This entry is part 10 of 12 in the series ELEVEN COMMANDMENTS
Michael Sean Quinn, Ph.D, J.D., Etc., Author

Law Office of Quinn and Quinn
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Austin, Texas 78703

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(Resumes: Here and there around the Net. Also separate Quinn Blog)
Commandment Four Was Published as a Blog on January 16, 2015


This Preface is attached to each of the parts, oppressive though that may appear.This blog  is part (1/11th) of a collection called the ELEVEN COMMANDMENTS OF LEGAL ETHICS.  There are 11 separate mini-blogs; they need not be read in any particular order.  I have tried to keep them “together,” but cyber-success is not an inevitability when I am around. An early version* of it was published a decade or so ago.  Before that very short speech versions  were used as part of a day long CLE course ordered by the Supreme Court of Texas for new lawyers.  Later for several years it was used in other CE or CLE contexts.  All of this can be found on my Resume which is linked to (attached to) my website. www.michaelseanquinn.com. There are video versions somewhere in the cyber-sphere, and if not there in the cyber-world or in e-space and/or in the so-called “real world,” for sale.  As old as it is, the collection–whether in print, in cyber-sky, on a something like a motion picture–is not really out of date, except there are not explicit references it to legal ethics and the cyber world.  At the same the obligations of the lawyers have not changed much, except now there is a new dimension to our confidentiality obligations and and out obligations to keep up to date. The “code numbers” are sometimes to the ABA Model Rules and sometimes to the Texas Rules of Professional Conduct. (*The term “version” means what it says: wordings change and ideas shift, tough the latter very little.)

Some of the Blogs will contain supplementary additions. Those added after January 1, 2015 will probably be dated, barring oversight. Readers may note that many of the cites are Texas cases.  This resulted from the history of the contents of these blogs. The most informal ones are at the end. 

Given the purposes and context in which the early versions of the essays were written, many of the legal rules explicitly numbered are from The Texas Rules that were built upon the ABA Model Rules. 

This blog, like some of the others, will contain supplementary additions.  Like the others, it will also use some abbreviations from time to time: L for lawyer, LF for law firm, C for client.

COMMANDMENT FIVE:  DON’T DO THE CRIME

A.        Legal Rules. It is absolutely amazing how many disbarments, etc., result from lawyers committing crimes.  These almost always involve financial matters–usually theft or stealing of some sort, at least roughly understood in common parlance, e.g., fraud, ponzi scheme, bribery,* and so forth–though sometimes they involve “mere” dishonesty and occasionally sexual conduct with or about children. (The way bribery crimes work against judges is, as it were, the opposite to that of “ordinary” lawyers.)

                  8.04(a)(2)        Lawyers
shall not commit serious crimes.  Lawyers
shall not commit non-serious crimes that reflect adversely on the lawyers’
honesty, trustworthiness, or fitness as a lawyer[.]

         8.04(a)(3)        Lawyers
shall not engage in “conduct involving dishonesty, fraud, deceit or
misrepresentation[.]”

                    
8.04(a)(3)        Lawyers
shall not obstruct justice.

B.        Commentary.

1.         Overbilling.  Overbilling can constitute larceny.  In re Stone, N.Y.S.2d (App. Div.
1997).  (Shockingly, the lawyer received
only one-year suspension.)

2.         Federal Securities Laws.  In United States v.  O’Hagan, 521 U.S. 462 (1997), already
discussed above, O’Hagan used insider information available to him, because he
was a partner of a law firm, to make a tidy profit through call options.  He used the proceeds of this scam  to cover up an embezzlement from his law
firm.  O’Hagan was convicted of various
state crimes.  State v.  O’Hagan, 474 N.W.2d 613 (Minn.  App. 
1991).  The state of Minnesota
disbarred him.  In re O’Hagan, 450
N.W.2d 571 (Minn.  1990).  Eventually, the federal government issued a
57-count indictment alleging 20-counts of mail fraud, 17-counts of fraudulent
trading in connection with a tender offer, and three counts of violating
federal money laundering statutes.  A
jury convicted O’Hagan on all 57-counts, and he was sentenced to 41 months in
federal prison.  See United States
v.  Grossman,
843 F.3d 78 (2nd
cir.  1988).  (Allan Dershowitz argued the appeal for
Grossman.  His conviction was affirmed.)

