Vermont § 3847 - Fraud prevention and control

§ 3847. Fraud prevention and control

• (a)(1) A person shall not commit a fraudulent life settlement act. (2) A person shall not knowingly or with reason to know interfere with the enforcement
  of the provisions of this subchapter or investigations of suspected or actual violations
  of this subchapter. (3) It shall be a violation of this subchapter for a person in the business of life settlements
  who with knowledge or who reasonably should know to permit any person convicted of
  a felony involving dishonesty or breach of trust to participate in the business of
  life settlements. (b)(1) Life settlement contracts and applications for life settlements, regardless of the
  form of transmission, shall contain the following statement or a substantially similar
  statement: “Any person who knowingly presents false information in an application for insurance
  or life settlement contract may be guilty of a crime and may be subject to fines and
  confinement in prison.” (2) The lack of a statement as required in subdivision (1) of this subsection does not
  constitute a defense in any prosecution for a fraudulent life settlement act. (c)(1) Any person engaged in the business of life settlements having knowledge or a reasonable
  suspicion that a fraudulent life settlement act is being, will be, or has been committed
  shall immediately provide to the Commissioner such information as required and in
  a manner prescribed by the Commissioner by rule or order. (2) Any other person having knowledge or a reasonable belief that a fraudulent life settlement
  act is being, will be, or has been committed may provide to the Commissioner such
  information required and in a manner prescribed by the Commissioner by order or rule. (d)(1) No civil liability shall be imposed on and no cause of action shall arise from a person’s
  furnishing information concerning suspected, anticipated, or completed fraudulent
  life settlement acts or suspected or completed fraudulent insurance acts if the information
  is provided to or received from: (A) the Commissioner or the Commissioner’s employees, agents, or representatives; (B) federal, State, or local law enforcement or regulatory officials or their employees,
  agents, or representatives; (C) a person involved in the prevention and detection of fraudulent viatical settlement
  acts or that person’s agents, employees, or representatives; (D) the National Association of Insurance Commissioners, the Financial Industry Regulatory
  Authority (FINRA), the North American Securities Administrators Association (NASAA),
  or their employees, agents, or representatives, or another regulatory body overseeing
  life insurance, life settlements, or securities or investment fraud; or (E) the life insurer that issued the life insurance policy covering the life of the insured. (2) Subdivision (1) of this subsection shall not apply to statements made with actual
  malice. In an action brought against a person for filing a report or furnishing other
  information concerning a fraudulent life settlement act, the party bringing the action
  shall plead specifically any allegation that subdivision (1) of this subsection does
  not apply because the person filing the report or furnishing the information did so
  with actual malice. (3) A person furnishing information as identified in subdivision (1) of this subsection
  shall be entitled to an award of attorney’s fees and costs if he or she is the prevailing
  party in a civil cause of action for libel, slander, or any other relevant tort arising
  out of activities in carrying out the provisions of this subchapter and if the party
  bringing the action was not substantially justified in doing so. For the purposes
  of this section, a proceeding is “substantially justified” if it had a reasonable
  basis in law or fact at the time that it was initiated. However, such an award does
  not apply to any person furnishing information concerning his or her own fraudulent
  life settlement acts. (4) This section does not abrogate or modify common law or statutory privileges or immunities
  enjoyed by a person described in subdivision (1) of this subsection. (5) Confidentiality. (A) The documents and evidence provided pursuant to this subsection or obtained by the
  Commissioner in an investigation of suspected or actual fraudulent life settlement
  acts shall be privileged and confidential and shall not be a public record and shall
  not be subject to discovery or subpoena in any private civil action. (B) Subdivision (A) of this subdivision does not prohibit release by the Commissioner
  of documents and evidence obtained in an investigation of suspected or actual fraudulent
  life settlement acts: