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State RegulationsNC specificDifficulty 3/5

An officer of an insurance company willfully makes a false statement in the company's financial statement filed under oath with the North Carolina Department of Insurance. What are the consequences for the company and for the officer?

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Answer & full 3-part explanation (select an option above, or peek)

Why A is correct

Under G.S. 58-2-180, a person who willfully makes a false statement in a statement required to be made under oath or by subscription is guilty of a Class I felony. When the violator is an entity, the court fines the entity not less than $2,000 nor more than $10,000. This is the gravest of the false-statement provisions because the sworn financial statement goes to the core of solvency oversight by the Commissioner of Insurance.

Why the other options are wrong

  • B) $100 to $1,000 is the Commissioner's civil penalty range under G.S. 58-2-70(d), and a Class 1 misdemeanor is the grade for false application statements under G.S. 58-33-105; neither fits a sworn financial statement under G.S. 58-2-180.
  • C) $1,000 to $5,000 is the forfeiture for violating a cease-and-desist order under G.S. 58-63-50, not the entity fine under G.S. 58-2-180.
  • D) The entity fine is right, but the individual's offense is a Class I felony under G.S. 58-2-180, not a Class 1 misdemeanor.

Memory hook

Sworn lie = felony for you, two-to-ten grand for the company.

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State RegulationsNC specificDifficulty 2/5

An insurance company executive willfully makes a false statement in a financial statement that Chapter 58 requires to be made under oath and filed with the Commissioner. What consequence does North Carolina law attach?

Select an option to reveal the answer and the full 3-part explanation — free, no signup.

Answer & full 3-part explanation (select an option above, or peek)

Why A is correct

Under G.S. 58-2-180, a willful false statement in a required statement under oath or subscription is a Class I felony for the individual who makes it, and the entity is fined by the court in the amount of $2,000 to $10,000. This criminal-tier consequence is far harsher than routine administrative penalties, reflecting the seriousness of lying on filings the Commissioner relies on for solvency oversight.

Why the other options are wrong

  • B) The $100 to $1,000 civil penalty under G.S. 58-2-70(d) is the Commissioner's administrative remedy; it does not describe the criminal consequence of G.S. 58-2-180.
  • C) G.S. 58-2-180 mandates a court fine on the entity of $2,000 to $10,000; probation without a fine is not the statutory outcome.
  • D) For the individual the offense is a Class I felony, not a Class 1 misdemeanor, and the entity is also fined.

Memory hook

False sworn filing: person gets the felony, entity gets the $2,000-$10,000 fine.

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