3.         Fraud Generally.  Because of their access to confidential
information, lawyers have extensive opportunities to commit various types of
fraud.  Such offenses are particularly
sanctionable because they directly reflect on the lawyer’s (and the
profession’s) honesty and trustworthiness. 
See In re Druck, 747 A.2d 779 (N.J. 2000)  (attorney disbarred for aiding and abetting
wire fraud).  See also In re Lurie,
747 A.2d 780 (N.J. 2000) (similar). 
Sometimes, these things are so serious that the lawyer even asks to be
disbarred.  In re Adams, 762 So.2d
617 (La. 2000) (lawyer convicted of conspiracy to commit mail fraud, wire
fraud, and money laundering).

a.         Sometimes, lawyers can use their office
to commit fraud for their own benefit. 
One lawyer filed a series of false requests for unclaimed funds held by
a county.  He “falsely represented
himself as attorney for 68 persons entitled to such funds, and forged claim
forms, retainer agreements and claimants’ endorsements on checks issued by the
county.”  In re Kuhnmuench, 609
N.W.2d 471 (Wis. 2000) (L was disbarred).

b.         Sometimes, lawyers get into trouble for
utilizing their law offices or their trust accounts in ways which are “too
close” to the criminal activities of their clients.  It is never a good idea for a lawyer
to permit a non-lawyer client to utilize his law office to pursue his business
affairs.  (Why do you suppose large law
firms have telephone booths at or near their elevator lobbies?)
54




c. Lawyers and Diverse Crimes. Sometimes L’s just do criminal things. Often they re connected to the sorts of things Ls do as Ls. For example, as these things go, a good many lawyer criminal activities have to do with securities fraud (e.g., the sale of stock they don’t own) or the sale of condo notes, where they don’t exists. Attorney Fred Todd, a New Jersey lawyer,  got a 46 month federal sentence for this at the age of 61, plus$6.53 restitution payment obligation. Someone on his team got 5 years, so one assumes that Fred helped “hang” his buddy–a buddy that obviously needed to be “hanged.” 
If a lawyer learns of an impending police raid
and discloses this fact to a former client, the lawyer may be subject to
discipline, as well as conviction for an attempted obstruction of justice.  Office of Disciplinary Counsel v. Klaas,
742 N.E.2d 612 (Ohio 2001).  Question:
What about a current client?

c.         Lying to regulators can be a kind of
criminal fraud and lead to criminal conviction against the deprivation of a law
license.  In re Bankston, 749 A.2d
739 (D.C. App. 2000), relying upon United States v. Bankston, 182
F.3d 296 (5th Cir. 1999).  (Bankston was
a lawyer and a state senator in Louisiana who was involved in extortion
activities in the video poker industry.)

d.         A conviction for violating federal
money laundering statutes will lead to discipline, even while an appeal may be
pending.  Kentucky Bar Ass’n v. Rorrer,
28 S.W.3d 308 (Ky. 2000). 

e.         In re Jarnagin, 537 S.E.2d 71
(Ga. 2000), an attorney filed a petition to surrender his license
voluntarily.  The supreme court held that
the acceptance of that petition was justified, since the lawyer had been
convicted of the felony offense prohibiting the knowing transmission of
fraudulently obtained money and foreign commerce.

4.         Lawyers as “Stingees.”  “DEA Stock Sting Nets Cash and Coke.”  “Operation Juno,” a three-year sting program
set up by Drug Enforcement Administration agents, has resulted in the seizure
of more than $10 million in cash and $72 million worth of cocaine, and
indictments against five Colombians operating in Atlanta for drug trafficking
and money laundering.

The DEA agents used a novel technique, posing
as stockbrokers–complete with official licenses from the Securities and
Exchange Commission–to lure the drug smugglers to use their brokerage as a
vehicle for laundering their cash. 
Although the agents did not actually make any stock trades, they did
launder $16.2 million to maintain the appearance of being a “legitimate”
brokerage.

