MARYLAND STATE BAR ASSOCIATION, INC.
COMMITTEE ON ETHICS
ETHICS DOCKET NO. 1995-21
Confidentiality: Duty of attorney to take corrective action
Your letter of inquiry indicates that one of your clients wishes to return the proceeds of a fraudulent claim, while maintaining anonymity and avoiding criminal prosecution.
You propose to return the money to the insurance company on behalf of your client, without disclosing the client's name, or the reason that your client has insisted upon confidentiality.
You desire our opinion as to the ethics of your proposed course of action, and ask whether you might ever be compelled to disclose your client's identity to the police, the insurance company, or anyone else.
The Committee on Ethics will not issue opinions on questions of law, or on issues likely to be decided by a court or other tribunal in actual or threatened litigation. The Committee cannot predict or consider the likelihood that you might ever be compelled to disclose your client's identity.
The Committee can consider and commend your proposed course of action in maintaining your client's anonymity, and returning the proceeds of the fraudulent claim. The Maryland Lawyers' Rules of Professional Conduct confirm lawyers' special responsibility for the quality of justice, and their clients' honest dealings with others. Preserving client confidences ordinarily serves the public interest because people are more likely to seek legal advice when they know their communications will be private (Maryland Rules, Preface).
Lawyers should abide by their clients' decisions concerning the objectives of representation, but not in violation of the Rules of Professional Conduct or the law (Rule 1.2{e}). This includes maintaining client confidentiality, with very few exceptions, concerning future crime or fraud (Rule 1.6{b}). Now lawyer should knowingly fail to disclose material facts to a third person when disclosure would be necessary to avoid assisting a criminal or fraudulent act by a client (Rule 4.1 {a}(2)). It is professional misconduct for a lawyer to engage in conduct involving dishonesty, fraud, deceit or misrepresentation (Rule 8.4 {c}).
Without considering possible legal constraints beyond the proper scope of this Committee, your proposed course of action would seem not to advance, but rather partially to remedy the crime or fraud of your client in compliance with Rules 4.1{a}(2) and 8.4 {c} of the Maryland Rules of Professional Conduct. We assume, of course, that your services were not used to assert the original fraudulent insurance claim.