Client Relations & Ethics Flashcards

What is a key principle in maintaining ethical client relations as a business broker?

Answer: Being honest and transparent with clients

Acting with honesty and transparency builds trust and maintains professional integrity.

Which action is essential for building a long-term relationship with clients?

Answer: Maintaining consistent communication

Regular and clear communication fosters trust and professionalism throughout the process.

What is the broker’s duty when a potential conflict of interest arises?

Answer: Disclose the conflict to all parties

Brokers must disclose any conflicts of interest to ensure transparency and fairness in the transaction.

What is the ethical approach to representing both buyer and seller in a transaction?

Answer: Disclose dual agency and obtain consent

Dual agency must be disclosed and agreed to by both parties to avoid a breach of fiduciary duty.

Which behavior best reflects a broker's fiduciary responsibility?

Answer: Putting the client’s interest first

Acting in the best interest of the client is the core of fiduciary duty.

What should a broker do if a client asks them to hide negative financials?

Answer: Comply with full disclosure laws

Misrepresentation is unethical and potentially illegal. Brokers must present accurate financial information.