97TH GENERAL ASSEMBLY
State of Illinois
2011 and 2012
HB1221

 

Introduced 02/08/11, by Rep. Michael J. Zalewski

 

SYNOPSIS AS INTRODUCED:
 
225 ILCS 454/20-20

    Amends the Real Estate License Act of 2000. Provides that the Department may impose a fine not to exceed $35,000 (up from $25,000) for any one or any combination of the grounds for discipline.


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FISCAL NOTE ACT MAY APPLY

 

 

A BILL FOR

 

HB1221LRB097 06562 CEL 46647 b

1    AN ACT concerning regulation.
 
2    Be it enacted by the People of the State of Illinois,
3represented in the General Assembly:
 
4    Section 5. The Real Estate License Act of 2000 is amended
5by changing Section 20-20 as follows:
 
6    (225 ILCS 454/20-20)
7    (Section scheduled to be repealed on January 1, 2020)
8    Sec. 20-20. Grounds for discipline.
9    (a) The Department may refuse to issue or renew a license,
10may place on probation, suspend, or revoke any license,
11reprimand, or take any other disciplinary or non-disciplinary
12action as the Department may deem proper or impose a fine not
13to exceed $35,000 $25,000 upon any licensee under this Act or
14against a licensee in handling his or her own property, whether
15held by deed, option, or otherwise, for any one or any
16combination of the following causes:
17        (1) Fraud or misrepresentation in applying for, or
18    procuring, a license under this Act or in connection with
19    applying for renewal of a license under this Act.
20        (2) The conviction of, plea of guilty or plea of nolo
21    contendre to a felony or misdemeanor, an essential element
22    of which is dishonesty or fraud or larceny, embezzlement,
23    or obtaining money, property, or credit by false pretenses

 

 

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1    or by means of a confidence game, in this State, or any
2    other jurisdiction.
3        (3) Inability to practice the profession with
4    reasonable judgment, skill, or safety as a result of a
5    physical illness, including, but not limited to,
6    deterioration through the aging process or loss of motor
7    skill, or a mental illness or disability.
8        (4) Practice under this Act as a licensee in a retail
9    sales establishment from an office, desk, or space that is
10    not separated from the main retail business by a separate
11    and distinct area within the establishment.
12        (5) Disciplinary action of another state or
13    jurisdiction against the license or other authorization to
14    practice as a managing broker, broker, salesperson, or
15    leasing agent if at least one of the grounds for that
16    discipline is the same as or the equivalent of one of the
17    grounds for discipline set forth in this Act. A certified
18    copy of the record of the action by the other state or
19    jurisdiction shall be prima facie evidence thereof.
20        (6) Engaging in the practice of real estate brokerage
21    without a license or after the licensee's license was
22    expired or while the license was inoperative.
23        (7) Cheating on or attempting to subvert the Real
24    Estate License Exam or continuing education exam.
25        (8) Aiding or abetting an applicant to subvert or cheat
26    on the Real Estate License Exam or continuing education

 

 

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1    exam administered pursuant to this Act.
2        (9) Advertising that is inaccurate, misleading, or
3    contrary to the provisions of the Act.
4        (10) Making any substantial misrepresentation or
5    untruthful advertising.
6        (11) Making any false promises of a character likely to
7    influence, persuade, or induce.
8        (12) Pursuing a continued and flagrant course of
9    misrepresentation or the making of false promises through
10    licensees, employees, agents, advertising, or otherwise.
11        (13) Any misleading or untruthful advertising, or
12    using any trade name or insignia of membership in any real
13    estate organization of which the licensee is not a member.
14        (14) Acting for more than one party in a transaction
15    without providing written notice to all parties for whom
16    the licensee acts.
17        (15) Representing or attempting to represent a broker
18    other than the sponsoring broker.
19        (16) Failure to account for or to remit any moneys or
20    documents coming into his or her possession that belong to
21    others.
22        (17) Failure to maintain and deposit in a special
23    account, separate and apart from personal and other
24    business accounts, all escrow moneys belonging to others
25    entrusted to a licensee while acting as a real estate
26    broker, escrow agent, or temporary custodian of the funds

