Commission Rule 58A .0110(g)(9) requires Brokers-in-Charge to complete the Commission’s Basic Trust Account Procedures Course within 120 days of assuming responsibility for a trust account provided they have not already completed the course within the previous three years. If the BIC never opens another trust account or assumes control of another one, they are not required to complete the course again.
Even so, BICs are encouraged to complete the course on a more routine basis. For the 2020-2021 license year, the mishandling of trust account funds resulted in almost 20% of all disciplinary actions. The Commission has since revamped its Basic Trust Account Procedures Course and now offers it through distance (self-paced online) delivery on our Online Training Portal (https://learn.ncrec.gov). While trust account issues have slowed, mismanagement of the funds of others remains an ongoing issue.
While all licensees must safeguard and protect the money and property of others entrusted to them, the ultimate responsibility to oversee and safeguard the monies of others passing through the office rests with the BIC. The BIC remains responsible for the trust account, even if they hire an assistant, accountant, or bookkeeper to assist with record-keeping. Brokers should be mindful of the fact that embezzlement can happen even with trusted bookkeepers or long-time employees, and it is made easier when there is no oversight of their activity.
Since the responsibility ultimately falls on the Broker-in-Charge, it is in their best interest to maintain a working knowledge of how to properly maintain a trust account. BICs who complete the course will, at a minimum, learn what they need to know to adequately supervise their bookkeeper and what the software program needs to be able to produce in the way of reports in order to be compliant. As a bonus, it also qualifies as an elective continuing education course.
Whether a Broker-in-Charge personally maintains their brokerage’s trust account or delegates that responsibility to others, it is essential they maintain an active working knowledge of the rule requirements regarding the handling and reconciliation of funds in that trust account. Even if a BIC is in compliance with the minimum requirement to complete the Basic Trust Account Procedures Course once, it is highly recommended they regularly review and complete the course in order to ensure the safeguarding of their clients’ money and for the protection of their own business.