Ariz. Admin. Code § 20-4-1505

Current through Register Vol. 30, No. 37, September 13, 2024

Section R20-4-1505 - Trust Account

A. A licensee that maintains an office in Arizona shall deposit all funds collected for a client in a trust account at a federally insured depository institution in Arizona. A licensee that does not maintain an office in Arizona shall deposit all funds collected for a client in a trust account at a federally insured depository institution in the state where the licensee maintains its principal office. A licensee shall deposit all client funds before the close of its business on the third business day after the licensee receives the funds. Client funds shall remain on deposit as required by this Section until:

1. Paid over to a client, or

2. Otherwise paid as provided in this Section.

B. A licensee shall pay funds from the trust account either:

1. By prenumbered printed checks, or

2. By electronic payment.

C. A licensee shall deposit in its trust account only the funds it has collected for its client. A licensee, its officers, directors, partners, managers, members, or employees shall not commingle, or permit the commingling of, their own funds with client funds. This prohibition includes any funds that a licensee, or any officer, director, partner, manager, member, or employee claims an interest in if that interest arises outside the licensee's contract with a client.

D. A licensee shall keep unpaid client funds in its trust account. A licensee may maintain a separate trust account for dormant accounts into which the licensee deposits unpaid funds such as those of a client that cannot be located, or any trust account check issued to a client that is returned without being negotiated. As to all those unpaid funds, under A.R.S. § 44-307, a licensee shall file an abandoned property report at the Arizona Department of Revenue as and when required by law.

E. A licensee shall withdraw from its trust account all fees and commissions due the licensee under its contract with a client and deposit them directly into its own operating account.

F. A licensee shall not pay funds from its trust account except as:

1. Provided in this Section,

2. Expressly authorized in its contract with a client, or

3. Authorized in writing by the Director.

Ariz. Admin. Code § R20-4-1505

Adopted effective December 18, 1979 (Supp. 79-6). R20-4-1505recodified from R4-4-1505 (Supp. 95-1). Amended by final rulemaking at 6 A.A.R. 4742, effective November 13, 2000 (Supp. 00-4). Amended by final rulemaking at 29 A.A.R. 1961, effective 10/2/2023.