The inquirer represents a lawyer who was informed by Philadelphia detectives that he or she tendered several counterfeit bills, along with numerous legitimate bills in return for travelers checks.
The lawyer received all of the bills used to purchase the travelers checks from clients who paid in cash. The lawyer's fee ledgers reflect the names of the clients from whom the cash was received. The lawyer anticipates that he or she will be contacted by federal agents who will inquire into the source of the bills. The lawyer requests this committee's guidance on the proper way to respond to such an inquiry.
The inquiry raises the question of whether the lawyer's records concerning the identities of clients who paid cash fees before the cash was used to purchase travelers checks may (or must) be disclosed to the federal authorities, if they ask for such information.
Rule 1.6(a) provides:
A lawyer shall not reveal information relating to representation of a client unless the client consents after consultation, except for disclosures that are impliedly authorized in order to carry out the representation, and except as stated in paragraphs (b) and (c).
The only potentially relevant exceptions found in 1.6(b) or (c) are as follows:
(c) A lawyer may reveal such information to the extent that the lawyer reasonably believes necessary:
(1) to prevent the client from committing a criminal act that the lawyer believes is likely to result in death or substantial bodily harm or substantial injury to the financial interests or property of another;
(2) to prevent or to rectify the consequences of a client's criminal or fraudulent act in the commission of which the lawyer's services are being or had been used.
The threshold question which must be answered is whether the records of clients who paid fees is information relating to the representation of a client. In Philadelphia Bar Association Professional Guidance Opinion 91-31, this Committee concluded that the identity of a client was information relating to the representation of a client, and was subject to the confidentiality requirements of Rule 1.6.1
Since the identities of the clients are confidential under Rule 1.6, disclosure is only permitted if there is an exception to that rule.
The exception permitting disclosure found in Rule 1.6(c)(1) does not apply because the lawyer does not know if the crime, in this case, the passing of counterfeit bills, is continuing. Furthermore, the lawyer does not know which of the clients paid with counterfeit bills. Finally, the lawyer does not know if the client who paid with counterfeit bills did so knowingly or innocently. Since the lawyer has no information to believe that a continuing crime may be prevented, Rule 1.6(c)(1) does not permit disclosure.
Similarly, Rule 1.6(c)(2) does not permit disclosure because the payment of a fee is not a criminal or fraudulent act in the commission of which the lawyer's services had been used. Stated differently, the client did not use the lawyer's services to further the crime of passing counterfeit bills by passing the counterfeit bills to the lawyer. Even if a conclusion were reached that the lawyer's services were used in furthering the passing of counterfeit bills based on the reasoning that the lawyer was used to launder the counterfeit money and obfuscate the source of the money, disclosure under Rule 12.6(c)(2) would be permitted only if the lawyer knew that a particular client knowingly paid with counterfeit bills. Since the inquirer suggests that he or she does not know which of the clients provided the counterfeit bills, disclosure on this basis is not permitted.
While disclosure of one of the client's identities might have been permitted under 1.6(c)(2) if the lawyer knew that his or her services were knowingly utilized to further the crime of laundering counterfeit money by that particular client, disclosure of all of the clients' identities is not permitted under either of the exceptions listed above. However, if the lawyer obtained consent from all of the clients after consultation, then pursuant to the reasoning in Philadelphia Bar Association Professional Guidance Opinion 91-31 would be permitted.
Under the facts provided by the inquirer, the inquirer must not disclose the identity of the clients who paid cash fees. Only if all clients who paid cash consent after consultation, may disclosure of all of their identities be made.
The committee notes, however, that the comment to Rule 1.6 provides in part that, The lawyer must comply with the final orders of a court or other tribunal of competent jurisdiction requiring the lawyer to give information about the client.
Should you receive a subpoena to produce the information, you must file for a protective order, but should that order be denied, and the court orders you to disclose the information, ethically you may do so only at that point, or if you choose be cited for contempt by the court.
1. The inquiry which led to Professional Guidance Opinion 91-31 involved a firm which wished to pledge its accounts receivable to secure an outstanding loan with a bank. In the Security, the bank required disclosure of the names and address of clients. The Committee concluded that the names and address of the clients could not be disclosed by the lawyers without consent by the clients after consultation by the lawyers.