Which of the following is true regarding commingling of funds?

Commingling of funds refers to the illegal practice of mixing a real estate agent's or broker's personal funds with the client's funds, such as earnest money or trust account funds. This practice is strongly prohibited in West Virginia and various other jurisdictions because it undermines the integrity of trust accounts and poses risks to clients' funds. Commingling can lead to significant ethical and legal violations, including potential loss of a real estate license for the agent involved.

The primary reason for the prohibition is to ensure that clients' funds are safeguarded and accounted for separately. This separation helps to maintain trust in real estate transactions and protects clients from any potential misappropriation of their funds.

On the other hand, options that suggest commingling is allowed, whether with written consent or for small amounts, do not adhere to the regulatory standards set for real estate transactions. Encouraging commingling for efficiency misunderstands the fundamental principles of fiduciary duty that agents and brokers owe to their clients. Maintaining clear boundaries regarding financial transactions is crucial for a secure and ethical real estate practice.