JAMES MICHAEL BANKS (Raleigh) – By Consent, the Commission reprimanded Mr. Banks effective January 1, 2017. The Commission found that Mr. Banks, acting as the listing agent for the sale of a single-family residence, represented to his buyer that repairs were complete when the potential buyer discovered that repairs had not, in fact, been made prior to closing.
WANDA T. CANADY (Wallace) – By Consent, the Commission permanently revoked the broker license of Ms. Canady effective December 14, 2016. The Commission found that Ms. Canady, acting as the qualifying broker and broker-in-charge of a licensed real estate firm engaged in property management, failed to provide all of the requested trust account documentation requested by the Commission, failed to perform trust account reconciliations, failed to maintain a general ledger, and failed to maintain a trust account journal; that Ms. Canady could not account for all rents and security deposits received by the firm and failed to deposit all rent payments and security deposits received in cash into the trust account; and that Ms. Canady admitted to spending entrusted funds on expenses, other than for which the funds were intended, which led to deficit spending and a shortage in excess of $80,000 in the trust account
JOSEPH TREVOR CHERRY (Charlotte) – By Consent, the Commission suspended the broker license of Mr. Cherry for a period of 24 months effective September 1, 2016. The Commission found that Mr. Cherry, acting as the broker-in-charge and qualifying broker of a licensed real estate brokerage firm, managed a property (“property A”) from which he collected from the tenant $295 extra each month in rent and $100 each month for use of the washer and dryer from the tenant without the knowledge of the owner landlord; that Mr. Cherry charged the owner landlord for repairs made to the dryer and did not receive approval from owner landlord for repairs exceeding $150, in violation of the management agreement; that Mr. Cherry also managed four properties for another landlord owner (“property B”) and spent in excess of $250 on repairs without receiving approval from landlord owner, in violation of the management agreement; that Mr. Cherry was paid twice for some repairs that were already paid; and failed to give an accounting to the landlord owner within the time required by the management agreement; that an audit discovered that Mr. Cherry failed to maintain all records as required by Commission rules and evidence of deficit spending and comingling of funds in his firm’s trust accounts; and that Mr. Cherry failed to deposit cash into a trust account within three banking days of receipt. The Commission notes that Mr. Cherry’s trust accounts are now fully funded.
DOROTHY M. COLESTOCK (Murphy) – By Consent, the Commission suspended the broker license of Ms. Colestock for a period of 12 months effective November 1, 2016. The Commission then stayed the suspension for a probation period from November 1, 2016 through October 31, 2017. The Commission found that Ms. Colestock, acting as the qualifying broker and broker-in-charge of a licensed real estate brokerage firm, had posting errors in the firm’s trust account software accounting system going as far back as 2006 that were never corrected; that this caused an inaccurate set of books which led to deficit spending on at least two occasions; that Ms. Colestock’s firm managed both long term rentals as well as vacation rentals, yet did not maintain a subsidiary ledger for those accounts; that no personal funds ledger was used to account for funds used to cover bank service charges; and that Ms. Colestock acted as a dual agent in one transaction, but was unable to provide a copy of the buyer agency agreement to Commission staff. The Commission notes that no evidence of a shortage was found in the accounts and Ms. Colestock’s firm has transferred all of its remaining rentals to another licensed firm and that Ms. Colestock has affiliated with another licensed firm to engage solely in sales transactions.
