Download the 2019 DMAR Report on the Colorado Real Estate Commission

DMAR engaged our firm to assist in analyzing the Colorado Real Estate Commission (CREC or the Commission) policy and regulatory issues, including an examination of investigations and discipline relating to the Colorado licensed real estate brokerage community, as well as current policy issues the Commission is facing.  In preparing this summary report, we’ve attended CREC meetings and reviewed CREC publications, disciplinary records from 2013 through 2018, including disciplinary stipulations, decisions by administrative law judges in broker cases and final agency orders issued by the Colorado Division of Real Estate.

Download report

Executive Summary

Broker disciplinary cases resolved in 2018 totaled 318. This number represents a slight decrease from the previous year which closed with 324 disciplinary resolved cases. This decline in disciplinary cases is likely linked, at least in part, to the slight decrease in the number of complaints against brokers in 2018 which totaled 1598 (compared to 1661 complaints in 2017). 

In 2018, 198 licensees faced discipline for failure to meet continuing educational requirements. This violation was by far the most common violation of license law for 2018 and has been for at least the last five years. Licensees should ensure compliance with continuing education requirements. Licensees should also be aware that the three-year compliance period for continuing education will soon change by ending on a calendar year rather than on each licensee’s individual license anniversary date. 

Trust accounting issues continue to be a problem for brokers, especially property managers. Given the severity of discipline meted out to non-compliant property management operations, it is important for brokerage firm owners and employing brokers to redouble efforts to ensure compliance with trust accounting obligations. 

For the last three years, the Commission has seen an increasing number of cases involving the failure to make appropriate brokerage disclosures in writing. Prior to undertaking any brokerage activities, licensees should make certain to either provide the appropriate brokerage disclosure form or secure an executed listing/exclusive right to buy contract and ensure that a copy of such form or contract is retained in the broker’s file.   

2018 also saw a record number of brokers disciplined for record retention issues. Both brokers and brokerages are advised to ensure they are retaining required records (discussed further below) for not less than the statutory four-year period. 

Table of Contents

• Executive Summary 
• Analysis of 2018 License Law Violations
  • Education Violations
  • Trust Accounting Violations
  • Brokerage Disclosures
  • Recordkeeping
  • Nondisclosure of Adverse Material Facts
• Commission Investigations and Audits
• Commission Discipline
• Commission Regulatory and Policy Issues
• • Revisions to Transaction Brokerage Relationships
  • Minimum Service Listings and “MLS Entry Only” Listings
  • Regulation of Teams
  • Scrutiny of Employing Brokers