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Directors and Officers Liability: Common Crimes
Posted on: August 1, 2016 by Newmark Insurance
As the executive management of a company, directors and officers are tasked with leading the business to success. While the majority of these professionals are legitimate and hardworking, it’s impossible to predict the behavior of each and every employee. With that said, the Justice Department and the Securities and Exchange Commission (SEC) have recently identified the common violations that directors and officers face. As we take a closer look at these common crimes and their impact on the business, it’s imperative that you equip your management with a comprehensive Directors and Officers Liability insurance policy.
Bribery is working to be eliminated by the SEC and the DOJ via the U.S. Foreign Corruption Practices Act (FCPA). Any official who offer or accept bribes will be held in violation of this regulation and be faced with severe punishments.
Inside Counsel identifies these offenses as insider trading, false representations of product performance and breaches of fiduciary duty, which can also lead to investigations. This includes fraud in all its forms such as stealing money, misrepresenting financial statements, misreporting income, and more.
This issue is becoming widely recognized in the business world. From stealing confidential personal information to company trade secrets, there are numerous ways your D&O’s can violate the company policy and put your business at risk.
Treatment of foreign workers and the outsourcing of labor creates liability for directors and officers. Ensure foreign transactions are completed lawfully and that labor laws are followed rigorously when conducting work outside of the United States.
At NewMark Insurance Services, we understand the importance of protecting directors and officers. Our packages strive to provide ample protection and financial assistance against potential exposures. For more information, contact us today at (855) 777-6549.