr. Reed mentioned that the new Broker exam is live and being offered to candidates. Next month, the Licensing Report will show the statistics of the pass rate for the new Broker exam.
Education Report The 2019 Education Report through the month of November was presented and distributed. A copy of the report is attached to and made a part of these minutes.
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Topic Discussion Action Complaints Report The 2019 Complaints Report through the month of
November was presented and distributed. A copy of the report is attached to and made a part of these minutes.
Audits Reports
The 2019 Audits Report for activity conducted in November was presented and distributed. A copy of the report is attached to and made a part of these minutes.
Investigations Report The 2019 Investigations Report through the month of November was presented and distributed. A copy of the report is attached to and made a part of these minutes. Mr. Rodriguez mentioned that three investigators have left the Division and we are working on replacing them. One of the investigator positions have been filled and the investigator will start December 16, 2019 in the Springfield Office. There were interviews conducted for the investigator positions in the Chicago office and that position should be filled soon.
Prosecutions Report The 2019 Prosecutions Report through the month of November was presented and distributed. A copy of the report is attached to and made a part of these minutes. Prosecutions received 249 cases from the 2019 Managing Broker renewal continuing education audit. There were additional comments regarding this topic.
Real Estate Recovery Fund Report
The Real Estate Recovery Fund Report for the 2020 Fiscal Year through November 2019 was presented and distributed. A copy of the report is attached to and made a part of these minutes.
Formal Hearing Schedule Guests and Board Members received a schedule of the upcoming formal hearings.
Old Business
Last month the Board received the following curriculums: a draft Residential Leasing Agent 8 hour continuing education curriculum, a draft 75-Hour Pre-License curriculum, and two draft versions of the 45-Hour Post-License curriculums to review and have open discussions at today’s meeting. Mr. Reed read comments from Board Members that were unable to attend this meeting. Mr. Reed explained the options that the Board has for proceeding with the three different curriculums. The Board gave unanimous consensus to accept the draft Residential Leasing Agent 8-hour Continuing Education curriculum as presented. There were additional comments made regarding how the Division will handle the transition of the current
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Topic Discussion Action Residential Leasing Agent 6-hour Continuing Education curriculum to the new Residential Leasing Agent 8-hour Continuing Education curriculum. The Board had a discussion on the timeline the Division expects to have all three curriculums available for licensure and the order in which the curriculums should be reviewed and published. The Board had a lengthy discussion regarding the draft 75-hour Pre-License curriculum. Eight of the nine board members gave consensus to accept the draft 75-hour Pre-License curriculum as presented and to be effective March 1, 2020. One board member abstained. The Board discussed the two options that were presented to them regarding the 45-hour post license curriculums consisting of three 15-hour topics which were: Applied Brokerage Principles, Risk Management/Discipline, and Transactions Issues. The Board had a consensus to accept “Option 1” as presented. The Board discussed and commented on the timeline for when the 45-hour Post-License curriculum should be available to the industry. The Board recommends the Director extend the April 30, 2020 deadline for completing the 45-hour Post-License education to Brokers that are required to complete this course for the 2020 renewal. The Board suggested that when the curriculums are ready for publication to have guidelines on our website for the transition from the current to new curriculums.
New Business
There was no New Business discussed.
Motion to go into Closed Session
Roll Call Vote: Loretta Alonzo-Deubel, yes Joe Castillo, yes Laura Ellis, yes Carol Meinhart, yes Michael Oldenettel, yes Tammy Owens, yes Gabriela Roman, yes Everett Ward, yes Norm Willoughby, yes
A motion made by Willoughby seconded by Oldenettel to go into Closed Session for purposes of reviewing Closed Minutes and for deliberations pursuant to Section 2 (c) (4) and (15) of the Open Meetings Act at 11:01 a.m. Motion carried by roll call vote.
Closed Session
The November 14, 2019 closed minutes were reviewed by the Board.
