S.B. 69 Enrolled

REAL ESTATE AGENT BACKGROUND CHECK
1997 GENERAL SESSION
STATE OF UTAH
Sponsor: Michael G. Waddoups
AN ACT RELATING TO SECURITIES, REAL ESTATE DIVISION; REQUIRING
FINGERPRINT CARDS AND THE CONSENT TO A FINGERPRINT BACKGROUND
CHECK OF ANY NEW SALES AGENT APPLICANT; PROVIDING THE COSTS TO
BE BORNE BY THE APPLICANT; REQUIRING THE DIVISION TO REQUEST A
CRIMINAL BACKGROUND CHECK ON ANY NEW SALES AGENCY APPLICANT;
PROVIDING FOR CONDITIONAL LICENSURE AND SUBSEQUENT REVOCATION
UPON NONDISCLOSURE OF CRIMINAL HISTORY; AND MAKING TECHNICAL
CHANGES.
This act affects sections of Utah Code Annotated 1953 as follows:
AMENDS:
61-2-5.1, as enacted by Chapter 161, Laws of Utah 1987
61-2-9, as last amended by Chapter 102, Laws of Utah 1996
61-2-11, as last amended by Chapter 102, Laws of Utah 1996
Be it enacted by the Legislature of the state of Utah:
Section 1. Section 61-2-5.1 is amended to read:
61-2-5.1. Procedures -- Adjudicative proceedings.
The Division of Real Estate shall comply with the procedures and requirements of Title
63, Chapter 46b, Administrative Procedures Act, in its adjudicative proceedings.
Section 2. Section 61-2-9 is amended to read:
61-2-9. Examination and license fees -- Renewal of licenses -- Education
requirements -- Activation of inactive licenses -- Recertification -- Licenses of firm,
partnership, or association -- Miscellaneous fees.
(1) (a) Upon filing an application for a principal broker, associate broker, or sales agent
license examination, the applicant shall pay a nonrefundable fee as determined by the commission
with the concurrence of the division under Section 63-38-3.2 for admission to the examination.

(b) A principal broker, associate broker, or sales agent applicant shall pay a nonrefundable
fee as determined by the commission with the concurrence of the division under Section 63-38-3.2
for issuance of an initial license or license renewal.
(c) Each license issued under this subsection shall be issued for a period of not less than two
years as determined by the division with the concurrence of the commission.
(d) (i) Any new sales agent applicant shall submit fingerprint cards in a form acceptable to
the division at the time the license application is filed and shall consent to a fingerprint background
check by the Utah Bureau of Criminal Identification and the Federal Bureau of Investigation
regarding the application.
(ii) The division shall request the Department of Public Safety to complete a Federal Bureau
of Investigation criminal background check for each new sales agent applicant through the national
criminal history system (NCIC) or any successor system.
(iii) The cost of the background check and the fingerprinting shall be borne by the applicant.
(e) (i) Any new sales agent license issued under this section shall be conditional, pending
completion of the criminal background check. If the criminal background check discloses the
applicant has failed to accurately disclose a criminal history, the license shall be immediately and
automatically revoked.
(ii) Any person whose conditional license has been revoked under Subsection (e)(i) shall be
entitled to a post-revocation hearing to challenge the revocation. The hearing shall be conducted in
accordance with Title 63, Chapter 46b, Administrative Procedures Act.
(2) (a) A license expires if it is not renewed on or before its expiration date. Effective
January 1, 1992, as a condition of renewal, each active licensee shall demonstrate competence by
viewing an approved real estate education video program and completing a supplementary
workbook, or complete 12 hours of professional education approved by the division and commission
within each two-year renewal period. The division with the concurrence of the commission shall
certify education which may include, but shall not be limited to, state conventions, home study
courses, video courses, and closed circuit television courses. The commission with concurrence of
the division may exempt a licensee from this education requirement for a period not to exceed four

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years upon a finding of reasonable cause and under conditions established by rule.
(b) For a period of 30 days after the expiration date, a license may be reinstated upon
payment of a renewal fee and a late fee determined by the commission with the concurrence of the
division under Section 63-38-3.2 and upon providing proof acceptable to the division and the
commission of the licensee having completed the hours of education or demonstrated competence
as required under Subsection (2)(a).
(c) After this 30-day period, and until six months after the expiration date, the license may
be reinstated by:
(i) paying a renewal fee and a late fee determined by the commission with the concurrence
of the division under Section 63-38-3.2;
(ii) providing to the division proof of satisfactory completion of the applicable hours of
prelicensing education required under Section 61-2-6, which must be completed within six months
prior to reinstatement, or providing to the division evidence of successful completion of the
respective sales agent or broker licensing examination within six months prior to reinstatement; and
(iii) providing proof acceptable to the division and the commission of the licensee having
completed the hours of education or demonstrated competence as required under Subsection (2)(a).
(d) A person who does not renew his license within six months after the expiration date shall
be relicensed as prescribed for an original application.
(3) As a condition for the activation of an inactive license, a licensee shall supply the
division with proof of:
(a) successful completion of the respective sales agent or broker licensing examination
within six months prior to activation; or
(b) the successful completion of the number of hours of continuing education that the
licensee would have been required to complete under Subsection (2)(a) if the licensee's license had
been on active status, up to the number of hours required for original licensure. Credit shall be given
only for education that has been taken within the five years preceding activation, except that at least
12 hours of the education must have been taken within 12 months preceding activation.
(4) A principal broker license may be granted to a corporation, partnership, or association

