Key Takeaways
- Real estate fraud can be prosecuted under federal statutes carrying sentences of up to 30 years imprisonment.
- Punitive damages for egregious fiduciary breaches are not covered by E&O insurance.
- Brokers can be held vicariously liable for agent misconduct under respondeat superior.
- Comprehensive training and compliance systems can reduce broker liability exposure.
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Test Your Knowledge
1.What type of insurance typically excludes coverage for punitive damages?
2.Under what circumstances can a broker be held liable for the actions of their agents?
3.What is the typical penalty for criminal prosecution of trust fund theft in real estate?