OAR 441-175-0050: Rules of Fair Practice for Real Estate Licensees

Any real estate broker relying on exclusions in OAR 441-175-0020, 441-175-0030 or 441-175-0040 must comply with the following rules of fair practice: (1) All advertising involving securities registered under ORS 59.065 and OAR chapter 441, division 65 must be filed with the director before the advertising is used. (2) All customer funds and securities must be segregated from those of the real estate broker, and: (a) All customer funds must be deposited in a client trust account which is free from all claims, attachment or levy by creditors of the real estate broker; and (b) All customer securities must be held in trust in a secure depository and the securities must be free from all claims, attachment or levy by creditors of the real estate broker. (3) The real estate broker must create and maintain the following books and records pertaining to securities activities for a period of six (6) years: (a) Records of all securities sales and purchases; (b) Investor information records; (c) Trust account transactions; (d) Discretionary account agreements; (e) Investor complaints and resolution; and (f) Financial information of the real estate broker. (4)(a) A real estate broker may not recommend a securities transaction to an investor unless the real estate broker has reviewed the terms of the transaction and has reasonable grounds to believe that the recommendation is suitable for the investor on the basis of information furnished by the investor, after reasonable inquiry is made by the real estate broker, concerning the investor's investment objectives, financial situation and any other information known to and deemed relevant by the real estate broker; (b) The requirements of subsection (a) of this section, except for the requirement to review the transaction, may be satisfied if the investment in fact is suitable for the particular investor; (c) A real estate broker who is selling securities registered under OAR 441-065-0060 through 441-065-0240 to "sophisticated purchasers" shall comply with the suitability requirements for such purchasers instead of the requirements of subsection (a) of this section. (5) The responsibility for supervision of all persons engaged by a real estate broker to effect securities transactions or render advisory services is that of the Principal Real Estate broker. Supervision includes reviewing and authorizing all securities activities engaged in by Real Estate Brokers affiliated with a Principal Real Estate Broker.