Imagine having your bar licenses suspended for two years over a measly $175. Sadly, that’s what happened to this unfortunate Ohio attorney (Respondent) who accepted referrals from United Financial Systems Corporation (UFS), a national wealth management company. As described in this grievance decision by the Supreme Court of Ohio, UFS representatives used non-lawyers to meet with prospective estate planning clients. The non-lawyers would obtain personal and financial information, which they would transmit along with the the $2495 payment to UFS. At that point, UFS would assign client files to attorneys to prepare the estate documents.
In this case, the Respondent, who was barred in Ohio, handled matters for UFS clients who lived in Ohio and continued to do so after she relocated to Michigan in April 2005. She received $175 for preparing estate planning documents. In March 2006, she ended her affiliation with UFS in March 2006, after realizing that her conduct violated disciplinary rules, such as the prohibition on fee-splitting with non-lawyers, failing to safeguard confidential information and aiding in unauthorized practice of law by non-lawyers.
Still, the Respondent’s resignation did little to quell the vengeance of the Ohio Bar Association who filed a complaint against her in August 2007, more than a year after she ceased taking UFS clients. And even though the Respondent had no prior disciplinary record or dishonest or selfish motive and cooperated during the disciplinary proceedings, she was suspended from practice for two years!
Though I fault the bar entirely for the suspension, there’s much that the Respondent could have done, and which other lawyers can do, to avoid this fate. First, even though legal ethics are complex, you can’t check your common sense at the door. This kind of arrangement – where a lawyer gets a $175 piece of a $2495 fee – should have raised a red flag. Likewise, delegating collection of personal and financial information to a UFS representative rather than having the task done by the lawyer or one of her employees should have triggered questions about confidentiality.
When it comes to arrangements with non-lawyers, if you can’t definitively confirm that the arrangement passes ethical muster, then walk – no run – away. Losing $175 is a trivial price to pay to keep your license and preserve your career.