What happens if an agent does not disclose a dual agency?

The scenario in which an agent does not disclose a dual agency can lead to significant legal consequences for the agent. In real estate and many other agency contexts, failing to disclose a dual agency—that is, representing both the buyer and seller in the same transaction—violates ethical standards and legal obligations. Agents have a fiduciary duty to act in the best interest of their clients, which includes providing all relevant information about the agency relationships.

When an agent does not disclose dual agency, it can undermine the trust that clients place in the agent, and it could also result in financial harm to one or both parties involved in the transaction. This breach could lead to complaints, lawsuits, and disciplinary actions from regulatory bodies, including potential loss of licensing. Thus, the correct answer highlights the serious implications of not maintaining transparency in agency relationships, underscoring the importance of full disclosure in maintaining ethical standards in real estate practices.

In comparison, the other options do not accurately reflect the repercussions of failing to disclose dual agency, as they suggest positive outcomes or implications that are not aligned with the true nature of ethical and legal responsibilities in agency relationships.