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Topic Discussion Action The Board reviewed the Consumer Complaints Review and Case File Review Committee’s reports for: November 20, 2019 7 Cases Recommended for Closure by Investigations 4 Cases Referred to Prosecutions by Investigations 18 Cases for Closure by Prosecutions 4 Complaints Referred to Investigations 1 Complaints Recommended for Closure December 4, 2019 6 Cases Recommended for Closure by Investigations 7 Cases Referred to Prosecutions by Investigations 0 Cases for Closure by Prosecutions 10 Complaints Referred to Investigations 2 Complaint Recommended for Closure The Board deliberated on pending enforcement actions.
Motion to go into Open Session Approval of November 14, 2019 Closed Minutes
A motion made by Ward, seconded by Alonzo-Deubel to go into Open Session at 12:40 a.m. Motion carried. Motion made by Oldenettel, seconded by Ward to approve the November 14, 2019 Closed Minutes. Motion carried. Motion made by Owens, seconded by Meinhart to approve the Board’s recommendations in Closed Session. Motion carried.
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Topic Discussion Action Recommendations The Board signed 3 Findings of Facts, Conclusions of Law and Recommendations to the Director
4 Cases were deliberated during Closed Session. IDFPR v. Mike Skerlak Case #2019-04170 IDFPR v. Donald Higgins / Higgins Outdoor Inc. Case #2016-08556 IDFPR v. Erik Kikke Case #2018-01116 IDFPR v. Eldred Nehmelman Case #2019-07849
The Board does not accept the recommendation of the Administrative Law Judge but recommends denying the application for licensure. The Board recommends cease and desist for both respondents, and to impose a $50,000 civil penalty jointly and severally, upon Donald Higgins and Higgins Outdoor Inc. The Board recommends an indefinite suspension for a minimum period of 6 months, and to impose a $1,000.00 fine, upon the license of Erik Kikke. The Board recommends cease and desist, and to impose a $75,000 civil penalty, upon Eldred Nehmelman. IDFPR v. Donald Higgins / Higgins Outdoor Inc. #2016-08556 IDFPR v. Erik Kikke #2018-01116
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Topic Discussion Action Orders
16 Consent Orders and Non-Disciplinary Orders were reviewed and discussed in Closed Session. The Board received a report of the final actions by the Director on the following 8 Consent Orders previously signed by the Board:
See Wong 2016-09768 Ryan Smith 2017-12300 Scott Foster 2018-08814 Kasra Motlagh 2018-11684 Austin Tanner 2018-11846 Jennifer Corcio McFarlane 2019-00236 Robert Picciariello Jr 2017-05979 Ream Masoud 2017-06619
IDFPR v. Eldred Nehmelman #2019-07849 The Board signed 3 recommendations. Motion made by Owens seconded by Meinhart to ratify the actions of Consumer Complaint Review (CCR) and Case File Review Committee (CRC). Motion carried. The Board signed 13 Consent Orders and Non-Disciplinary Orders.
Adjournment Next meeting scheduled for January 9, 2020 in Chicago and via Interactive Video Conference in Springfield.
There being no further business to discuss motion made by Owens, seconded by Castillo to adjourn at 12:45 p.m. Motion carried.
