Key Takeaways
- SCREC can investigate complaints, conduct hearings, and impose disciplinary actions
- Violations can result in license denial, suspension, revocation, or fines
- Common violations include misrepresentation, trust account violations, unlicensed activity, and disclosure failures
- Practicing without a license is a criminal misdemeanor in South Carolina
- Licensees have due process rights including notice and hearing before disciplinary action
Last updated: January 2026
License Law Violations & Discipline
SCREC has authority to investigate complaints and take disciplinary action against licensees who violate the South Carolina Real Estate License Law (Title 40, Chapter 57).
Common Violations
Misrepresentation and Fraud
| Violation | Description |
|---|---|
| Material misrepresentation | False statements about important facts |
| Omission | Failing to disclose known material defects |
| Fraud | Intentional deception for personal gain |
| False advertising | Misleading marketing or claims |
Trust Account Violations
| Violation | Description |
|---|---|
| Commingling | Mixing client and broker funds |
| Conversion | Using client funds without authorization |
| Failure to deposit | Not depositing funds within required timeline |
| Poor records | Inadequate documentation or reconciliation |
| Shortage | Trust account balance less than owed |
Agency and Disclosure Violations
| Violation | Description |
|---|---|
| Failure to disclose brokerage relationship | Not providing required disclosure form |
| Undisclosed dual agency | Acting for both parties without consent |
| Breach of fiduciary duty | Violating duties to clients |
| Undisclosed interest | Failing to disclose personal interest |
| Property disclosure failure | Not providing or falsifying property disclosure |
Unlicensed Activity
| Violation | Description |
|---|---|
| Practicing without license | Performing activities requiring a license |
| Practicing on expired license | Continuing to work after expiration |
| Paying unlicensed persons | Compensating unlicensed individuals for licensed activities |
Warning: Practicing real estate without a license is a criminal misdemeanor in South Carolina, punishable by fine and/or imprisonment.
Other Common Violations
| Violation | Description |
|---|---|
| Failure to supervise | BIC not properly supervising associates |
| Advertising violations | Improper or misleading advertising |
| Failing to provide documents | Not giving copies of signed documents |
| Criminal conviction | Certain crimes affect license eligibility |
Disciplinary Process
Investigation
- Complaint filed with SCREC (or Commission initiates investigation)
- Investigation conducted by LLR staff
- Evidence gathered (documents, interviews, audits)
- Determination made whether to proceed with formal charges
Hearing Process
If SCREC proceeds with disciplinary action:
| Step | Description |
|---|---|
| Notice | Licensee notified of charges |
| Response | Licensee may respond to charges |
| Hearing | Formal hearing before panel or ALJ |
| Evidence | Both sides present evidence |
| Decision | Commission issues written decision |
| Appeal | Licensee may appeal to court |
Due Process Rights
Licensees have the right to:
- Notice of charges
- Hearing before adverse action
- Representation by attorney
- Present evidence and witnesses
- Cross-examine witnesses
- Appeal unfavorable decisions
Disciplinary Actions
SCREC may impose various sanctions:
| Action | Description |
|---|---|
| Denial | Refuse to issue or renew license |
| Reprimand | Formal written warning |
| Fine | Monetary penalty (up to $10,000 per violation) |
| Probation | Conditional license with restrictions |
| Suspension | Temporary loss of license |
| Revocation | Permanent loss of license |
| Additional education | Required courses |
Factors Considered
| Factor | Impact |
|---|---|
| Severity of violation | More serious = harsher penalty |
| Prior disciplinary history | Repeat violations = stricter |
| Harm to consumers | Consumer damage = more serious |
| Intent | Intentional vs. negligent conduct |
| Cooperation | Cooperation may reduce penalty |
| Rehabilitation | Remedial steps may help |
Criminal Penalties
Certain violations carry criminal penalties beyond license discipline:
| Violation | Criminal Penalty |
|---|---|
| Unlicensed practice | Misdemeanor; fine up to $5,000 and/or imprisonment |
| Conversion of trust funds | May be prosecuted for theft/embezzlement |
| Fraud | Criminal fraud charges possible |
Complaint Process for Consumers
Consumers can file complaints against licensees:
- File complaint with SCREC (online or mail)
- Provide documentation supporting the complaint
- Investigation conducted by Commission staff
- Resolution - dismissal, informal action, or formal charges
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Test Your Knowledge
Which action is a criminal misdemeanor in South Carolina?
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Test Your Knowledge
What is the maximum fine SCREC can impose per violation?
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Test Your Knowledge
What rights does a South Carolina licensee have before SCREC takes disciplinary action?
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Test Your Knowledge
Which is NOT a disciplinary action SCREC can impose?
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