Please write in your own words and answer more specifically to the case by using accounting terminology.
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The company is obligated to shoulder any potential losses while the primary insurers process the claims. The non-disclosure and misrepresentation frauds are significant since the company likely lowers the projected claim costs or eventually fails to report the insurance losses when they occur. The company is also likely not to report all the details concerning the materials losses from those arrangements. Reporting material insurance losses to the investors is a major requirement by the SEC. Based on the reported incidences, the long-term trends in the company would affect the company stock prices (Rice, & Weber, 2012).