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PROFESSION SPONSOR CHG. INITIAL LIC. RENEWALS ACTIVERE Managing Broker 81 37 21 15,493 Residential Leasing Agent 24 48 3 3,585 Real Estate Broker 615 316 22 54,967 RE Branch Office 14 20 1 1,254 Real Estate Broker Corporation 5 5 3 3,584 Real Estate Broker Partnership 0 0 0 31 RE Limited Liability Firm 3 17 0 1,937 RE Education Provider (new) 0 0 0 56 RE Pre-Lic Instructor 0 5 1 241 RE Pre-Lic Course 0 1 0 335 RE CE Instructor 0 3 2 286 Real Estate CE Course 0 23 0 489 TOTAL 742 475 53 82,258
DRE Education's Issued Licenses DRE Education's Pipeline
Diane GreenNate Chandler Jeremy Reed
December 2019Complaint Report
Column1 New RE Complaints
New RE Complaints Assigned To
Investigations Complaints Closed At
Intake ReviewRE Matters Closed
At CCR
January 33 25 5 3
February 36 21 6 9
March 38 23 9 6
April 50 31 9 10
May 51 31 12 8
June 42 23 16 3
July 32 19 7 6
August 51 30 12 9
September 37 22 10 5
October 42 16 18 8
November 21 14 4 3
December 25 14 6 5
Total 458 269 114 75
MONTHLY AUDIT REPORT
READ Board – January 9, 2020
Licensees that have not yet had an audit in the Chicago Area region are continuing to be assigned to the non-Chicago Area Region examiners. In the effort to accelerate the number of audits to be conducted, Brokerage Verification Reports are being mailed to these licensees. This report allows the examiner to assess the level of activity of the licensee then complete the audit process by mail or schedule an on-site audit. From the total number of first audits closed in December, 28 files were in this region. FIRST AUDITS COMPLETED
RESOLUTION TYPE: BROKERAGE VERIFICATION REPORT – NOT PRACTICING TOTAL COMPLETED: 2
An audit conducted by mail and the licensee has not performed licensed real estate activity within the past three years. RESOLUTION TYPE: BROKERAGE VERIFICATION REPORT – PRACTICING TOTAL COMPLETED: 11
An audit conducted by mail and the licensee has performed licensed real estate activity within the past three years. RESOLUTION TYPE: INSPECTED – NOT PRACTICING TOTAL COMPLETED: 0
An on-site audit has been conducted and the licensee has not performed licensed real estate activity within the past three years. RESOLUTION TYPE: INSPECTED – PRACTICING TOTAL COMPLETED: 14
An on-site audit has been conducted and the licensee has performed licensed real estate activity within the past three years. RESOLUTION TYPE: NOT INSPECTED TOTAL CLOSED: 3
This category is comprised of licensees not requiring an audit. This includes licensees that are out-of-state residents, deceased licensees, companies that are out of business (or license status has become “inactive”), or change of sponsorship. RESOLUTION TYPE: REFERRED TO SUPERVISOR TOTAL CLOSED: 1
This category is comprised of licensees that have either not responded to a Brokerage Verification Report after two attempts from the examiner or has failed to appear for the scheduled on-site audit after two attempts. RESOLUTION TYPE: SUPERVISOR REFERRAL TO PROSECUTION TOTAL CLOSED: 0
This category is comprised of licensees that have not responded to a Brokerage Verification Report after three attempts from the supervisor. In these instances, the licensee has either failed to notify IDFPR of their correct address or failed to respond. FOLLOW-UP AUDITS COMPLETED BY EXAMINER
First audits conducted wherein violations have been found are required to show compliance. Completed in December:
RESOLUTION TYPE: FOLLOW-UP – IN COMPLIANCE TOTAL COMPLETED: 14
RESOLUTION TYPE: FOLLOW-UP – REFERRED TO SUPERVISOR TOTAL COMPLETED: 1
AUDITS REFERRED TO SUPERVISOR – CLOSED
Licensees with remaining issues after an initial audit and follow-up or licensees that are unresponsive are referred to supervisor for review and further action. The following are files closed in December:
ACTION TYPE: ISSUES RESOLVED TOTAL COMPLETED: 1
ACTION TYPE: REFERRED TO PROSECUTIONS TOTAL COMPLETED: 1
This semi-annual report is based upon licensees that are actively practicing. It contains the number of audits completed (on-site inspections and audits completed by Brokerage Verification Report) and the total number of violations found with a breakdown of violations in each category of the audit.
