State RegulationsNC specificDifficulty 2/5
A person obtains money from an insurer by presenting a fabricated claim. Under which North Carolina authority is this insurance fraud prosecuted, and what determines its severity?
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Answer & full 3-part explanation (select an option above, or peek)
Why B is correct
Under G.S. 14-100, obtaining property by false pretenses is the general criminal statute under which insurance fraud is prosecuted in North Carolina; whether the offense is a felony, and at what level, depends on the amount involved. Administrative remedies available to the Commissioner operate alongside, but never replace, this criminal prosecution.
Why the other options are wrong
- A) A civil penalty of $100 to $1,000 does not displace criminal prosecution under G.S. 14-100; the two tracks differ in kind.
- C) Continuing education rules govern licensing compliance and have nothing to do with criminal fraud.
- D) The privacy act addresses the handling of personal information, not the prosecution of fraudulent claims.
Memory hook
Insurance fraud rides the general false-pretenses statute - G.S. 14-100.