Washington Lawyer - September/October 2020 - 53

SPEAKING OF E THICS
clients of wrongdoing, further probing of
specific facts and circumstances can often
protect both lawyer and client. Indeed, many, if
not most, clients seek lawyers' assistance in
helping them to navigate and comply with the
law. A lawyer may fairly and truthfully explain
that requiring specific information, such as
identity of principals and sources of funds, is
necessary to avoid criminal and civil liabilities
for the client, not an accusation of wrongdoing.
In April 2020, the ABA Standing Committee on
Ethics and Professional Responsibility issued
Formal Opinion 491 to address a lawyer's
obligation to inquire when faced with a client
who may be seeking to use the lawyer's
services in a transaction to commit a crime
or fraud.11 The opinion directs that where
facts known to the lawyer establish a high
probability that a client seeks to use the
lawyer's services for criminal or fraudulent
activity, the lawyer has an affirmative duty to
make further inquiry so as to avoid assisting
such activity. In such circumstances, willful
blindness or conscious avoidance of facts
amounts to actual knowledge under Model
Rule 1.2(d).12
Ethics opinions and disciplinary cases in other
jurisdictions are generally in accord.13 Some
courts have gone so far as to read a "reasonably
should have known" standard into the rule.14
ABA Opinion 491, however, determined only
that the standard of "actual knowledge" is met
by evidence of willful blindness or conscious
avoidance, not merely circumstances in which
a reasonable lawyer should have known.
With respect to D.C. Rule 1.2(e), the chasm
between lawyer as "gatekeeper" and ostrich
is wide, though it is becoming increasingly disingenuous for a lawyer to argue that knowledge of criminal or fraudulent conduct does
not include a lawyer's willful blindness when
significant red flags clearly warrant further
inquiry.
In the absence of a clear mandate,15 District
lawyers would be wise to heed the guidance
provided by ABA Formal Opinion 491, which
also analyzes a series of common and practical
hypotheticals to help the lawyer identify the
circumstances where further inquiry by a
lawyer would be required.

NOTES

1 "Anonymous, Inc." aired on CBS on January 31,
2016.
2 "Charmian Gooch says the point of Global
Witness' hidden camera investigation was not
to target or entrap lawyers for bad behavior. The
problem, she says, are lax laws and toothless
regulations that make it ridiculously easy for
criminals to launder $300 billion dollars a year
in the United States." Excerpt from the CBS
transcript of "Anonymous, Inc."
3 See generally D.C. Rule 1.2 (Scope of
Representation) (A lawyer must abide by
a client's decisions concerning the objectives
of a representation, but that duty is limited
by the substantive law and by the Rules of
Professional Conduct); D.C. Rule 1.3 (Diligence
and Zeal) (A lawyer must also represent
a client zealously and diligently but, again, only
within the bounds permitted by law and the
Rules); D.C. Rule 1.16 (Declining or Terminating
Representation) (A lawyer may not represent
a client, or must withdraw from a representation,
if the representation will result in a violation of
the law or the Rules).
4 See generally Laurel S. Terry, "U.S. Legal Profession
Efforts to Combat Money Laundering and
Terrorist Financing," 59 N.Y.L. Sch. L. Rev. 487
(2015); Kevin L. Shepherd, "The Gatekeeper
Initiative and the Risk-Based Approach to Client
Due Diligence: The Imperative for Voluntary
Good Practices Guidance for U.S. Lawyers," J.
Prof. Law (2010); Delphine Nougayrede, "AntiMoney Laundering and Lawyer Regulation: The
Response of the Professions," 43 Fordham Int'l
L.J. 321 (2019).
5 Terry, supra, at 493.
6 This guidance includes resources such as (1)
ABA Task Force on Gatekeeper Regulation
and the Profession, Voluntary Good Practices
Guidance for Lawyers to Detect and Combat
Money Laundering and Terrorist Financing (2010),
actec.org/resources/voluntary-detect-andcombat-money-laundering; (2) ABA Comm.
On Ethics & Prof'l Responsibility Formal Op.
463 (2013), americanbar.org/content/dam/aba/
administrative/professional_responsibility/
formal_opinion_463.authcheckdam.pdf; and
(3) A Lawyer's Guide to Detecting and Preventing
Money Laundering (2014), a collaborative effort of
the International Bar Association, the American
Bar Association, and the Council of Bars and
Law Societies of Europe, actec.org/assets/1/6/ALawyers-Guide-to-Detecting-and-PreventingMoney-Laundering-October-2014.pdf.
7 D.C. Rule 1.0(f) (Terminology).
8 524 A.2d. 680 (D.C. 1987).

