The Team Assistant, the Ads, and the Escrow Transfer
Bright Key Realty has 14 licensees, three teams, and one broker/owner, Han. Team leader Cho pays Ms. Yoon an hourly wage. Yoon prepares CMAs from MLS data, writes listing descriptions, hosts open houses when Cho is showing another property, tells visitors 'the seller will take 5% below list,' and twice fills in blanks on offer forms that are then sent to the buyer's agent for signature. Cho's advertisements say 'Bright Key #1 team-guaranteed highest price, 20% above neighborhood average.' Cho also offers a 500,000 KRW gift card to any seller who lists by month-end. Han moved 18,000,000 KRW of earnest money from the trust account to the operating account for nine days to cover payroll, then restored it. The office has no trust ledger, uses one trust account for all clients, and does not reconcile it monthly. Han's independent-contractor agreements state that agents set their own hours but must attend weekly mandatory sales meetings and use company-approved signs.
1. Identify which of Ms. Yoon's activities require a license and explain the broker's supervisory exposure.
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Preparing CMAs from MLS data is clerical only if Yoon is gathering facts and the licensee reviews and interprets the value conclusion. If she selects comparables, adjusts them, or gives an opinion of value to a consumer, that is licensed activity. Writing listing descriptions can be clerical if the licensee supplies the facts and approves the final text, but Yoon should not invent claims or advise on price. Hosting an open house is the clearest problem: an unlicensed assistant may greet visitors and hand out pre-approved materials, but she may not answer substantive questions about the property, terms, or condition, quote the seller's willingness to negotiate, or solicit buyers. Telling visitors 'the seller will take 5% below list' is negotiating on the seller's behalf without a license and also breaches the seller's confidence. Filling in blanks on offer forms and sending them to a buyer's agent is unauthorized practice; offer preparation and terms require a licensee and broker review.
Han's exposure is supervisory. The broker is responsible for acts of unlicensed staff and team members within the brokerage, even if they are independent contractors. The pattern is not a single mistake; it is an unlicensed assistant performing licensed activity repeatedly with the team leader's knowledge. That supports discipline, fines, license suspension, and civil liability, and it may void insurance coverage if the office failed to supervise.
2. Evaluate Cho's advertising claims and the 500,000 KRW gift card. What must be corrected?
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'Guaranteed highest price' is an unprovable guarantee and is deceptive because no broker can guarantee a sale price. '20% above neighborhood average' needs a defined neighborhood, a defined average, a time period, and verifiable data; without that, it is misleading. '#1 team' may be used only if there is an objective, current basis and the claim is not likely to deceive; otherwise it should be removed. Team advertising must identify the brokerage and the responsible broker, and the broker must approve it before publication. Cho should replace the claims with specific, supportable facts, such as 'closed 18 transactions in this district in the past 12 months,' if those facts are true and documented.
The gift card is an inducement. It must be disclosed in writing to the seller and cannot be a secret rebate. It also must not be used to steer a seller away from a competing brokerage or to disguise a commission split with an unlicensed person. If the gift card is paid to the seller at closing, the settlement statement should show it or the brokerage should document it as a marketing incentive. Han should require prior approval of all team ads and promotions, keep a file of substantiation, and prohibit guarantees.
3. Design the escrow and supervision corrections Han should make immediately.
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Han must stop using trust money for operations. The 18,000,000 KRW transfer was conversion even though it was restored; restoration does not cure the breach. Immediately deposit all earnest money in a properly titled trust account, create a separate ledger for each transaction showing receipt, disbursement, and balance, and reconcile the account monthly to the bank statement. Require two signatures or broker approval for disbursements, prohibit transfers to the operating account, and keep copies of deposit slips and client authorizations. Do not release earnest money without a signed release from both parties or a court order. Notify the brokerage's attorney and errors-and-omissions carrier about the transfer and documented correction.
For supervision, Han should issue a written policy that unlicensed staff may not host open houses unsupervised, discuss terms, quote seller motivation, prepare or fill in offer forms, or give value opinions. Require a licensee to review and sign every CMA and advertisement. Assign a compliance officer, conduct monthly file audits, and train all teams on agency, advertising, and escrow. Review the independent-contractor agreements with counsel: mandatory meetings and required signs may be acceptable if they do not control the agents' hours and methods, but the combination of rules could increase reclassification risk. Document every corrective action.