III. Trust Account Management
Exceptions To Depositing Remuneration Into A Brokerage Trust Account
Section 27(4.1) of RESA and section 5-15.1 of the Rules creates an exception to the requirement that all funds received by a brokerage must be placed in the brokerage’s trust account. It provides that remuneration that has already been earned, in accordance with the rules, is not required to be paid into either the brokerage trust account or commission trust account if none of the remuneration is payable to another brokerage or a related licensee. Under such circumstances, the remuneration may be paid into the brokerage’s general account or any other account designated by the brokerage.
If the remuneration has been earned and is payable to a related licensee, the remuneration may be paid directly to a commission trust account as long as none of the remuneration is payable to another brokerage. See “Payment of Licensee Remuneration” in 5(a) below for an explanation of when funds are considered earned.
Section 5-15.1 of the Rules sets out additional circumstances when remuneration is considered to be earned for the purposes of depositing the funds into an account other than the brokerage trust account.
As a result of section 5-15.1 of the Rules, remuneration is not required to be deposited in a brokerage trust account if the remuneration is received from a person other than a principal and, in the case of remuneration related to trading services, would be considered to be earned in the same circumstance as if the funds were held by the brokerage as a “stakeholder”.
If the remuneration is received from a person other than a principal, on account of rental property management or strata management services, it may be considered earned either after the services have been provided, or at some other time agreed to in writing by the person paying the money to the brokerage.