 

 

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1    of others or failure to maintain all escrow moneys on
2    deposit in the account until the transactions are
3    consummated or terminated, except to the extent that the
4    moneys, or any part thereof, shall be:
5            (A) disbursed prior to the consummation or
6        termination (i) in accordance with the written
7        direction of the principals to the transaction or their
8        duly authorized agents, (ii) in accordance with
9        directions providing for the release, payment, or
10        distribution of escrow moneys contained in any written
11        contract signed by the principals to the transaction or
12        their duly authorized agents, or (iii) pursuant to an
13        order of a court of competent jurisdiction; or
14            (B) deemed abandoned and transferred to the Office
15        of the State Treasurer to be handled as unclaimed
16        property pursuant to the Uniform Disposition of
17        Unclaimed Property Act. Escrow moneys may be deemed
18        abandoned under this subparagraph (B) only: (i) in the
19        absence of disbursement under subparagraph (A); (ii)
20        in the absence of notice of the filing of any claim in
21        a court of competent jurisdiction; and (iii) if 6
22        months have elapsed after the receipt of a written
23        demand for the escrow moneys from one of the principals
24        to the transaction or the principal's duly authorized
25        agent.
26    The account shall be noninterest bearing, unless the

 

 

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1    character of the deposit is such that payment of interest
2    thereon is otherwise required by law or unless the
3    principals to the transaction specifically require, in
4    writing, that the deposit be placed in an interest bearing
5    account.
6        (18) Failure to make available to the Department all
7    escrow records and related documents maintained in
8    connection with the practice of real estate within 24 hours
9    of a request for those documents by Department personnel.
10        (19) Failing to furnish copies upon request of
11    documents relating to a real estate transaction to a party
12    who has executed that document.
13        (20) Failure of a sponsoring broker to timely provide
14    information, sponsor cards, or termination of licenses to
15    the Department.
16        (21) Engaging in dishonorable, unethical, or
17    unprofessional conduct of a character likely to deceive,
18    defraud, or harm the public.
19        (22) Commingling the money or property of others with
20    his or her own money or property.
21        (23) Employing any person on a purely temporary or
22    single deal basis as a means of evading the law regarding
23    payment of commission to nonlicensees on some contemplated
24    transactions.
25        (24) Permitting the use of his or her license as a
26    broker to enable a salesperson or unlicensed person to

 

 

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1    operate a real estate business without actual
2    participation therein and control thereof by the broker.
3        (25) Any other conduct, whether of the same or a
4    different character from that specified in this Section,
5    that constitutes dishonest dealing.
6        (26) Displaying a "for rent" or "for sale" sign on any
7    property without the written consent of an owner or his or
8    her duly authorized agent or advertising by any means that
9    any property is for sale or for rent without the written
10    consent of the owner or his or her authorized agent.
11        (27) Failing to provide information requested by the
12    Department, or otherwise respond to that request, within 30
13    days of the request.
14        (28) Advertising by means of a blind advertisement,
15    except as otherwise permitted in Section 10-30 of this Act.
16        (29) Offering guaranteed sales plans, as defined in
17    clause (A) of this subdivision (29), except to the extent
18    hereinafter set forth:
19            (A) A "guaranteed sales plan" is any real estate
20        purchase or sales plan whereby a licensee enters into a
21        conditional or unconditional written contract with a
22        seller, prior to entering into a brokerage agreement
23        with the seller, by the terms of which a licensee
24        agrees to purchase a property of the seller within a
25        specified period of time at a specific price in the
26        event the property is not sold in accordance with the

 

 

