02 DEPARTMENT OF PROFESSIONAL AND FINANCIAL REGULATION

1. 039 real estate commission
   1. Chapter 400: REAL ESTATE BROKERAGE AGENCY AND DESIGNATED BROKER RESPONSIBILITIES

Summary: This chapter details requirements of maintaining a real estate brokerage agency and establishes the specific supervisory responsibilities of the designated broker.

SECTION 1. Responsibilities of Designated Broker

1. 1. 1. Generally

The designated broker shall supervise the activities of affiliated licensees and unlicensed persons involved in the operation of the real estate brokerage agency including all branch offices.

The supervision includes, at a minimum, the establishment of policies and procedures that enable the designated broker to review, manage and oversee the following:

1. 1. 1. 1. Real estate transactions performed by an affiliated licensee;
         2. Documents that may have a material effect upon the rights or obligations of a party to a real estate transaction in which the agency is involved;
         3. Filing, storage and maintenance of documents referenced in Section 1(1)(B);
         4. The handling of money received by the real estate brokerage agency on behalf of any party to a real estate transaction;
         5. The advertising of any service for which a real estate license is required that is provided by the agency or affiliated licensees;
         6. The familiarization by the affiliated licensee with the requirements of federal and state law governing real estate transactions;
         7. Timely dissemination to affiliated licensees of all regulatory information received by the real estate brokerage agency pertinent to the practice of real estate brokerage;
         8. Registration, development and content of any internet site intended to promote (i) real estate brokerage services by the agency and affiliated licensees or (ii) the sale or purchase of real estate through the agency; and

1. I. Affiliated licensees are properly licensed including completion of continuing education requirements for license renewal.

SECTION 2. Monitoring Compliance

The designated broker shall establish systems for monitoring compliance with the real estate brokerage agency’s policies, rules, and procedures that include regularly meeting with and assisting and advising affiliated licensees, developing and distributing company policy manuals, and offering training programs and resource materials.

1. 1. Delegation

The designated broker may designate another person to assist in administering the provisions of the Commission’s rules. However, the designated broker does not relinquish overall responsibility for the supervision of affiliated licensees and unlicensed persons involved in the operation of the real estate brokerage agency.

1. 1. 1. Company Policy

The designated broker shall have, and make available to agency affiliates and unlicensed persons working with the agency a written company policy that identifies and describes the types of real estate brokerage relationships in which the real estate brokerage agency may and may not engage. In addition, the company policy must also include the procedures intended to prevent any mishandling of information through both formal and informal sharing of information within the real estate brokerage agency, the arrangement of agency office space and the personal relationships of affiliated licensees who are representing buyers and sellers with adverse interests.

The designated broker shall review and update the written company policy as needed.

1. 1. 1. Review of Sales Agent Documents

The designated broker, at a minimum, shall review and initial, as soon as possible, all contracts, property data sheets, disclosure forms, market analyses and other relevant information prepared by a sales agent for buyers and sellers during the first ninety (90) days that a sales agent is affiliated with a real estate brokerage agency. If a sales agent changes real estate brokerage agency affiliation during the license term, this requirement will apply again for the first ninety (90) days with the new agency and the new designated broker is responsible. The requirements of this Subsection are not intended to affect the validity of a contract.

SECTION 3. REAL ESTATE TRUST ACCOUNTS

1. 1. 1. Definition of “Earnest Money Deposit”

As used in this Section, the term “earnest money deposit” includes money provided to a real estate brokerage agency as part of an offer to purchase real estate and all other money held by the real estate brokerage agency for clients or other persons for purposes related to a real estate brokerage transaction.

1. 1. 1. Various Forms of Real Estate Trust Accounts

A real estate trust account shall be in the form of a checking or savings account and may accrue interest on an earnest money deposit provided that the accumulated interest is properly disbursed. If the parties to the transaction agree to place the earnest money deposit in something other than a real estate trust account, the real estate brokerage agency shall not hold the funds or act as trustee.