TOTAL NUMBER OF AUDITS COMPLETED IN REPORTING PERIOD: 157 TOTAL NUMBER OF AUDITS COMPLETED WITHOUT FINDINGS: 12 TOTAL NUMBER OF FINDINGS: 1,297
2019 YEAR END AUDIT REPORT READ Board – January 9, 2020
FIRST AUDITS COMPLETED IN 2019
INSPECTED (PRACTICING): 196 BROKERAGE VERIFICATION REPORT (PRACTICING): 127 INSPECTED (NOT PRACTICING): 3 BROKERAGE VERIFICATION REPORT (NOT PRACTICING): 30 NOT INSPECTED (OTHER CLOSURES): 44 REFERRED TO SUPERVISOR WITHOUT EXAMINATION: 18 SUPERVISOR REFERRED TO PROSECUTION: 0
FOLLOW-UP AUDITS COMPLETED IN 2019
FOLLOW-UP – IN COMPLIANCE: 272 FOLLOW-UP REFERRED TO SUPERVISOR: 26 FOLLOW-UP – ACKNOWLEDGEMENT PAGE ONLY: 4 FOLLOW-UP NOT REQUIRED – LICENSE STATUS CHANGE: 3 FOLLOW-UP NOT REQUIRED – SPONSOR CHANGE: 2 FOLLOW-UP NO LONGER REQUIRED: 3
AUDITS REFERRED TO SUPERVISOR – CLOSED IN 2019
ISSUES RESOLVED: 24 LICENSE STATUS CHANGE: 3 MISCELLANEOUS: 1 RETURNED TO EXAMINER WITH INSTRUCTION: 9 REFERRED TO PROSECUTION: 16 SPONSOR CHANGE: 1
FIRST AUDITS COMPLETED – FINDINGS SUMMARY (Practicing Licensees)
AUDITS COMPLETED IN 2019: 323 AUDITS COMPLETED WITHOUT FINDINGS: 21 TOTAL NUMBER OF FINDINGS: 2,471
Exams Finding3 I-1 Office – Definite place of business (Sec 5-45(d) & 1450.610)
10 I-2 Office – Signage (Sec 5-45(d) & 1450.725)1 I-3 Unauthorized use of trade name/insignia (logo) (Sec 20-20(a)(13)4 I-4 Office – Separate and distinct area (Sec 5-45(d) & 20-20(a)(4)8 I-5 Office – Licenses available to the public (Sec 5-27(d) & 1450.730)
12 I-6 Licensees (and company) properly licensed (Sec 5-15; 20-20(a)(6); 20-22)4 I-7 Office -- Licensee to notify IDFPR of current address where practicing (5-41 & 1450.150(a)
18 II-1 Written employment agreement with all sponsored licensees (Sec 10-20(c) & 1450.735(a)22 II-2 Employment agreement – Includes minimum provisions (Sec 1450.735(b)34 II-3 Employment agreement – Signed and dated by licensee and broker (Sec 1450.735(b)1 II-9 Corporation for indirect payment – Licensee sole owner/shareholder (Sec 10-20(e)2 II-10 Corporation for indirect payment – Submit Articles to IDPFR (Sec 1450.745(a)1 II-11 Licensee cannot perform activities under corporation for indirect payment (Sec 1450.745(b)2 III-1 Assumed name – Registered in each county (Sec 1450.120(a))8 III-3 Assumed name – Copy of filing or certificate to IDFPR (Sec 1450.120(d)2 III-4 Corporation maintains Illinois Charter with SOS (Sec 20-20(a)(6)&1450.600(c)(2)2 III-10 LLC maintains an Illinois Organization with SOS (Sec 20-20(a)(6)&1450.600(d)(3)1 III-12 Unlicensed LLC members submit affidavit of non-participation to IDFPR (Sec 1450.600(d)(4)
32 IV-1 BALA – All exclusive brokerage agreements must be in writing (Sec 1450.770(a)13 IV-1a BALA – Licensee provides written notice to consumer of designated agent name (Sec 15-35)1 IV-1b BALA – Client referred to another designated agent upon request (Sec 15-15(b) &1450.830)
13 IV-2 BALA – Agreement includes minimum provisions (Sec 1450.770(b)&(c)13 IV-3 BALA – Includes termination of brokerage agreement language (Sec 10-25 & Sec 1450.770(b)(c)&(d)19 IV-4 BALA – Agreement signed and dated by seller and broker (Sec 1450.770(b)(3)&(c)(5)10 IV-5 BALA – Includes required anti-discrimination clause (Sec 1450.770(h)4 IV-6 BALA – Buyer default language in larger print (Sec 1450.770(g)
22 IV-8 BALA – Written consent from property owner(s) for price change (Sec 1450.775(b)4 IV-10 BALA – Protection period subsequent to termination date (Sec 1450.770(i)