D.C. Bar legal ethics counsel are available for
confidential inquiries on the Legal Ethics Helpline
at 202-737-4700, ext. 1010, or at ethics@dcbar.org.

9 DR 7-102(A)(7), D.C. Code of Professional
Responsibility.
10 See D.C. Rule 1.16(a)(1); see also D.C. Rule 1.2,
Comment [8].

11 ABA Comm. On Ethics & Prof'l Responsibility
Formal Op. 491 (2020), americanbar.org/
content/dam/aba/administrative/professional_
responsibility/aba-formal-opinion-491.pdf. Note
that ABA formal ethics opinions interpret the
ABA Model Rules of Professional Conduct and
are advisory in nature. To the extent a lawyer is
subject to the same or similar governing rules
where the lawyer is licensed, and no contrary
opinion within the licensing jurisdiction exists,
ABA opinions may constitute persuasive
authority in that lawyer's jurisdiction and, at
a minimum, provide practical and prudential
guidance for the ethical practice of law.
12 Id. Although not the subject of this column,
Opinion 491 also examines how other ethics
rules may require further inquiry even in
instances where Model Rule 1.2(d) does not.
("Even if information learned in the course of a
preliminary interview or during a representation
is insufficient to establish 'knowledge' under
[Model] Rule 1.2(d), other rules may require the
lawyer to inquire further in order to help the
client avoid crime or fraud, to avoid professional
misconduct, and to advance the client's
legitimate interests. These include the duties
of competence, diligence, communication, and
honesty under Rules 1.1, 1.3, 1.4, 1.13, 1.16, and
8.4.")
13 See Ind. State Bar Ass'n Comm. on Legal Ethics,
Op. 2 (2001); N.C. State Bar Ass'n, Formal Op. 7
(2003); N.Y.C. Bar Ass'n Comm. on Prof'l Ethics,
Formal Op. 2018-4 (2018); In re Bloom, 745 P.2d
61 (Cal. 1987); In re Albrecht, 42 P.3d 887, 898-99
(Or. 2002); but see Iowa Supreme Court Att'y
Disciplinary Bd. v. Ouderkirk, 845 N.W. 2d 31,
45-48 (Iowa 2014).
14 In re Dobson, 427 S.E.2d 166 (S.C. 1993); In re Siegel
471 N.Y.S. 2d 591, 592 (N.Y. App. Div. 1984); see
also Florida Bar v. Brown, 790 So.2d 1081, 1088
(Fla. 2001).
15 In In Re Hopkins, 687 A 2d. 938 (D.C. 1996),
though attorney Hopkins strongly suspected
that her client might engage in wrongdoing,
she failed to seek to withdraw from the
representation. The court determined that "she
did not know with the certainty of Austern that
her client was engaged in fraud." However,
the issue before the court in Hopkins was not
whether attorney Hopkins assisted her client in
conduct she knew to be criminal or fraudulent,
but rather whether it was obvious that her
continued representation would result in her
violation of the disciplinary rule mandating
withdrawal in such circumstances. Although
the court ultimately determined that the lawyer
engaged in conduct that seriously interfered in
the administration of justice, it did not find that
she violated the mandatory withdrawal rule.
That said, the court cautioned, "[i]n the future,
we expect . . . this case will cause attorneys to
take greater care to separate themselves from
'renegade' clients."

SEPTEMBER/OCTOBER 2020

WASHINGTON LAWYER

https://www.americanbar.org/content/dam/aba/administrative/professional_responsibility/aba-formal-opinion-491.pdf https://www.americanbar.org/content/dam/aba/administrative/professional_responsibility/aba-formal-opinion-491.pdf https://www.americanbar.org/content/dam/aba/administrative/professional_responsibility/aba-formal-opinion-491.pdf https://www.actec.org/resources/voluntary-detect-and-combat-money-laundering/ https://www.actec.org/resources/voluntary-detect-and-combat-money-laundering/ https://www.americanbar.org/content/dam/aba/administrative/professional_responsibility/formal_opinion_463.authcheckdam.pdf https://www.americanbar.org/content/dam/aba/administrative/professional_responsibility/formal_opinion_463.authcheckdam.pdf https://www.americanbar.org/content/dam/aba/administrative/professional_responsibility/formal_opinion_463.authcheckdam.pdf https://www.actec.org/assets/1/6/A-Lawyers-Guide-to-Detecting-and-Preventing-Money-Laundering-October-2014.pdf https://www.actec.org/assets/1/6/A-Lawyers-Guide-to-Detecting-and-Preventing-Money-Laundering-October-2014.pdf https://www.actec.org/assets/1/6/A-Lawyers-Guide-to-Detecting-and-Preventing-Money-Laundering-October-2014.pdf

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