Under 18 USC Section 1033, a person convicted of a felony involving dishonesty or breach of trust:
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Answer & full 3-part explanation (select an option above, or peek)
Why A is correct
18 USC Section 1033 makes it a federal crime for a person convicted of a felony involving dishonesty or breach of trust to engage in the business of insurance affecting interstate commerce without the written consent of an insurance regulatory official. The prohibition is on participating in the insurance business — such as serving as an agent, broker, or officer — not on being a policyholder. A state license alone does not override the federal bar; the offender must obtain regulatory consent to participate in the industry. Section 1034, in turn, provides civil penalties and injunctions for violations of Section 1033, reinforcing the federal gate over who may work in the insurance business.
Why the other options are wrong
- B) Section 1033 restricts engaging in the insurance business, such as acting as an agent or officer; it does not bar convicted felons from buying insurance as consumers. Purchasing coverage as a consumer does not involve the responsibilities or access of the insurance business, so it is not restricted.
- C) Holding a state license does not cure the federal prohibition; the statute requires written consent of a regulatory official before a convicted felon may work in the insurance business.
- D) The restriction applies to the business of insurance generally, covering all product lines, not just to a single line such as annuities. The ban reaches every aspect of the insurance business in interstate commerce, including life, health, property, casualty, and annuities alike.
Memory hook
Federal gate: convicted of dishonesty? You need official consent to work in insurance.