Washington Administrative Code › Title 308 - Licensing, Department of (See also Titles 36, 98 and 196) › Chapter 308-124E - Real estate-Trust account procedures › CLIENT FUNDS › Section 308-124E-105 - Administration of funds held in trust - General procedures

Current through Register Vol. 24-14, July 15, 2024
Any real estate broker who receives funds or moneys from any
				  principal or any party to a real estate or business opportunity transaction,
				  property management agreement, contract/mortgage collection agreement, or
				  advance fees, shall hold the funds or moneys in trust for the purposes of the
				  brokerage service contract or transaction, and shall not utilize such funds or
				  moneys for the benefit of the broker, managing broker, real estate firm or any
				  person not entitled to such benefit. Designated brokers are responsible for
				  ensuring their affiliated licensees safeguard client funds by following these
				  rules. Funds or moneys received in trust shall be deposited in a bank, savings
				  association, or credit union insured by the Federal Deposit Insurance
				  Corporation or the share insurance fund of the National Credit Union
				  Administration, or any successor federal deposit insurer. The designated broker
				  is responsible for the administration of trust funds and accounts to include,
				  but not be limited to:
. Depositing;
. Holding;
. Disbursing;
. Receipting;
. Posting;
. Recording;
. Accounting to principals;
. Notifying principals and cooperating licensees of material
				  facts; and
. Reconciling and properly setting up a trust account. The
				  designated broker is responsible for handling trust funds as provided
				  herein.
(1) Bank accounts shall be
				designated as trust accounts in the firm name or assumed name as
				licensed.
(2) Interest credited to
				a client's account must be recorded as a liability on client ledger. Interest
				assigned or credited by written assignment agreement to the firm may not be
				maintained in the trust account. The designated broker is responsible for
				making arrangements with the financial institution to credit this interest to
				the general account of the firm.
(3) The designated broker shall establish and
				maintain a system of records and procedures approved by the real estate program
				that provides for an audit trail accounting of all funds received and
				disbursed. All funds must be identified to the account of each individual
				client.
(4) Alternative systems of
				records or procedures proposed by a designated broker shall be approved in
				advance in writing by the real estate program.
(5) The designated broker shall be
				responsible for deposits, disbursements, or transfers of clients' funds
				received and held in trust.
(6) All
				funds or moneys received for any reason pertaining to the sale, renting,
				leasing, optioning of real estate or business opportunities, contract or
				mortgage collections or advance fees shall be deposited in the firm's real
				estate trust bank account not later than the first banking day following
				receipt thereof; except:
(a) Cash must be
				deposited in the firm's trust account the next banking day;
(b) Checks received as earnest money deposits
				when the earnest money agreement states that a check is to be held for a
				specified length of time or until the occurrence of a specific event;
				and
(c) For purposes of this
				section, Saturday, Sunday, or other legal holidays as defined in
				RCW
				1.16.050 shall not be considered a banking
				day.