JONATHAN H. ELLIOT (Fayetteville) – Following a hearing, the Commission permanently revoked the broker license of Mr. Elliot effective December 1, 2016. The Commission found that Mr. Elliot, acting as broker-in-charge of a sole proprietorship, failed to respond to Letters of Inquiry sent by the Commission; that Mr. Elliot failed to provide owner ledgers for the properties he was managing, copies of cancelled checks, or a trial balance; that Mr. Elliot paid “bonus” checks based on 25% of the total rent payments mandated in leases to an unlicensed company as compensation for getting leases signed by tenants; that Mr. Elliot failed to list a property for sale for the owner as required under the listing agreement and placed a tenant in the subject property without the knowledge of the property owner; that Mr. Elliot collected rent from the tenant monthly for over two years and placed this money in his trust account; that Mr. Elliot never disbursed this money to the property owner and the balance owed to the owners in this account ballooned to over $20,000; that Mr. Elliot did not have a property management agreement with the owner; that the owner was unaware of a tenant being in the property because Mr. Elliot failed to provide owner statements during the tenancy and failed to provide the owner with a copy of the lease; that checks written on the trust account failed to identify the subject property, property owner, and the purpose for the disbursement; that Mr. Elliot failed to maintain copies of the canceled checks and the deposit slips failed to identify the purpose for the deposit; that Mr. Elliot failed to maintain a personal funds ledger and the account lacked an audit trail; that Mr. Elliot’s previously licensed firm was administratively dissolved by the North Carolina Secretary of State on July 21, 2011 and that Mr. Elliot failed to notify the Commission of this and the firm continued to operate until October 1, 2015, when the firm’s license was cancelled by the Commission; and that Mr. Elliot declared himself broker-in-charge of a sole proprietorship under the same name as the formerly licensed firm.
MITCHELL LEE EUDY (Charlotte) – By Consent, the Commission suspended the broker license of Mr. Eudy for a period of five months effective November 1, 2016. The Commission then stayed the suspension for a probationary period until March 31, 2017. The Commission found that Mr. Eudy, on May 27, 2015, entered into an Exclusive Right to Sell listing agreement for a property; that the listed property contained a small cemetery and Mr. Eudy was aware at the time of the listing agreement that there was a cemetery located on the property; that Mr. Eudy failed to disclose the cemetery to potential buyers of the property; that Mr. Eudy asserts that he directed the sellers to inform the buyers of the existence of the cemetery; and, the buyers assert that they were not made aware of the cemetery prior to closing.
FREEDOM REALTY INC. (Murphy) – By Consent, the Commission suspended the firm license of Freedom Realty for a period of 12 months effective November 1, 2016. The Commission then stayed the suspension for a probationary period from November 1, 2016 through October 31, 2017. The Commission found that Freedom Realty had posting errors in the trust account software accounting system going as far back as 2006 that were never corrected; that this caused an inaccurate set of books which led to deficit spending on at least two occasions; that Freedom Realty managed both long term rentals as well as vacation rentals, yet a subsidiary ledger for those accounts was not maintained; that no personal funds ledger was used to account for funds used to cover bank service charges; and that Freedom Realty acted as a dual agent in one transaction, but was unable to provide a copy of the buyer agency agreement to Commission staff. The Commission notes that no evidence of a shortage was found in the accounts and that the firm has transferred all of its remaining rentals to another licensed firm and that Broker has affiliated with another licensed firm to engage solely in sales transactions.
CHARLES LESLIE GIEZENTANNER III (Asheville) – By Consent, the Commission suspended the broker license of Mr. Giezentanner for a period of one month effective January 1, 2017. The Commission found that, on June 29, 2016, Mr. Giezentanner was convicted of a Level 2 DWI and DWLR After Impaired Revocation Notice; that Mr. Giezentanner failed to report the conviction; and that Mr. Giezentanner failed to respond to three Letters of Inquiry.
GOLDEN KEY REALTY INC d/b/a RCA REALTY (Wallace) – By Consent, the Commission permanently revoked the firm license of Golden Key Realty effective December 14, 2016. The Commission found that Golden Key Realty, engaged in property management, failed to provide all of the requested trust account documentation requested by the Commission, failed to perform trust account reconciliations, failed to maintain a general ledger, and failed to maintain a trust account journal; that Golden Key Realty could not account for all rents and security deposits it received and failed to deposit all rent payments and security deposits received in cash into the trust account; and that Golden Key Realty’s broker-in-charge admitted to spending entrusted funds on expenses, other than for which the funds were intended, which led to deficit spending and a shortage in excess $80,000 in the firm’s trust account.
