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State RegulationsNC specificDifficulty 2/5

An insurer's treasurer willfully makes a false statement in a report the company is required to file under oath with the Commissioner of Insurance. In addition to criminal liability for the treasurer, what may the court impose on the company itself?

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

Why B 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 commits a Class I felony as an individual. When the violator is an entity such as an insurer, the court is authorized to fine the entity not less than $2,000 nor more than $10,000. The cease-and-desist and general civil penalty tiers are separate provisions with different triggers and must not be substituted for this court-imposed entity fine.

Why the other options are wrong

  • A: $1,000 to $5,000 per violation is the sanction for willfully violating a cease-and-desist order under G.S. 58-63-50 — not the court fine for false sworn statements.
  • C: $100 to $1,000 per violation is the Commissioner's general civil penalty under G.S. 58-2-70(d); the false sworn statement trigger brings the G.S. 58-2-180 entity fine instead.
  • D: G.S. 58-2-180 provides for a court-imposed fine on the entity; automatic license revocation without any fine is not the statutory consequence described for this conduct.

Memory hook

False sworn filing: person = felony, company = $2,000-$10,000 court fine.

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