The California Department of Real Estate has created a fund known as the Recovery Account (“Recovery Account”) to protect individuals who have been defrauded by real estate professionals licensed by the California Department of Real Estate arising out of any transaction in which the licensed individual was conducting licensed activity . This would include real estate brokers as well as real estate agents. The effect of the Recovery Account is to give consumers who have been defrauded by either their real estate broker or real estate agent to recover some or all of the money stolen by their real estate broker/agent from the Department of Real Estate.
If a consumer has been defrauded by their real estate broker or agent, and the real estate broker and/or the real estate agent that defrauded them is unable to pay restitution to the defrauded consumer, and the consumer has obtained a court judgment for the amount that the consumer was defrauded, a consumer can apply to the Department of Real Estate to be reimbursed some if not all of the amount that they had been defrauded but had been unable to collect from the real estate broker and/or real estate agent.
Under California Business and Professions Code sections 10471 et. seq., after obtaining a judgment for fraud perpetrated by a real estate broker or real estate agent, and attempting efforts to collect on that judgment unsuccessfully, a consumer can then apply to the Department of Real Estate to the Recovery Account of the Department of Real Estate to be reimbursed the unpaid amount of the loss up to $50,000.00 per instance, with a cap of $250,000.00 per licensed individual by the Department of Real Estate. [California Business and Professions Code section 10474].
The Recovery Account is a wonderful resource for individuals that have been defrauded by individuals licensed by the Department of Real Estate, including mortgage brokers. I have used the Recovery Account in the past as an effective resource for clients.
If you believe that you have been defrauded by a real estate broker, mortgage broker, or a real estate agent in the course of a transaction they handled for you, please feel free to contact me at (510) 465-0025 to arrange for a consultation to determine whether or not the Recovery Account would be available to assure recovery in your case.