                        In addition to the five
indicted in Atlanta, the nationwide operation resulted in an additional 47
arrests and seizure requests for funds in 59 accounts at 34 U.S. banks and 282
accounts at foreign banks.”  6 Business Crimes Bulletin 2 (January
2000).  A lawyer can easily be caught in
this type of mess if he is otherwise up to no good.




Of course, judges can be stung too.
5.         Domestic Bribery.  Bribery of officials leads to disbarment,
even if the conviction is only a misdemeanor. 
In re Tucker, 766 A.2d 510 (D.C. App. 2000). 

a.         Bribing police officers may lead to
discipline.  In re Elinoff, 22
P.3d. 60 (Colo. 2001).

b.         Attempting to bribe one’s own client to
drop a disciplinary action may itself lead to discipline.  In re Maxwell, 783 So.2d 1244 (La.
2001).

c.         Bribing court clerks merely to dismiss
tickets can lead to discipline.  In re
Tucker
, 766 A.2d 510 (D.C. App. 2000).

6.         Foreign Bribes.  Customary practices in some foreign companies
require businesses to pay money to public officials to facilitate business
transactions.  Such conduct is contrary
to the Foreign Corrupt Practices Act of 1977. 
The lawyer who advises a company to make such payments in conformity
with local custom could easily find himself guilty of conspiring to break this
law.

Many lawyers have a “when in Rome” attitude
about foreign transactions. This is a bad idea. 
Stuart Demming, Co-Chair of the ABA Task Force on International
Standards for Corrupt Practice, sponsored by the ABA section of International
Law and Practice, says that in his view, “the ethical obligations of U.S.
lawyers follow them wherever they go[.]” 
Everett F.  Sherman, Dean of
Tulane University School of Law in New Orleans, Louisiana agrees.  See Margaret Graham Tebo, A Treacherous
Path Ethics Rules May Seem Clear, but in the Changing World of Commerce They
Can Become Murky
, 86 ABA Journal
54,55 (February 2000).

If L helps C to lie, isn’t that very
much like L lying himself?  Isn’t
that really the underlying essence of a tort and crime conspiracy?
55

C.        Lawyer as Employer.  Lawyers may face criminal and professional
sanctions for transgressions committed in their capacity as employers.  See Iowa Sup. Ct. Bd. of Prof’l Ethics and
Conduct v. Morris
, 604 N.W.3d 653 (Ind. 2000) (attorney subjected to
criminal sanctions and indefinite suspension from bar for failure to pay
employee’s withholding taxes.  Noted the
court, “[the defendant’s] conduct not only violate[d] a criminal statute, but
involve[d] moral turpitude.  [Cites
omitted.]  It is tantamount to taking an
employee’s money.”  Id. at
655. 




D.        Assorted Supplements:
                       1. L already suspended for non payment of bar dues, forged a bankruptcy judge’s            signature on a court order. Got 16 month in federal who scow. + 3 years of supervised release (New York case- 2016). 

                        2. Fen-Phen lawyer-crook, Seth Johnston sentenced to 20 years, or so, for stealing                     from client in a whole group of F-Ph cases.  Already famous set of incidents leading to                        disbarment of famous Ohio PI lawyer. Sixth Circuit vacated sentence and sent back for re-                   sentencing. Time to be served might go up.  Real blaggard, this one. 




                54 For an
account of a lawyer convicted (what is in effect) fraud, see Janet Malcolm, The Crime of Shiela McGough (1999).  See U.S. v. McGough, 989 F.2d 496 [Table
only], 193 WL 62063 (per curiam affirmances of motions for new trial) (4th
Cir. 1993).
                55 For a
fictional treatment of a judge (and therefore a lawyer) helping a witness lie,
see Martin Clark, The Many Aspects of
Mobil Home Living
(2000).  (What
is interesting about this book is that the author is a circuit court judge in
Virginia.)

Originally posted on 01/16/2015 @ 7:37 pm

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Michael Sean Quinn, PhD, JD, CPCU, Etc

Michael Sean Quinn, PhD, JD, CPCU, Etc. (530)

One of Texas's leading insurance scholars, Michael Sean Quinn is a past chair of the Insurance Section of the State Bar of Texas and has a broad legal practice.

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