If accumulated interest is to be distributed to a charity or other such organization, proper written notice of the intended disbursement must be overtly posted in a manner readily accessible to the public, either physically, by electronics means, or otherwise.

1. 1. 1. Opening a Real Estate Trust Account

The real estate trust account checks and bank statements must contain the real estate brokerage agency’s trade name as licensed by the Commission and must be imprinted with the words “real estate trust account.”

1. 1. 1. Making Earnest Money Deposits

An earnest money deposit provided to a designated broker as trustee as part of an offer to purchase real estate shall be deposited within five (5) business days of acceptance of the offer unless otherwise specified in the purchase and sale agreement. Other earnest money deposits received by the designated broker as trustee shall be deposited within five (5) business days of the trustee’s receipt of such earnest money deposits.

1. 1. 1. Restrictions on Earnest Money Deposits in Real Estate Trust Accounts

A designated broker, as trustee, shall not commingle earnest money deposits with either:

1. 1. 1. 1. Funds belonging to the real estate brokerage agency. This provision shall not be construed to limit deposits made by the real estate brokerage agency of an amount sufficient to maintain the account, but such amount shall not exceed $500; or
         2. Funds held for persons that do not involve the sale, purchase or exchange of real estate.

An earnest money deposit may be utilized prior to a closing only for reasons specified in writing by all parties to the real estate transaction. There shall be a proper accounting for all monies held by the real estate brokerage agency and any remittance shall be made within a reasonable time, but not more than thirty (30) days, after the conclusion of the real estate transaction.

1. 1. 1. Maintaining Real Estate Trust Account Records

The designated broker shall be responsible for maintaining records and supporting documents sufficient to verify the adequacy and proper use of the real estate trust account. The records and supporting documents shall be maintained for a period of at least three (3) years after the date all funds are disbursed.

1. 1. 1. Information Included in Minimum Real Estate Trust Account Records

At a minimum, real estate trust account records shall include a ledger or journal which records in chronological order all receipts and disbursements of funds in the real estate trust account and provides the following information:

1. 1. 1. 1. The date the earnest money deposit is received by the real estate brokerage agency;
         2. The date the earnest money deposit is received by the banking institution;
         3. The purpose of the earnest money deposit and from whom received;
         4. The purpose of the withdrawal and to whom paid;
         5. The amount of the earnest money deposit;
         6. The current running balance of funds held by the real estate brokerage agency; and
         7. The closing date of a transaction, if any, or the date the earnest money deposit was disbursed.
      1. Real Estate Trust Account Supporting Documents

Real estate trust account supporting documents shall include:

1. 1. 1. 1. Bank statements;
         2. Canceled checks;
         3. Copies of contracts;
         4. Closing statements, if available;
         5. Correspondence; and
         6. Additional items necessary to verify and explain record entries.
      1. Disbursement of Undisputed Earnest Money Deposits Held in Trust

Disbursement of an undisputed earnest money deposit may occur by one of the two following procedures:

1. 1. 1. 1. Authorization, in writing, from the parties to a real estate transaction agreeing to the disbursement; or
         2. Authorization by the designated broker who, in reasonable reliance on the terms of the purchase and sale agreement or other written documents signed by both parties, determines the appropriate disbursement of the undisputed earnest money deposit. The designated broker may, at the designated broker’s own discretion, make such disbursement to release the undisputed earnest money deposit no sooner than five (5) business days after notifying all parties of the designated broker’s proposed decision to release the undisputed earnest money deposit. The earnest money deposit shall not be disbursed under this Subsection if prior to disbursement the designated broker receives actual knowledge of a dispute as provided in Section 3(10) of this chapter.
      1. Disputed Earnest Money
         1. Any time that more than one party to a transaction makes demand on the earnest money deposit for which the real estate brokerage agency is acting as trustee, the designated broker shall:
         2. Notify each party, in writing, within five (5) business days of the demand of the other party; and
         3. Keep all parties to the transaction informed of any actions by the designated broker regarding the disputed earnest money deposit, including retention of the earnest money deposit by the designated broker until receipt of written release from both parties agreeing to the disposition of the earnest money deposit or agreeing that the dispute has been properly resolved.
         4. After notice as provided in Section 3(10)(A)(1) of this chapter, the designated broker may reasonably rely on the terms of the purchase and sale agreement or other written documents signed by both parties to determine the disposition of the disputed earnest money deposit and may, at the designated broker’s own discretion, make such disbursement no sooner than five (5) business days after notifying both parties of the designated broker’s proposed disbursement of the earnest money deposit. This discretionary disbursement by the designated broker is not a violation of Title 32, Chapter 114 of the Maine Revised Statutes or Commission rules, but may not relieve the designated broker of civil liability.
         5. The designated broker may hold the earnest money deposit until ordered by a court of proper jurisdiction or agreement of the parties to make a disbursement. The designated broker shall give all parties written notice of any decision to hold the earnest money deposit pending a court judgment or agreement of the parties for disbursement.
         6. Absent written authorization from the party to be charged, the designated broker is not entitled to withhold any portion of the earnest money deposit when a real estate transaction fails to close even if a commission is earned. The earnest money deposit must be disposed of as provided by Section 3(10) of this chapter.

SECTION 4. Record Retention Schedules; Format

1. 1. 1. Generally

All real estate brokerage records, including real estate trust account and supporting records, transaction files, and other brokerage-related records, are to be under the control of the designated broker and made available to the Director upon request. Except for rejected offers and counteroffers, which must be kept for one (1) year from the date of the rejected offer or counteroffer, the following records must be kept by the designated broker for three (3) calendar years after all funds held by the designated broker in connection with a transaction have been disbursed or until the conclusion of the transaction, whichever last occurs:

1. 1. 1. 1. The original or a true copy of all purchase and sale contracts;
         2. Listing or buyer brokerage representation agreements, appointed agent consent forms, disclosed dual agent consent forms and the Real Estate Brokerage Relationships Form required under Chapter 410, Section 9 of the Commission’s rules;
         3. Property disclosure information forms, data sheets and other property information prepared by the real estate brokerage agency or one of its affiliated licensees to promote property for sale or purchase;
         4. Real Estate Trust Account ledger records, as listed in Section 3(7) of this chapter; and
         5. Real Estate Trust Account reconciliation records, as listed in Section 3(8) of this chapter: and
         6. Other transaction documents, including written documents, electronic messages including email and text messages, and any other type of document in any format.
      1. Electronic Format

Real estate brokerage records may be maintained in electronic format, as defined by Title 10, Chapter 1051 of the Maine Revised Statutes. An electronic record means a record generated, communicated, received or stored by electronic means. Such electronic records must be in a format that has the continued capability to be retrieved and legibly printed. Upon request of the Director, printed records shall be produced.

SECTION 5. Examinations for Compliance with Licensing Laws

1. 1. A real estate brokerage office may be examined for compliance with Title 32, Chapter 114 of the Maine Revised Statutes and Commission rules:

1. As a matter of routine once each licensing period;
2. As necessary as part of an investigation of a complaint filed with the Director;
3. Upon receipt of prima facie evidence indicating improper use of a real estate trust account.

1. 2. The designated broker shall produce for inspection to an authorized representative of the Commission any document or record reasonably necessary for investigation or audit in the enforcement of Title 32, Chapter 114 of the Maine Revised Statutes and the rules promulgated by the Commission.

1. 1. 1. Failure to submit such documents or records as requested by the Director or authorized representative of the Commission shall be grounds for disciplinary action.

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STATUTORY AUTHORITY: 32 M.R.S. §§ 13065(7), 13178, 13179, 13184

EFFECTIVE DATE:

July 1, 2006 – filing 2006-192

July 29, 2009 – filing 2009-377

1. APAO ACCESSIBILITY CHECK: October 17, 2025 (no issues detected)

   REPEALED AND REPLACED:

   October 26, 2025 – filing 2025-210