10 IV-11 BALA – Licensee provided written disclosure of interest in property (Sec 10-27 & 1450.765)10 IV-11a Completion of the residential real property disclosure report12 IV-11b Completion of the lead-based paint disclosure14 IV-11c Completion of the radon hazards disclosure12 IV-12 Forms for binding real estate contracts stated in heading in bold type (Sec 1450.775(d)21 IV-13 All changes to contract initialed by all parties to the transaction (Sec 1450.775(b)16 IV-14 Sales contracts – Licensee provides written disclosure of interest (Sec 10-27 & 1450.765)36 V-1 All advertising is accurate and truthful (Sec 10-30(a); 20-20(a)(9)&(10); 1450.715; 1450.785(d)8 V-1 Licensee using diminutive or name other that what appears on license (1450.150)
10 V-2 Advertising – Broker business name and franchise appear in advertising (Sec 10-30(d) & 1450.715)2 V-3 Advertising – Property data forms disclose licensee interest (Sec 10-30(c)(1)
15 V-5 Internet advertising accurate and truthful (Sec 10-30(a) & 1450.720; 1450.785(d))3 V-6 Broker business name and franchise appear in internet advertising (Sec 10-30(a) & 1450.720)7 VI-2 Dual agency – Prior written consent from seller/landlord (Sec 15-45(a)8 VI-3 Dual agency – Prior informed written consent from buyer/tenant (Sec 15-45(a)6 VI-4 Dual agency – Informed written confirmation from seller/landlord & buyer/tenant (Sec 15-45(c)2 VI-5 Dual Agency – Licensee cannot serve as dual agent when party to transaction (Sec 1450.820)4 VII-2 Escrow – Escrow money maintained in separate account (Sec 1450.750(b)7 VII-2a Escrow – Deposits timely placed in escrow account (Sec 1450.750(d)7 VII-3a Escrow – Chronological journal maintained for each account (Sec 1450.750(i)(1)9 VII-3b Escrow -- Journal includes required information (Sec 1450.750(i)(1)(A)&(B)9 VII-4 Escrow – Journal maintains a running balance (Sec 1450.750(i)(1)(C)8 VII-5a Escrow – Ledger maintained for each transaction (Sec 1450.750(i)(2)9 VII-5b Escrow – Ledgers include required information (Sec 1450.750(i)(2)9 VII-8 Escrow – Account reconciled within 10 days after receipt of bank statement (Sec 1450.750(i)(3)8 VII-9 Escrow – Maintains written work sheet for each reconciliation (Sec 1450.750(i)(3)
12 VII-10 Escrow – Reconciliation compares bank statement to journal and ledgers (Sec 1450.750(i)(3)2 VII-11 Escrow – Specifications in writing for interest bearing account (Sec 1450.750(b)(1)&(2)6 VIII-1 Record keeping – Licensee maintains records for 5 years (Sec 1450.755)2 VIII-1a Record keeping – Maintain escrow records for 2 years in sponsoring office(Sec 1450.755(a)(2)7 VIII-1b Record keeping – Maintain active transactions in office location (Sec 1450.755(a)(3)(c)1 VIII-3 Record keeping – Escrow backed up once a month (Sec 1450.755(b)1 VIII-4 Record keeping – Escrow journal reduced to hard copy monthly (Sec 1450.755(b)
14 IX-1 Supervision – Implementation of policies and procedures (Sec 10-40 & 1450.705(c)(1)5 IX-2 Supervision – Supervise training of licensees and unlicensed assistants (Sec 1450.705(c)(2)
FINDINGS FOR OFF-SITE AUDITSJuly 1, 2019 thru December 31, 2019
3 IX-3 Supervision – Supervise and assist licensees in real estate transactions (Sec 1450.705(c)(3)9 IX-4 Supervision – Supervise special (escrow) accounts (Sec 1450.705(c)(4)
10 IX-5 Supervision – Supervise advertising for services where license is required (Sec 1450.705(c)(5)3 IX-6 Supervision – Familiarize licensees with requirements of federal & state law (Sec 1450.705(c)(6
Number of Audits: 56Number of Audits without Findings: 2Total Number of Findings: 603
