FACTS: 

An Arizona agent received a referral from someone who represented himself to be a licensed agent in the State of California.  Upon further investigation, the Arizona licensee discovered that the California referral source did not have a valid real estate license at the time of the referral.

ISSUE: 

May an Arizona broker pay a referral to the California referral source?

ANSWER:

No

DISCUSSION:

An Arizona broker may pay a referral to an out-of-state broker only if that broker is licensed in the state of their residence.  Here, because the referral source was not licensed at the time of the referral, the Arizona broker may not pay the referral fee.

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