How to Track a Fraud Exception After Signing

How to track a fraud exception is a carve-out and definition ledger from signing through indemnity claims, not a one-word “fraud” sticker on the cap. For each signed deal, log whether fraud is carved out of the indemnity cap and the exclusive-remedy clause, whether fraud is defined (and how tightly), whether the carve-out is limited to representations in the agreement, how it sits next to non-reliance, whether fraud is also a standalone indemnity, and status of any claim that turns on the carve-out. Raziel's exclusive remedy tracking page is the claim path. This page is whether fraud can climb past the dollar ceiling and the exclusive-remedy wall.

This is not legal, tax, insurance, or investment advice. Raziel does not provide it. Copy the fraud definition and the carve-out sentences. Do not invent an 85 percent default onto a silent deal.

What this fraud-exception ledger is (and is not)

Sellers rely on caps and exclusive-remedy clauses to bound post-closing risk. Buyers usually insist that fraud sit outside those bounds. Goulston & Storrs, summarizing the ABA Business Law Section’s 2025 Private Target M&A Deal Points Study (139 publicly available agreements executed and/or closed in 2024 or Q1 2025), reports that an exclusive-remedy provision appeared in 89% of Study deals, and that a fraud carve-out was present in 85% of the agreements with that provision. Goulston also notes a trend toward defining fraud with some specificity, often limiting the carve-out to actual or intentional fraud. Wagner Hicks, summarizing the same 2025 Study, reports that only 11% of deals now leave fraud undefined (majority approach as recently as the ABA’s 2016-17 study), that 70% of agreements with a fraud carve-out expressly limit it to fraud resulting from representations in the acquisition agreement itself (up from 52% in the prior study), that 81% of deals include express non-reliance provisions, and that only about 26% of those non-reliance deals carve fraud out of non-reliance. The ABA and K&L Gates also flag a new 2025 Study data point on how often fraud appears as a stand-alone indemnity. Those are study snapshots. Your PDF controls.

The ledger is not a securities claim. It is also not a second exclusive-remedy row. Exclusive remedy is the claim path. This row is whether fraud is defined, limited to in-agreement representations, and allowed to bypass the cap and that path’s walls.

Seven columns on one fraud-exception row

Open one row per signed deal. Attach the indemnification article, the fraud definition (if any), the exclusive-remedy clause, and the non-reliance clause.

• Cap carve-out present. Whether fraud (or fraud and intentional misrepresentation) is expressly carved out of the indemnity cap. Copy the sentence. Do not treat silence as a carve-out.

• Exclusive-remedy carve-out. Goulston: fraud carve-out in 85% of exclusive-remedy deals (exclusive remedy itself in 89% of Study deals). Copy whether fraud sits outside exclusive remedy. Keep this cell next to, not inside, the exclusive-remedy row.

• Definition specificity. Wagner Hicks: only 11% of deals leave fraud undefined. Copy whether the paper defines fraud, and whether it is limited to actual or intentional fraud. Do not paste “undefined” onto a defined deal.

• In-agreement limit. Wagner Hicks: 70% of fraud carve-outs expressly limit the carve-out to fraud from representations in the acquisition agreement (up from 52%). Copy that limit. Extra-contractual statements are a different fight.

• Non-reliance overlay. Wagner Hicks: 81% of deals have express non-reliance; only about 26% of those carve fraud out of non-reliance. Copy both sentences. A tight fraud carve-out plus non-reliance without a fraud carve-out is a different book than a wide fraud carve-out that also punches through non-reliance.

• Stand-alone indemnity and RWI. The 2025 Study newly tracks fraud as a stand-alone indemnity. Copy whether fraud is its own indemnity category, and whether RWI or the binder treats fraud differently from general representation breaches. Do not invent a Study percentage for the stand-alone cell if your PDF is silent.

• Status. Copied, claim noticed that turns on fraud, carve-out applied, definition disputed, paid outside the cap, or closed. When cash moves, book the date.

Copy the definition, not the three percentages

Do not paste 85% onto a deal with no fraud carve-out. Do not paste 70% in-agreement limits onto a carve-out that reaches management presentations. Do not fold the fraud row into the indemnity-cap row or the exclusive-remedy row. The cap is how high ordinary indemnity can go. Exclusive remedy is the ordinary claim path. Fraud is whether a defined set of bad-faith statements can climb past both. Keep them separate so a demand letter’s “fraud” line is classified against the right clause.

When a claim arrives, log which sentences the buyer says were fraudulent, whether those sentences sit inside the agreement or outside it, and which definition of fraud the paper uses. A seller who negotiated a tight, in-agreement, intentional-fraud carve-out needs that trail. A buyer who wants uncapped recovery needs the same trail.

When the ledger holds

The row holds if the seven cells are copied from the PDFs (or marked missing). It fails when you invent a definition, ignore the in-agreement limit, or treat non-reliance as if it erased a fraud carve-out that is still written in the indemnity article. Raziel's alternative asset dashboard is where the definition, the claim notice, and any cash should sit together. Raziel does not litigate your fraud theory. Copy the seven columns.