PATRICIA OLIVIA GONZALEZ (Fayetteville) – By Consent, the Commission suspended the broker license of Ms. Gonzalez for a period of 18 months effective September 1, 2016. The Commission found that Ms. Gonzalez, acting as broker-in-charge and qualifying broker of her firm, failed to perform monthly reconciliations of her firm’s trust accounts and that one trust account was overdrawn twice in 2014, indicating a shortage; that Ms. Gonzalez was unable to produce the ledgers for individual properties and/or property owners, despite multiple requests; and that Ms. Gonzalez’ firm was administratively dissolved by the North Carolina Department of the Secretary of State in September 2015 and Ms. Gonzalez failed to notify the Commission.
KEVIN J. MCVICKER (Durham) – By Consent, the Commission reprimanded Mr. McVicker effective December 1, 2016. The Commission found that Mr. McVicker, in 2015, was affiliated with a licensed firm for which his wife was broker-in-charge/qualifying broker; that in August 2015, the firm and Mr. McVicker’s wife were revoked by Consent by the Commission for, among other things, failure to maintain funds in a trust account, conversion of trust monies, and failure to provide transaction records to a Commission representative; that during the investigation bank records obtained by a subpoena showed trust monies and rents were deposited into a personal account held by Mr. McVicker and his wife and that Mr. McVicker wrote checks for personal expenses from the same account; that Mr. McVicker submitted a new firm application, designating himself as a broker-in-charge on the same day that his firm’s broker license was revoked; and that Mr. McVicker agreed to supply transaction and account records but failed to do so in a timely manner.
PATRICK KEVIN MONAGHAN (Charlotte) – By Consent, the Commission suspended the broker license of Mr. Monaghan for a period of four months effective November 1, 2016. The Commission then stayed the suspension for a probationary period ending March 1, 2017. The Commission found that in May 2015 Mr. Monaghan, acting as the broker-in-charge of Northpoint Asset Management, entered into a residential property management agreement for property; that according to the agreement, the monthly rent was to be $1000; that in July 2015, Mr. Monaghan procured tenants who agreed to rent the property for $140/month and, in exchange for the low rent, perform renovations, a violation of North Carolina Landlord and Tenant Law; that the lease contained no description of the work tenants were to complete in exchange for the lower rent; that the lease provided by Mr. Monaghan included a late fee beyond the statutory limit; that Mr. Monaghan collected a security deposit in excess of the statutory limit; that an addendum to the lease permitted Mr. Monaghan to use tenants’ security deposit for costs not permitted and allowed the tenant security deposit to be disbursed during the tenancy in violation of Landlord and Tenant Law; and that Mr. Monaghan failed to inform the tenants and property owner which bank held the security deposit.
NORTHPOINT ASSET MANAGEMENT LLC (Charlotte) – By Consent, the Commission suspended the firm license of Northpoint Asset Management for a period of four months effective November 1, 2016. The Commission then stayed the suspension for a probationary period ending March 1, 2017. The Commission found that Northpoint Asset Management in May 2015, entered into a residential property management agreement for property located in Charlotte, NC; that according to the agreement, the monthly rent was to be $1000; that in July 2015, Northpoint Asset Management procured tenants who agreed to rent the property for $140/month and, in exchange for the low rent, perform renovations, a violation of North Carolina Landlord and Tenant Law; that the lease contained no description of the work tenants were to complete in exchange for the lower rent; that the lease provided by Northpoint Asset Management included a late fee beyond the statutory limit; that Northpoint Asset Management collected a security deposit in excess of the statutory limit; that an addendum to the lease permitted Northpoint Asset Management to use tenants’ security deposit for costs and allowed the tenant security deposit to be disbursed during the tenancy in violation of Landlord and Tenant Law; that Northpoint Asset Management failed to inform the tenants and property owner which bank held the security deposit.