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if the corporation, partnership, or association has affiliated with it an individual who has qualified
as a principal broker under the terms of this chapter, and who serves in the capacity of a principal
broker. Application for the license shall be made in accordance with the rules adopted by the
division with the concurrence of the commission.
(5) The division may charge and collect reasonable fees determined by the commission with
the concurrence of the division under Section 63-38-3.2 to cover the costs for:
(a) issuance of a new or duplicate license;
(b) license histories or certifications;
(c) certified copies of official documents, orders, and other papers and transcripts;
(d) certifying real estate schools, courses, and instructors, the fees for which shall,
notwithstanding Section 13-1-2, be deposited in the Real Estate Education, Research, and Recovery
Fund; and
(e) other duties required by this chapter.
(6) If a licensee submits or causes to be submitted a check, draft, or other negotiable
instrument to the division for payment of fees, and the check, draft, or other negotiable instrument
is dishonored, the transaction for which the payment was submitted is void and will be reversed by
the division if payment of the applicable fee is not received in full.
(7) The fees under this chapter and the additional license fee for the Real Estate Education,
Research, and Recovery Fund under Section 61-2a-4 are in lieu of all other license fees or
assessments that might otherwise be imposed or charged by the state or any of its political
subdivisions, upon, or as a condition of, the privilege of conducting the business regulated by this
chapter, except that a political subdivision within the state may charge a business license fee if the
licensee maintains a place of business within the jurisdiction of the political subdivision. Unless
otherwise exempt, each licensee under this chapter is subject to all taxes imposed under Title 59,
Revenue and Taxation.
Section 3. Section 61-2-11 is amended to read:
61-2-11. Investigations -- Subpoena power of division -- Grounds for disciplinary
action.

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The division may investigate or cause to be investigated the actions of any principal broker,
associate broker, sales agent, real estate school, course provider, or school instructor licensed or
certified by this state, or of any applicant for licensure or certification, or of any person who acts in
any of those capacities within this state. The division is empowered to subpoena witnesses, take
evidence, and require by subpoena duces tecum the production of books, papers, contracts, records,
other documents, or information considered relevant to the investigation. The division may serve
subpoenas by certified mail. Each failure to respond to a subpoena is considered as a separate
violation of this chapter. The commission, with the concurrence of the director, may impose a civil
penalty in an amount not to exceed $500 per violation, impose educational requirements, and
suspend, revoke, place on probation, or deny renewal, reinstatement, or reissuance of any license or
any certification if at any time the licensee or certificate holder, whether acting as an agent or on his
own account, is found guilty of:
(1) making any substantial misrepresentation;
(2) making any false promises of a character likely to influence, persuade, or induce;
(3) pursuing a continued and flagrant course of misrepresentation, or of making false
promises through agents, sales agents, advertising, or otherwise;
(4) acting for more than one party in a transaction without the informed consent of all
parties;
(5) acting as an associate broker or sales agent while not licensed with a licensed principal
broker, representing or attempting to represent a broker other than the principal broker with whom
he is affiliated, or representing as sales agent or having a contractual relationship similar to that of
sales agent with other than a licensed principal broker;
(6) failing, within a reasonable time, to account for or to remit any monies coming into his
possession that belong to others, or commingling those funds with his own, or diverting those funds
from the purpose for which they were received;
(7) paying or offering to pay valuable consideration, as defined by the commission, to any
person not licensed under this chapter, except that valuable consideration may be shared with a
licensed principal broker of another jurisdiction or as provided under the Professional Corporation

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Act or the Limited Liability Company Act;
(8) being unworthy or incompetent to act as a principal broker, associate broker, or sales
agent in such manner as to safeguard the interests of the public;
(9) failing to voluntarily furnish copies of all documents to all parties executing the
documents;
(10) failing to keep and make available for inspection by the division a record of each
transaction, including the names of buyers and sellers or lessees and lessors, the identification of the
property, the sale or rental price, any monies received in trust, any agreements or instructions from
buyers and sellers or lessees and lessors, and any other information required by rule;
(11) failing to disclose, in writing, in the purchase, sale, or rental of property, whether the
purchase, sale, or rental is made for himself or for an undisclosed principal;
(12) regardless of whether the crime was related to real estate, being convicted of a criminal
offense involving moral turpitude within five years of the most recent application, including a
conviction based upon a plea of nolo contendere, or a plea held in abeyance to a criminal offense
involving moral turpitude;
(13) advertising the availability of real estate or the services of a licensee in a false,
misleading, or deceptive manner;
(14) in the case of a principal broker or a licensee who is a branch manager, failing to
exercise reasonable supervision over the activities of his licensees and any unlicensed staff;
(15) violating or disregarding this chapter, an order of the commission, or the rules adopted
by the commission and the division;
(16) breaching a fiduciary duty owed by a licensee to his principal in a real estate
transaction;
(17) any other conduct which constitutes dishonest dealing;
(18) unprofessional conduct as defined by statute or rule; or
(19) suspension, revocation, surrender, or cancellation of a real estate license issued by
another jurisdiction, or of another professional license issued by this or another jurisdiction, based
on misconduct in a professional capacity that relates to character, honesty, integrity, or truthfulness.

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