Chap. 365.—An ACT to amend the Code of Virginia by adding to chapter 169
thereof, a new section numbered 4257-d, prohibiting officers and directors of
insurance companies from being pecuniarily interested in certain transactions.

[S B 208]
Approved March 29, 1934

1. Be it enacted by the General Assembly of Virginia, That the
Code of Virginia be amended by adding to chapter one hundred and
sixty-nine thereof, a new section numbered forty-two hundred and
fifty-seven-d, which new section shall read as follows:

Section 4257-d. Officers and directors not to be pecuniarily inter-
ested in transactions except as herein provided.—No director or officer
of any insurance corporation doing business in this State shall receive
any money or valuable thing for negotiating, procuring, recommend-
ing or aiding in, any purchase by or sale to, or purchase from or sale
by, such corporation of any property, or any loan from such corpora-
tion, nor be pecuniarily interested either as principal, co-principal,
agent, or beneficiary, in any such purchase, sale or loan, nor shall the
financial obligation of any such director or officer be guaranteed by
such corporation in any capacity; and, provided, that nothing herein
contained shall prevent a life insurance corporation from making a
loan upon a policy held therein by the borrower not in excess of the
net value thereof, and further provided that existing loans, in which
a director or officer is pecuniarily interested may be renewed from time
to time until June thirtieth, nineteen hundred and thirty-nine, provided
such loans have been legally and properly made, notwithstanding the
provisions of this section. Any person in this State violating any pro-
vision of this section shall be guilty of a misdemeanor, and, upon con-
viction thereof, shall be punished by a fine of not less than twenty-five
dollars nor more than five hundred dollars or by imprisonment in jail
for not more than one year, or both, and the funds of a company in-
vested in violation of the provisions of this section shall not be allowed
as admitted assets of the company.

Nothing contained in this section shall be construed as prohibiting
a director or officer of any insurance company from receiving the usual
salary, compensation or emoluments for services rendered in the ordi-
nary course of his duties as a director or officer, if such salary, com-
pensation or emoluments be authorized by vote of the board of directors
of such insurance company, nor as prohibiting the payment of a direc-
tor or officer of any insurance company who is a licensed attorney at

law of a fee or fees in connection with loans made by any such insur-
ance company if and when such fees are paid by the borrower and do
not constitute a charge against any such insurance company.