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1        terms of a brokerage agreement to be entered into
2        between the sponsoring broker and the seller.
3            (B) A licensee offering a guaranteed sales plan
4        shall provide the details and conditions of the plan in
5        writing to the party to whom the plan is offered.
6            (C) A licensee offering a guaranteed sales plan
7        shall provide to the party to whom the plan is offered
8        evidence of sufficient financial resources to satisfy
9        the commitment to purchase undertaken by the broker in
10        the plan.
11            (D) Any licensee offering a guaranteed sales plan
12        shall undertake to market the property of the seller
13        subject to the plan in the same manner in which the
14        broker would market any other property, unless the
15        agreement with the seller provides otherwise.
16            (E) The licensee cannot purchase seller's property
17        until the brokerage agreement has ended according to
18        its terms or is otherwise terminated.
19            (F) Any licensee who fails to perform on a
20        guaranteed sales plan in strict accordance with its
21        terms shall be subject to all the penalties provided in
22        this Act for violations thereof and, in addition, shall
23        be subject to a civil fine payable to the party injured
24        by the default in an amount of up to $25,000.
25        (30) Influencing or attempting to influence, by any
26    words or acts, a prospective seller, purchaser, occupant,

 

 

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1    landlord, or tenant of real estate, in connection with
2    viewing, buying, or leasing real estate, so as to promote
3    or tend to promote the continuance or maintenance of
4    racially and religiously segregated housing or so as to
5    retard, obstruct, or discourage racially integrated
6    housing on or in any street, block, neighborhood, or
7    community.
8        (31) Engaging in any act that constitutes a violation
9    of any provision of Article 3 of the Illinois Human Rights
10    Act, whether or not a complaint has been filed with or
11    adjudicated by the Human Rights Commission.
12        (32) Inducing any party to a contract of sale or lease
13    or brokerage agreement to break the contract of sale or
14    lease or brokerage agreement for the purpose of
15    substituting, in lieu thereof, a new contract for sale or
16    lease or brokerage agreement with a third party.
17        (33) Negotiating a sale, exchange, or lease of real
18    estate directly with any person if the licensee knows that
19    the person has an exclusive brokerage agreement with
20    another broker, unless specifically authorized by that
21    broker.
22        (34) When a licensee is also an attorney, acting as the
23    attorney for either the buyer or the seller in the same
24    transaction in which the licensee is acting or has acted as
25    a broker or salesperson.
26        (35) Advertising or offering merchandise or services

 

 

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1    as free if any conditions or obligations necessary for
2    receiving the merchandise or services are not disclosed in
3    the same advertisement or offer. These conditions or
4    obligations include without limitation the requirement
5    that the recipient attend a promotional activity or visit a
6    real estate site. As used in this subdivision (35), "free"
7    includes terms such as "award", "prize", "no charge", "free
8    of charge", "without charge", and similar words or phrases
9    that reasonably lead a person to believe that he or she may
10    receive or has been selected to receive something of value,
11    without any conditions or obligations on the part of the
12    recipient.
13        (36) Disregarding or violating any provision of the
14    Land Sales Registration Act of 1989, the Illinois Real
15    Estate Time-Share Act, or the published rules promulgated
16    by the Department to enforce those Acts.
17        (37) Violating the terms of a disciplinary order issued
18    by the Department.
19        (38) Paying or failing to disclose compensation in
20    violation of Article 10 of this Act.
21        (39) Requiring a party to a transaction who is not a
22    client of the licensee to allow the licensee to retain a
23    portion of the escrow moneys for payment of the licensee's
24    commission or expenses as a condition for release of the
25    escrow moneys to that party.
26        (40) Disregarding or violating any provision of this

 

 

