Legal Question in Real Estate Law in Illinois

I recommend contacting an attorney who is familiar with the professional regulations governing Realtors. In Illinois there is the Illinois Department of Finance and Professional Regulation that oversees professional realtors and requires registration of same. Where there is a breach of standards, complaints can be sent to the Department and a follow-up inquiry will be made concerning the actions of the realtor. There website is at: http://www.idfpr.com/Admin/Complaints.asp .

I am not sure I understand what happened here. It is not unusual for the listing broker to hold the earnest money.

Perhaps you can repost your question with more detail about your concerns. In most transactions, the listing agent (the sellers' agent) holds the earnest money. So, at first glance there does not appear to be an issue. The contract should have a provision stating how the earnest money is to be handled, along the lines that it is held in trust for the benefit of the parties, will be applied to the purchase price and what should happen in the event the deal does not close. Are you stating that it was fraud for your agent to give the money to the other agent or are you saying the listing realtor turned out to be a fraud, engaging in some type of scam? Your concern is not at all clear. If the listing agent acted inappropriately, perhaps your complaint should be directed against that agent, by contacting the state (if the agent is even licensed) or the police. I am not sure that your agent will be found to have been negligent unless there are more facts to support that this should have been seen.