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When Is an Attorney Liable for Fraud Committed by Client?

published October 23, 2012

By CEO and Founder - BCG Attorney Search left
( 177 votes, average: 5 out of 5)
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The case of former Mayer Brown partner Joseph Collins unfolding in USA v. Collins, U.S. District Court for the Southern District of New York, No. 07-cr-1170 is of great importance to attorneys. This is one of those rare instances where a corporate attorney has been held liable for legal work done in connection with a client's fraud. It is curious, but true, so there is something to be learnt from following the case, as these cases seem to be increasing in numbers and in-house counsels, as well as outside counsels, are being targeted by law enforcement. Such cases also call to question the limits of attorney-client privilege.
 
Is an attorney liable for fraud committed by client?

Last year, the charges against a lawyer accused of hindering an investigation into the marketing practices of GlaxoSmithKline was dismissed by a federal judge in Maryland. In the instant case, Collins, who was an external legal consultant for Refco is charged with helping the executives of the company conceal a $2.4 billion fraud.

To begin with, Collins has always maintained that his actions were part of a good-faith legal representation of his client, commodities broker Refco, and he was not involved in any conspiracy to commit fraud. Collins was convicted in 2009 and sentenced to a seven-year prison term. Subsequently, an appeals court dismissed the verdict earlier this year, and he is back before the U.S. District Court in Manhattan for a retrial of the matter.

Alternative Summary

Harrison is the founder of BCG Attorney Search and several companies in the legal employment space that collectively gets thousands of attorneys jobs each year. Harrison’s writings about attorney careers and placement attract millions of reads each year. Harrison is widely considered the most successful recruiter in the United States and personally places multiple attorneys most weeks. His articles on legal search and placement are read by attorneys, law students and others millions of times per year.

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