A Tucson man whose real estate license was revoked last year has filed a lawsuit against the Arizona Department of Real Estate contesting the punishment.
After a 2014 real estate department audit, Jeremy Silverman was found to have committed multiple property management violations.
In October, the department upheld an order to revoke his license and that of his business, Transaction Realty LLC, and assessed a civil penalty of $6,000.
Earlier, an administrative law judge had disagreed with the department’s conclusions and argued that, since no consumers were harmed by Silverman’s actions, the department’s penalties were too stiff. But the real estate department upheld the order, stating, “While Mr. Silverman may have had good intentions in his activities, he has admitted failing to uphold the rules and statues that govern his chosen profession.”
Silverman sued in a Maricopa County appeals court, seeking to stay the department’s order and have his license reinstated during the hearing process. Reached by phone, he declined to comment on the lawsuit until after the appeal hearing.
The Arizona Department of Real Estate, which has been cracking down on property management violations, found that Silverman had committed numerous violations, including:
- Commingling client funds — required to be kept in a trust account — with funds in his business operating account.
- Failure to retain records and maintain a positive balance in the trust account, indicating a failure to supervise the company’s property management activities.
The real estate department does not comment on pending litigation, said Louis Dettorre, assistant commissioner of operations and legislative affairs for the department.
In his September defense before an administrative law judge, Silverman said the trust account deficit occurred when a client’s checks totaling $10,000 bounced. When he realized the problem, he used funds in his operating account to pay his property management clients money owed. He also said he’d never had a complaint about his real estate activities until the 2014 audit, and that he was no longer practicing property management.
The judge agreed that Silverman’s company’s license should be revoked, but argued Silverman’s should remain intact. She recommended the $6,000 civil penalty, three years of probation and that Silverman not engage in property management.
“There is no evidence that any member of the public was harmed in this matter. Mr. Silverman credibly testified to his remorse,” the judge wrote in a September order. “The department did not establish that Mr. Silverman cannot be regulated or that it is necessary to revoke (his license) at this time to protect the public.”
But the Arizona Department of Real Estate upheld its order in October, stating, “Mr. Silverman admittedly violated numerous statutes and rules that he is required to uphold as part of the real estate profession.
“Whether Mr. Silverman exhibits remorse for his violations, the public has a right to expect that someone licensed by the state to practice real estate will practice in accordance with all of the applicable statutes and rules.”