CHRISTINA L. PITZ (Surf City) – By Consent, the Commission reprimanded Ms. Pitz effective January 2, 2017. The Commission found that Ms. Pitz, acting as a listing agent, failed to obtain a copy of a septic permit to verify the number or bedrooms allowed by the septic system despite being informed that her seller-clients did not know whether the septic system was permitted as a four-bedroom house; that the buyers closed on the house under the impression it was permitted as a four-bedroom house instead of a three-bedroom house; and that the buyers discovered the discrepancy while performing remodeling work on the house and had to purchase a septic system to accommodate four-bedroom house. The Commission noted that Ms. Pitz has reached a settlement with the buyers for an undisclosed sum.
PROPERTY ADMINISTRATORS, INC. (Greensboro) – By Consent, the Commission suspended the firm license of Property Administrators for a period of 18 months effective September 30, 2016. The Commission found that Property Administrators failed to prepare monthly reconciliations and failed to maintain ledgers and deposits in full compliance with Commission rules such that a clear audit trail could not be determined; and, that an audit of both trust accounts was performed and showed overages in both accounts.
RSK MOUNTAIN RESORT LLC (Blowing Rock) – By Consent, the Commission suspended the firm license of RSK Mountain Resort for a period of 36 months effective January 1, 2017. The Commission found that RSK Mountain Resort changed its legal name, but failed to notify the Commission; that from 1999 to 2016, RSK Mountain Resort operated under a name other than the name on its license; that RSK Mountain Resort regularly deposited trust money belonging to others into its operating account; that RSK Mountain Resort did not enter or maintain proper agency agreements in both sales and property management transactions; that RSK Mountain Resort failed to provide vacation rental agreements to tenants; and failed to maintain its trust account records in compliance with the Real Estate License Law and Commission Rules.
KATIE ELIZABETH SINGLETON (Surf City) – By Consent, the Commission reprimanded Ms. Singleton effective October 13, 2016. The Commission found that Ms. Singleton was convicted in district court of Level III DWI on June 30, 2016, and was sentenced to 12 months of supervised probation and required to complete 72 hours of community service. The Commission noted that Ms. Singleton timely reported the conviction to the Commission and is in compliance with the court’s order.
KARYN B. SPREEMAN (Hendersonville) – By Consent, the Commission suspended the broker license of Ms. Spreeman for the period of 18 months effective December 1, 2016. Two months of the suspension shall be active with the remainder stayed for a probationary period from February 1, 2017 through June 1, 2018. The Commission found that Ms. Spreeman listed a vacant lot for sale under a listing agreement which expired on July 31, 2015; that on September 9, 2015, Ms. Spreeman submitted an offer to purchase the lot, on behalf of a prospective buyer, to the seller; that Ms. Spreeman told her buyer client that the seller verbally accepted the offer and sent the offer in the mail to the seller for signature; that the seller claims she never verbally accepted the offer; that on September 8, 2015, Ms. Spreeman signed the seller’s name on a document which gave the buyer authorization to obtain septic and/or well permits on behalf of the seller; that Ms. Spreeman did not have written authorization from the seller or a power of attorney document allowing her to sign on the seller’s behalf; that the seller’s land was then clear cut and permits were pulled by the buyers; and that the seller later rejected the buyer’s offer and the company that performed the work, on the buyer’s behalf, filed a lien against seller for over $7,000. The Commission notes that Ms. Spreeman has paid the lien which has now been released.