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1    Act or the published rules promulgated by the Department to
2    enforce this Act or aiding or abetting any individual,
3    partnership, registered limited liability partnership,
4    limited liability company, or corporation in disregarding
5    any provision of this Act or the published rules
6    promulgated by the Department to enforce this Act.
7        (41) Failing to provide the minimum services required
8    by Section 15-75 of this Act when acting under an exclusive
9    brokerage agreement.
10        (42) Habitual or excessive use or addiction to alcohol,
11    narcotics, stimulants, or any other chemical agent or drug
12    that results in a managing broker, broker, salesperson, or
13    leasing agent's inability to practice with reasonable
14    skill or safety.
15    (b) The Department may refuse to issue or renew or may
16suspend the license of any person who fails to file a return,
17pay the tax, penalty or interest shown in a filed return, or
18pay any final assessment of tax, penalty, or interest, as
19required by any tax Act administered by the Department of
20Revenue, until such time as the requirements of that tax Act
21are satisfied in accordance with subsection (g) of Section
222105-15 of the Civil Administrative Code of Illinois.
23    (c) The Department shall deny a license or renewal
24authorized by this Act to a person who has defaulted on an
25educational loan or scholarship provided or guaranteed by the
26Illinois Student Assistance Commission or any governmental

 

 

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1agency of this State in accordance with item (5) of subsection
2(g) of Section 2105-15 of the Civil Administrative Code of
3Illinois.
4    (d) In cases where the Department of Healthcare and Family
5Services (formerly Department of Public Aid) has previously
6determined that a licensee or a potential licensee is more than
730 days delinquent in the payment of child support and has
8subsequently certified the delinquency to the Department may
9refuse to issue or renew or may revoke or suspend that person's
10license or may take other disciplinary action against that
11person based solely upon the certification of delinquency made
12by the Department of Healthcare and Family Services in
13accordance with item (5) of subsection (g) of Section 2105-15
14of the Civil Administrative Code of Illinois.
15    (e) In enforcing this Section, the Department or Board upon
16a showing of a possible violation may compel an individual
17licensed to practice under this Act, or who has applied for
18licensure under this Act, to submit to a mental or physical
19examination, or both, as required by and at the expense of the
20Department. The Department or Board may order the examining
21physician to present testimony concerning the mental or
22physical examination of the licensee or applicant. No
23information shall be excluded by reason of any common law or
24statutory privilege relating to communications between the
25licensee or applicant and the examining physician. The
26examining physicians shall be specifically designated by the

 

 

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1Board or Department. The individual to be examined may have, at
2his or her own expense, another physician of his or her choice
3present during all aspects of this examination. Failure of an
4individual to submit to a mental or physical examination, when
5directed, shall be grounds for suspension of his or her license
6until the individual submits to the examination if the
7Department finds, after notice and hearing, that the refusal to
8submit to the examination was without reasonable cause.
9    If the Department or Board finds an individual unable to
10practice because of the reasons set forth in this Section, the
11Department or Board may require that individual to submit to
12care, counseling, or treatment by physicians approved or
13designated by the Department or Board, as a condition, term, or
14restriction for continued, reinstated, or renewed licensure to
15practice; or, in lieu of care, counseling, or treatment, the
16Department may file, or the Board may recommend to the
17Department to file, a complaint to immediately suspend, revoke,
18or otherwise discipline the license of the individual. An
19individual whose license was granted, continued, reinstated,
20renewed, disciplined or supervised subject to such terms,
21conditions, or restrictions, and who fails to comply with such
22terms, conditions, or restrictions, shall be referred to the
23Secretary for a determination as to whether the individual
24shall have his or her license suspended immediately, pending a
25hearing by the Department.
26    In instances in which the Secretary immediately suspends a

 

 

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1person's license under this Section, a hearing on that person's
2license must be convened by the Department within 30 days after
3the suspension and completed without appreciable delay. The
4Department and Board shall have the authority to review the
5subject individual's record of treatment and counseling
6regarding the impairment to the extent permitted by applicable
7federal statutes and regulations safeguarding the
8confidentiality of medical records.
9    An individual licensed under this Act and affected under
10this Section shall be afforded an opportunity to demonstrate to
11the Department or Board that he or she can resume practice in
12compliance with acceptable and prevailing standards under the
13provisions of his or her license.
14(Source: P.A. 95-851, eff. 1-1-09; 96-856, eff. 12-31-09.)