California Regulations of the Real Estate Commissioner – Cite and Fine!
In California, all brokers and salespersons are required to follow the “regulations of the real estate commissioner.” One of rules addresses the “cite and fine” process. This blog discusses this disciplinary process in general. When you are being audited (for example a California property management audit), following the audit you may be facing either a formal accusation (that seeks to restrict, revoke or suspend your real estate license), or if there are only MINOR violations, you may be recommended for “cite and fine” resolution.
2907.2. Citation – Applicability of Citation and Amount of Administrative Fine.
The commissioner’s regulations discuss certain factors the BRE will look to when deciding what the appropriate level of punishment or discipline is following an audit. Here are some of the factors from the code. Each should be weighed according to the facts of the case.
(a) When determining whether to apply the citation and fine process in lieu of a formal accusation, and in determining the amount of the fine assessed, the Commissioner shall take into consideration the following:
(1) The gravity of the violation or violations;
(2) Actual injury or risk of potential harm to consumers as a result of the violation;
(3) Whether the investigation and/or citation addresses multiple violations;
(4) Nature and extent of the person’s or entity’s history of violations of the Real Estate Law or Subdivided Lands Law and/or prior disciplinary action by the Bureau;
(5) The extent to which the person or entity has exhibited good faith;
(6) Degree of cooperation with the Bureau’s investigation;
(7) Attempts to mitigate any loss, damage, or harm caused by the violation;
(8) Other facts relevant to the violation that present good cause for aggravation or mitigation of a penalty.
As you can see, cooperating with the investigation is always important, as other mitigation factors.
What are the “cite and fine” limits?
Here is the code dealing with the fines and fees you could be facing if you get a cite and fine:
(b) Where the person cited holds a real estate license, the total fine assessment in the citation shall not exceed $2,500, even where a citation lists more than one violation. Each of the violations listed will relate to the same Bureau investigation.
(c) Where the person cited is an unlicensed person, a citation may issue for each unlicensed act. Before assessing an administrative fine via citation for a violation of Section 10130, Section 10166.02, or Section 10167.2 of the Business and Professions Code for an activity or activities requiring a license and/or license endorsement, the Commissioner shall give due consideration to the gravity of the violation, including, but not limited to, a consideration of the factors described in subdivision (a), above, and the following factors:
(1) Whether the unlicensed person or entity committed numerous or repeated violations;
(2) Whether the unlicensed person or entity falsely represented that he/she/it was licensed; 348 REGULATIONS OF THE REAL ESTATE COMMISSIONER
(3) Whether the unlicensed person or entity committed any act that would be cause for disciplinary action against a licensee;
(4) Whether the unlicensed person or entity claimed or received compensation for the acts, and the amount of compensation claimed or received;
(5) Whether the unlicensed person or entity was previously issued an Order to Desist and Refrain by the Bureau, or was formerly licensed and/or disciplined as a licensee and reasons why that license is no longer in effect.
Can I appeal a “cite and fine” assessment by the CalBRE?
The issue of whether you CAN appeal (yes you can), and whether you WANT to appeal are two different things. When you get a cite and fine you will get a list of compliance violations and a fine for each (ex. trust fund shortage or failure to keep trust fund records – cost $250). Each violation carries a fine or fee. You can challenge any of these line items by setting up a hearing. Here is the applicable code section. We can help you if you want representation.
2907.3. Appeal of Citation.
(a) The cited person or entity may contest any or all of the following aspects of the citation:
(1) The occurrence of a violation of the Real Estate Law;
(2) Reasonableness of an order of correction;
(3) The period of time allowed for correction;
(4) The amount of an administrative fine assessed in the citation.
(b) Within 30 days after receipt of the citation, the person or entity cited may make a written notification to the Commissioner that the person or entity intends to request a formal hearing on the citation. The Commissioner may extend the 30-day period for a written appeal upon the showing of good cause.
(c) The Commissioner’s designee shall hold the citation review conference with the person or entity cited within 60 days from the receipt of the notification of intention to request a formal hearing.
(d) After the citation review conference, the Bureau shall serve notice, in writing to the person or entity cited, regarding whether the citation remains unchanged, or is amended or dismissed. Such notice shall include information enabling the person or entity cited to request a formal hearing on the citation in accordance with subdivision (d) of Section 10080.9 of the Code.
(e) If, within 30 days from the receipt of the post-conference notice, the person or entity fails to request a formal hearing on the citation, the citation and fine shall be deemed final.
(f) The Bureau may seek, pursuant to Section 10106 of the Code, to recover its costs for investigation and enforcement of a citation should the case proceed to formal hearing.
Contact a CalBRE real estate licensing defense law firm
We can help you if you are facing a real estate investigation, subpoena, complaint, recovery account action, arbitration, mediation, accusation, statement of issues, or other compliance issue in California or Arizona. Call us at (877) 276-5084 we can represent you at all BRE offices in California including Oakland, Los Angeles, Fresno, San Diego, and Sacramento. We also assist Arizona licenses with issues before the ADRE. We offer flat rate legal fees for many of our services. Drop us an email to contact one of our real estate lawyers. Please make sure to leave your phone number.
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