KENNETH L. TARBUTTON (Blowing Rock) – By Consent, the Commission suspended the broker license of Mr. Tarbutton for a period of 36 months effective January 1, 2017. The Commission found that Mr. Tarbutton, acting as the qualifying broker and broker-in-charge of a licensed real estate brokerage firm, changed the legal name of the firm, but failed to notify the Commission; that from 1999 to 2016, the firm operated under a name other than the name on its license; that Mr. Tarbutton acted as the broker-in-charge of two offices, his sales office and rental management office, that were not in the same physical location; that Mr. Tarbutton regularly deposited trust money belonging to others into his firm’s operating account; that Mr. Tarbutton did not enter or maintain proper agency agreements in both sales and property management transactions; that Mr. Tarbutton failed to provide vacation rental agreements to tenants; and failed to maintain his firm’s trust account records in compliance with the Real Estate License Law and Commission Rules.
ROBERT CRAIG THRIFT, JR. (New Bern) – The Commission accepted the voluntary surrender of the broker license of Mr. Thrift for a period of 10 years effective November 9, 2016. The Commission dismissed without prejudice allegations that Mr. Thrift violated the Real Estate License Law and Commission rules. Mr. Thrift neither admitted nor denied misconduct.
RICHARD TOCADO (Charlotte) – By Consent, the Commission suspended the broker license of Mr. Tocado for a period of one month effective October 1, 2016. The Commission found that Mr. Tocado, in and around 2014, acted as a buyer agent in a new construction real estate transaction; that Mr. Tocado, in order to secure the transaction, offered to rebate $3,000 of his commission to the buyer-client; that Mr. Tocado disclosed the rebate to the original lender, but failed to disclose it to the second lender until the day of closing, which would delay the closing by three days; that rather than delay closing, Mr. Tocado and the buyer-client agreed that Mr. Tocado would donate the $3,000 to the buyer-client’s favorite charity; and that after closing, Mr. Tocado failed to make the agreed donation.
TREVOR CHERRY REAL ESTATE LLC (Charlotte) – By Consent, the Commission suspended the firm license of Trevor Cherry Real Estate for a period of 24 months effective September 1, 2016. The Commission then stayed the suspension for a probationary period from September 1, 2016 through August 31, 2018. The Commission found that Trevor Cherry Real Estate managed a property (“property A”) from which it collected from the tenant $295 extra each month in rent and $100 each month for use of the washer and dryer from the tenant without the knowledge of the owner landlord; that Trevor Cherry Real Estate charged the owner landlord for repairs made to the dryer and did not receive approval from owner landlord for repairs exceeding $150, in violation of the management agreement; that Trevor Cherry Real Estate also managed four properties for another landlord owner (“property B”) and spent in excess of $250 on repairs without receiving approval from landlord owner, in violation of the management agreement; that Trevor Cherry Real Estate was paid twice for some repairs that were already paid; and failed to give an accounting to the landlord owner within the time required by the management agreement; that an audit discovered that Trevor Cherry Real Estate failed to maintain all records as required by Commission rules and evidence of deficit spending and comingling of funds in its trust accounts; and that Trevor Cherry Real Estate failed to deposit cash into a trust account within three banking days of receipt. The Commission notes that Trevor Cherry Real Estate’s trust accounts are now fully funded.
DAVID J. WELSH (Boone) – The Commission accepted the voluntary surrender of the broker license of Mr. Welsh for a period one year effective December 14, 2016. The Commission dismissed without prejudice allegations that Mr. Welsh violated Commission rules and the Real Estate License Law. Mr. Welsh neither admitted nor denied misconduct.
MARY S. WILSON (Greensboro) – By Consent, the Commission suspended the broker license of Ms. Wilson for a period of 18 months effective September 30, 2016. The Commission then stayed the suspension on certain conditions. The Commission found that Ms. Wilson, acting as broker-in-charge of a licensed real estate brokerage firm, failed to prepare monthly reconciliations and failed to maintain ledgers and deposits in full compliance with Commission rules such that a clear audit trail could not be determined; and that an audit of both trust accounts was performed and showed overages in both accounts.
This article came from the February 2017-Vol47-3 edition of the bulletin.