Exams Finding6 I-1 Office – Definite place of business (Sec 5-45(d) & 1450.610)8 I-2 Office – Signage (Sec 5-45(d) & 1450.725)9 I-4 Office – Separate and distinct area (Sec 5-45(d) & 20-20(a)(4)
10 I-5 Office – Licenses available to the public (Sec 5-27(d) & 1450.730)30 I-6 Licensees (and company) properly licensed (Sec 5-15; 20-20(a)(6); 20-22)12 I-7 Office -- Licensee to notify IDFPR of current address where practicing (5-41 & 1450.150(a)45 II-1 Written employment agreement with all sponsored licensees (Sec 10-20(c) & 1450.735(a)39 II-2 Employment agreement – Includes minimum provisions (Sec 1450.735(b)35 II-3 Employment agreement – Signed and dated by licensee and broker (Sec 1450.735(b)1 II-5 Written agreement with all licensed assistants (Sec 10-20(d)1 II-6 Licensed assistants to be compensated by sponsoring broker only (Sec 10-5(c) & 1450.740(f)1 II-7 Duties of unlicensed assistants compliant with Act/Rules (Sec 1450.740(b)(c)&(d)3 II-9 Corporation for indirect payment – Licensee sole owner/shareholder (Sec 10-20(e)3 II-10 Corporation for indirect payment – Submit Articles to IDPFR (Sec 1450.745(a)3 II-11 Licensee cannot perform activities under corporation for indirect payment (Sec 1450.745(b)2 III-1 Assumed name – Registered in each county (Sec 1450.120(a))2 III-10 LLC maintains an Illinois Organization with SOS (Sec 20-20(a)(6)&1450.600(d)(3)5 III-11 Managers/members licensed as managing broker or broker (Sec 5-15(d)&1450.600(d)(1)&(d)(2)7 III-12 Unlicensed LLC members submit affidavit of non-participation to IDFPR (Sec 1450.600(d)(4)1 III-2 Assumed name – Registered with SOS (Sec 1450.120(b)
13 III-3 Assumed name – Copy of filing or certificate to IDFPR (Sec 1450.120(d)1 III-4 Corporation maintains Illinois Charter with SOS (Sec 20-20(a)(6)&1450.600(c)(2)5 III-5 Active corp officers licensed as managing broker or broker (Sec 5-15(b)&1450.600(c)(3)3 III-6 Unlicensed corp officers submit affidavit of non-participation to IDFPR (Sec 1450.600(c)(3)
14 IV-1 BALA – All exclusive brokerage agreements must be in writing (Sec 1450.770(a)12 IV-1a BALA – Licensee provides written notice to consumer of designated agent name (Sec 15-35)18 IV-2 BALA – Agreement includes minimum provisions (Sec 1450.770(b)&(c)11 IV-3 BALA – Includes termination of brokerage agreement language (Sec 10-25 & Sec 1450.770(b)(c)&(d)11 IV-4 BALA – Agreement signed and dated by seller and broker (Sec 1450.770(b)(3)&(c)(5)13 IV-5 BALA – Includes required anti-discrimination clause (Sec 1450.770(h)3 IV-6 BALA – Buyer default language in larger print (Sec 1450.770(g)
16 IV-8 BALA – Written consent from property owner(s) for price change (Sec 1450.775(b)2 IV-10 BALA – Protection period subsequent to termination date (Sec 1450.770(i)
13 IV-11 BALA – Licensee provided written disclosure of interest in property (Sec 10-27 & 1450.765)5 IV-11a Completion of the residential real property disclosure report4 IV-11b Completion of the lead-based paint disclosure6 IV-11c Completion of the radon hazards disclosure
12 IV-12 Forms for binding real estate contracts stated in heading in bold type (Sec 1450.775(d)15 IV-13 All changes to contract initialed by all parties to the transaction (Sec 1450.775(b)14 IV-14 Sales contracts – Licensee provides written disclosure of interest (Sec 10-27 & 1450.765)18 V-1 All advertising is accurate and truthful (Sec 10-30(a); 20-20(a)(9)&(10); 1450.715; 1450.785(d)11 V-1 Licensee using diminutive or name other that what appears on license (1450.150)9 V-2 Advertising – Broker business name and franchise appear in advertising (Sec 10-30(d) & 1450.715)2 V-3 Advertising – Property data forms disclose licensee interest (Sec 10-30(c)(1)
