1.1 Indiana Real Estate Commission (IREC) Overview

Start with the Right Regulator

The Indiana Real Estate Commission (IREC) operates within the Indiana Professional Licensing Agency (PLA). PLA supplies administrative support and the licensing system; the Commission exercises the powers the legislature gives it. Neither a brokerage association nor the Secretary of State replaces this licensing regulator.

The distinction matters on the state examination. Pearson's broker outline assigns 5 of 50 scored state items to the Commission domain, including its powers, investigations, hearings, sanctions and the Recovery Fund. That is a domain count, not a guarantee that five questions concern board membership or the fund alone. The full broker outlines specify 80 national and 50 state scored items, plus 5 national and 5-10 state pretest items. The handbook separately lists 145 total questions and 240 minutes for ReIN-Broker.

Use the current national study resource alongside the official broker outline. A national rule and an Indiana statutory exception can lead to different answers, so identify the jurisdiction before applying a memorized rule.

Statutes, Rules and Administrative Staff

The legislature grants authority; the Commission adopts rules within that authority. These sources can work together. For example, the 90-hour broker-course minimum appears in IC 25-34.1-5-5, while 876 IAC 6-4-1 supplies course requirements. Calling every course requirement solely a rule or solely an agency policy would miss that relationship.

The Actual 12-Position Composition

Current IC 25-34.1-2-1 creates the following composition, subject to the general appointment provisions it references:

That is 9 + 1 + 2 = 12, or 10 real estate members and 2 citizen members. It is not nine brokers plus three public members, and the statute does not impose an additional managing-broker seat requirement. All are appointed by the Governor. The current wording also does not require exactly one member from each congressional district. Read the current statute rather than importing an older district-allocation sentence.

The PLA Commission page publishes the current roster. A person's appointment date or holdover service is different from a licensee's renewal calendar; do not interchange those dates.

Discipline Is an Administrative Decision

IREC may inspect records, investigate within its statutory authority, hold hearings and impose authorized licensing sanctions. Under IC 25-1-11-12, sanctions may include censure, reprimand, probation, suspension, permanent revocation, and consumer restitution. Probation may require reports, limits on practice or approved education. A suspension need not be a short, fixed period; read the actual order before concluding that practice may resume.

The current general disciplinary statute distinguishes civil-penalty ceilings of $1,000 per violation for an individual and $5,000 per violation for a business entity, with its stated exception for a finding of incompetency due to a physical or mental disability. A ceiling is not a mandatory fine in every case. The Commission considers the practitioner's ability to pay as the statute directs.

How a Professional Complaint Proceeds

PLA's Report a Professional instructions identify the Attorney General as the initial reviewer of a consumer complaint. The Attorney General's Licensing Enforcement unit investigates professional-license complaints and decides whether to seek disciplinary action. If it files administrative charges, the state is the petitioner and the Commission or an appointed administrative law judge hears the case. A case may settle, so a contested evidentiary hearing is not inevitable.

After a hearing, the Commission makes findings and decides the authorized sanction, if any. Judicial review follows the applicable administrative-review procedure. The Attorney General's licensing unit represents the state, not the consumer as private counsel; its professional-licensing process does not itself award every civil remedy or file criminal charges. Do not use "the AG prosecutes the licensing case" as a claim that the Commission has no investigative powers.

Scenario: A consumer reports forged brokerage documents. The administrative process can determine whether the broker's license should be disciplined. A criminal court determines criminal guilt and punishment through the appropriate criminal process. An unsatisfied civil judgment may raise a separate Recovery Fund question, subject to that fund's requirements.

The Real Estate Recovery Fund

The fund is a statutory consumer remedy, not the broker's legal-expense account. IC 25-34.1-7-4 requires a qualifying final judgment for embezzlement or unlawfully obtaining money or property through the listed dishonest means. The loss must be actual cash loss, not merely loss in market value. The transaction must have required a real estate license, occurred while the person was licensed, and occurred after December 31, 1987.

After appeals and collection proceedings end, an aggrieved person may apply to the Commission for the unpaid actual direct loss. The limits are $20,000 per judgment and $50,000 aggregate lifetime for one licensee. Court costs may qualify; attorney fees and punitive damages do not. "Per judgment" must not be silently changed to "per transaction."

The fund's financing is governed by the conditional surcharge provisions in IC 25-34.1-7-2, not a promise that every ordinary fee includes a fixed Recovery Fund charge. It is also separate from the investigative-fund component in the ordinary broker fee rule.

Under IC 25-34.1-7-10, a required payment triggers suspension of the judgment debtor's license and the designated individual broker's license as specified by the statute. Re-licensing requires repayment of the amount paid with 12% annual interest. Repayment is a prerequisite, not an automatic order restoring a license.

For current licensing and contact instructions, use PLA's Real Estate Home and pla5@pla.in.gov. The official 2026 Title 25 supplies the cited statutory text; this section explains those provisions rather than certifying every rule in the title.