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Panama Papers, Lawyers’ Professional Ethics and Due Diligence Obligations

  • March 9, 2017
In April 2016, a New York Times article posited this question: “Has the legal profession lost its moral compass?” Did the Times ask the right question? Are moral and professional obligations the same? Should they be? What is or should be the role of lawyers in detecting and reporting financial crime, particularly money laundering? This program will explore rules-based, ethical, and moral obligations of lawyers to detect and report illicit financial activity by clients. Among other topics, we will explore ABA Model Rule of Professional Conduct 1.2(d), which provides that a lawyer should “not counsel a client to engage, or assist a client in conduct that the lawyer knows is criminal or fraudulent.” In addition, we will examine whether and to what extent American lawyers, like covered financial institutions and some of their European lawyer counterparts, should be obligated to “know their clients” and report suspicious transactions, including from the perspective of the Financial Action Task Force (FATF), which recently recommended that the United States apply to lawyers, on a priority basis, “appropriate anti-money laundering/counter-terrorism financing obligations.”
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