21 V-5 Internet advertising accurate and truthful (Sec 10-30(a) & 1450.720; 1450.785(d))2 V-6 Broker business name and franchise appear in internet advertising (Sec 10-30(a) & 1450.720)1 V-11 Sales plan – Licensee provides evidence of sufficient financing (Sec 20-20(a)(29)(C)1 VI-2 Dual agency – Prior written consent from seller/landlord (Sec 15-45(a)9 VI-3 Dual agency – Prior informed written consent from buyer/tenant (Sec 15-45(a)7 VI-4 Dual agency – Informed written confirmation from seller/landlord & buyer/tenant (Sec 15-45(c)2 VI-5 Dual Agency – Licensee cannot serve as dual agent when party to transaction (Sec 1450.820)4 VII-2 Escrow – Escrow money maintained in separate account (Sec 1450.750(b)9 VII-2a Escrow – Deposits timely placed in escrow account (Sec 1450.750(d)4 VII-3a Escrow – Chronological journal maintained for each account (Sec 1450.750(i)(1)9 VII-3b Escrow -- Journal includes required information (Sec 1450.750(i)(1)(A)&(B)7 VII-4 Escrow – Journal maintains a running balance (Sec 1450.750(i)(1)(C)8 VII-5a Escrow – Ledger maintained for each transaction (Sec 1450.750(i)(2)
10 VII-5b Escrow – Ledgers include required information (Sec 1450.750(i)(2)8 VII-8 Escrow – Account reconciled within 10 days after receipt of bank statement (Sec 1450.750(i)(3)7 VII-9 Escrow – Maintains written work sheet for each reconciliation (Sec 1450.750(i)(3)
10 VII-10 Escrow – Reconciliation compares bank statement to journal and ledgers (Sec 1450.750(i)(3)2 VII-11 Escrow – Specifications in writing for interest bearing account (Sec 1450.750(b)(1)&(2)
12 VIII-1 Record keeping – Licensee maintains records for 5 years (Sec 1450.755)
FINDINGS FOR ON-SITE AUDITSJuly 1, 2019 thru December 31, 2019
10 VIII-1a Record keeping – Maintain escrow records for 2 years in sponsoring office(Sec 1450.755(a)(2)15 VIII-1b Record keeping – Maintain active transactions in office location (Sec 1450.755(a)(3)(c)3 VIII-3 Record keeping – Escrow backed up once a month (Sec 1450.755(b)8 VIII-4 Record keeping – Escrow journal reduced to hard copy monthly (Sec 1450.755(b)8 VIII-5 Record keeping – Escrow journal kept at sponsoring broker office 60 days (Sec 1450.755(b)
25 IX-1 Supervision – Implementation of policies and procedures (Sec 10-40 & 1450.705(c)(1)5 IX-2 Supervision – Supervise training of licensees and unlicensed assistants (Sec 1450.705(c)(2)8 IX-3 Supervision – Supervise and assist licensees in real estate transactions (Sec 1450.705(c)(3)
10 IX-4 Supervision – Supervise special (escrow) accounts (Sec 1450.705(c)(4)8 IX-5 Supervision – Supervise advertising for services where license is required (Sec 1450.705(c)(5)7 IX-6 Supervision – Familiarize licensees with requirements of federal & state law (Sec 1450.705(c)(6
Number of Audits: 101Number of Audits without Findings: 10Total Number of Findings: 694
FY2020 Beginning Balance Revenue Interest Transfers In Expenditures Transfers Out Sweeps/Borrowing Ending BalanceJuly 1,972,919.79$ 50,576.73$ 2,023,496.52$ August 2,023,496.52$ $47,646.87 906.00$ 2,070,237.39$ September $2,070,237.39 $32,180.08 2,102,417.47$ October 2,102,417.47$ 23,221.46$ 2,125,638.93$ November 2,125,638.93$ $33,212.99 2,158,851.92$ December $2,158,851.92 $50,025.48 2,208,877.40$ January -$ February -$ March -$ April -$ May -$ June -$ Total 236,863.61$ -$ -$ -$ -$ -$