§ 13 — Indemnification

§ 13. Indemnification. 1. The state shall save harmless and indemnify\nmembers, officers and employees of and representatives to the board, all\nof whom shall be deemed officers and employees of the state for purposes\nof section seventeen of the public officers law, against any claim,\ndemand, suit, or judgment arising by reason of any act or omission to\nact by such member, officer, employee or representative occurring in the\ndischarge of his duties and within the scope of his service on behalf of\nsuch board including any claim, demand, suit or judgment based on\nallegations that financial loss was sustained by any person in\nconnection with the acquisition, disposition or holding of securities or\nother obligations. In the event of any such claim, demand, suit or\njudgment, a member, officer or employee of or representative to the\nboard shall be saved harmless and indemnified, notwithstanding the\nlimitations of subdivision one of section seventeen of the public\nofficers law, unless such individual is found by a final judicial\ndetermination not to have acted, in good faith, for a purpose which he\nreasonably believed to be in the best interest of the board or not to\nhave had reasonable cause to believe that his conduct was lawful.\n 2. In connection with any such claim, demand, suit, or judgment, any\nmember, officer or employee of or representative to the board shall be\nentitled to representation by private counsel of his choice in any civil\njudicial proceeding whenever the attorney general determines based upon\nhis investigation and review of the facts and circumstances of the case\nthat representation by the attorney general would be inappropriate. The\nattorney general shall notify the individual in writing of such\ndetermination that the individual is entitled to be represented by\nprivate counsel. The attorney general may require, as a condition to\npayment of the fees and expenses of such representative, that\nappropriate groups of such individuals be represented by the same\ncounsel. If the individual or groups of individuals is entitled to\nrepresentation by private counsel under the provisions of this section,\nthe attorney general shall so certify to the comptroller. Reasonable\nattorneys fees and litigation expenses shall be paid by the state to\nsuch private counsel from time to time during the pendency of the civil\naction or proceeding, subject to certification that the individual is\nentitled to representation under the terms and conditions of this\nsection by the chairman of the board, upon the audit and warrant of the\ncomptroller. The provisions of this subdivision shall be in addition to\nand shall not supplant any indemnification or other benefits heretofore\nor hereafter conferred upon members, officers, or employees of and\nrepresentatives to the board by section seventeen of the public officers\nlaw, by action of the board or otherwise. The provisions of this\nsubdivision shall inure only to members, officers and employees of and\nrepresentatives to the board, shall not enlarge or diminish the rights\nof any other party, and shall not impair, limit or modify the rights and\nobligations of any insurer under any policy of insurance.\n