It can. An arrest by itself does not trigger the reporting rule, but a licensee must notify the Department of Real Estate in writing within 30 days of a filed felony charge or any misdemeanor or felony conviction, including a no contest plea. The DRE can then discipline the license if the conviction is a felony or substantially related to real estate work, and renewal forms ask again.

What you must report to the DRE, and when

Business and Professions Code 10186.2 lists three events a licensee must report: "The bringing of a criminal complaint, information, or indictment charging a felony against the licensee"; a conviction of any felony or misdemeanor, "including any verdict of guilty, or plea of guilty or no contest"; and disciplinary action by another licensing authority. The report must be made "in writing within 30 days," and the DRE's form for it is RE 238. The statute adds that "Failure to make a report required by this section shall constitute a cause for discipline," so a missed report can create a second problem even when the criminal case itself is minor.

Two things follow from that wording. An arrest that never leads to a filed felony charge, and a misdemeanor charge that has not ended in a conviction, do not trigger the 30-day rule. And a plea is enough: RE 238 explains that "convicted" includes a no contest plea and a forfeiture of bail. If you already hold a restricted license from earlier discipline, read its conditions, because the DRE's standard terms for criminal conviction cases require reporting any arrest in writing within 72 hours.

What the renewal application asks

The renewal applications for salespersons (RE 209) and brokers (RE 208) ask two criminal history questions: whether you have been convicted of a misdemeanor or felony within the six years before you file, and whether criminal charges are pending against you, or you are awaiting judgment and sentencing after a plea or verdict, when you file. So a pending misdemeanor charge that did not need a 30-day report still has to be disclosed if it is pending when you renew.

The forms define "convicted" broadly. It includes a guilty or no contest plea and a bail forfeiture, and convictions expunged under Penal Code 1203.4, 1203.4a or 1203.41 "must still be disclosed," with proof of the expungement attached. The forms list narrow exceptions you do not disclose: juvenile court adjudications, convictions sealed under Penal Code 1203.45 or Welfare and Institutions Code 781, and certain marijuana convictions under Health and Safety Code 11357 or 11360 once two years have passed.

The renewal is signed under penalty of perjury, and its certification states that the DRE "may delay my renewal and toll the expiration date" of the license under section 10177. The rules for a first application are different and narrower; see whether you can get a California real estate license with a felony.

When the DRE can discipline a license over a crime

Under Business and Professions Code 10177, the Real Estate Commissioner can suspend or revoke a license, or "delay the renewal" of one, when the licensee has pleaded guilty or no contest to, or been convicted of, "a felony, or a crime substantially related to the qualifications, functions, or duties of a real estate licensee." That ground applies once the time for appeal has passed or the conviction is affirmed, and it applies "irrespective of" probation or a later Penal Code 1203.4 dismissal. Section 10177(b)(2) adds that the commissioner may suspend the license as soon as a guilty plea is entered, because sentencing can be months away, and the suspension must be rescinded if the plea is withdrawn. Business and Professions Code 490 gives licensing boards similar authority for substantially related convictions.

Whether a crime is "substantially related" is decided under the DRE's regulation, California Code of Regulations, title 10, section 2910. Its listed characteristics include fraudulently taking or keeping someone else's money or property; forgery, altering an instrument or making a false statement; willful tax evasion; bribery, fraud, deceit or misrepresentation; sexual conduct involving a non-consenting participant or observer, or a conviction requiring sex offender registration; willful violations of the Real Estate Law; doing business without a required license or permit; unlawful acts for financial gain or meant to cause substantial injury; contempt of court or willfully disobeying a court order; a pattern of willful disregard of law; and two or more alcohol or drug convictions when at least one involves driving. The DRE also weighs the offense's nature and gravity, the time since it happened and the duties of a licensee.

A single DUI conviction does not fit that alcohol item by itself, although the facts of a case can still matter under another one; see DUI and professional licenses. A conviction is also not the only route to discipline: section 10177(j) separately covers conduct that "constitutes fraud or dishonest dealing," which does not depend on a criminal conviction.

How the DRE discipline process works

Before suspending or revoking a license, the DRE must follow the Administrative Procedure Act under Business and Professions Code 10100. The process starts with a written accusation. Under Government Code 11506, the licensee has 15 days after service to file a notice of defense; filing one brings a right to a hearing on the merits, and failing to file "shall constitute a waiver of respondent's right to a hearing," although the agency may still grant one. Accusations, suspensions and revocations also appear in the DRE's public online license information under section 10083.2.

The DRE's standard decision language in 10 CCR 2930 sets out the outcomes it uses. A license can be suspended, sometimes with part of the suspension stayed; revoked outright; or revoked with a right to a restricted license if the licensee applies and pays the fee within 90 days. That restricted license can be suspended before any hearing if the licensee is convicted of, or pleads no contest to, a substantially related crime; the licensee cannot apply for an unrestricted license or ask to remove the restrictions until two years have passed; and in criminal conviction cases it carries the 72-hour arrest reporting condition. Under section 10156.6, a restricted salesperson license can also be limited to employment by a particular broker.

What the DRE looks at for rehabilitation

When an accusation is based on a crime, 10 CCR 2912 lists the rehabilitation criteria the DRE considers. Its starting point is time: less than two years after the most recent conviction or act named in the accusation "is inadequate to demonstrate rehabilitation," and that period can be longer for more serious or repeated conduct. The other criteria include restitution to anyone who lost money, expungement of the conviction, successful completion of or early discharge from probation or parole, at least two years of abstinence when alcohol or drugs played a part, payment of fines, corrected business practices, new social and business relationships, family stability, education or vocational training, community involvement, and evidence of a changed attitude.

Expungement appears on that list, but it does not prevent discipline under section 10177(b) and it does not remove the duty to disclose the conviction on renewal. See the firm's expungement overview for how that relief works.

Decisions to make while the criminal case is still open

  • Calendar the 30-day reporting deadline from the date a felony complaint, information or indictment is filed, and from the date of any conviction or plea.
  • Treat a no contest plea as a conviction for DRE reporting and renewal, and remember that a guilty plea can lead to a suspension before sentencing under section 10177(b)(2).
  • Compare the offense a proposed plea would produce with the section 2910 characteristics, since an offense involving fraud, theft, false statements or a court order fits the regulation's language more directly than many others.
  • Keep records that support the section 2912 criteria, such as proof of restitution, completed programs and probation compliance.
  • If your renewal comes due while the case is pending, answer the pending charges question accurately, since the application is signed under penalty of perjury.

For how the firm approaches the licensing side of a criminal case, see its professional license defense page.