Which statement correctly reflects Utah deception or defalcation statutes as they relate to PLMs?

• A. They regulate only civil remedies for contract disputes.
• B. They govern mortgage rate policies nationwide.
• C. They address fraudulent acts and misappropriation; PLMs must prevent and report.
• D. They apply only to advertising standards.

Answer: (C)

Utah deception or defalcation statutes focus on integrity in mortgage lending by addressing fraudulent acts and misappropriation of funds. They set expectations that Principal Lending Managers must prevent such misconduct and report any suspected or actual defalcation. This means PLMs are responsible for implementing internal controls, supervising staff, and promptly notifying the proper authorities if a violation occurs. The idea is to safeguard client funds and ensure truthful operations, rather than covering civil contract remedies, nationwide mortgage rate policy, or advertising standards.