Ezel / Ethics Opinions / NYC-BAR
NYC-BAR April 20, 2015

What are a lawyer's duties when an internet scammer poses as a client and sends a fake check to the trust account?

Short answer: The opinion concludes a lawyer owes no confidentiality duty to someone whose purpose is to defraud the lawyer and may report them, but only after reasonable diligence confirms the person is not a genuine prospective client. Because such scams can drain other clients' trust funds, the lawyer must investigate intake requests and must promptly notify any clients harmed.

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This page answers the general question as of 2015. Ezel answers yours: whether it's allowed on your facts, under the current New York Rules of Professional Conduct, with citations.

Currency note: this opinion is from 2015
Subsequent statutory amendments, court decisions, or later opinions or rule amendments may have changed the analysis. Treat this page as historical context, not current legal advice. Verify current law before relying on any specific rule, deadline, or remedy mentioned here.
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About this page: The plain-English summary, reader guidance, and Q&A below were written by Ezel based on the official ethics opinion. The original opinion (linked on this page as a PDF) is the authoritative source for any reliance.
View original ethics opinion (PDF)

Plain-English summary

The committee addresses the ethical duties of a lawyer who suspects or learns he is the target of an internet-based trust-account scam, the common pattern being an out-of-jurisdiction "client" who quickly retains the lawyer on a contingent fee, sends a counterfeit check that the lawyer deposits, and then pressures the lawyer to wire the proceeds abroad before the bank discovers the check is fraudulent. The opinion catalogs the typical "red flags" and notes that an attorney has no obligation to respond to an unsolicited inquiry at all; ignoring or deleting a suspicious solicitation is permissible.

On confidentiality, the committee concludes that the duties owed to a prospective client under Rule 1.18 (including the duty to protect information learned in the consultation) do not extend to someone whose real purpose is to defraud the lawyer rather than obtain legal services. Following NYSBA Op. 923 (2012), it treats anyone who communicates seemingly to seek legal services as presumptively a prospective client entitled to confidentiality, with that presumption giving way only when the lawyer reasonably concludes, after diligent investigation, that the person was not actually seeking legal services. Until the lawyer reaches that conclusion, Rule 1.18(b) bars disclosing the person's information, including to banks or law enforcement; once the lawyer reasonably concludes there is a fraud, he may report it and supply information to investigators.

The committee then turns to duties owed to the firm's other clients. Because a counterfeit check deposited in a commingled trust account can cause the loss of other clients' funds, falling victim can put the lawyer in violation of Rule 1.15(a)'s fiduciary duty, and the loss triggers a duty to promptly notify the affected clients under Rule 1.4(a). The opinion further reads Rule 1.1 competence to include reasonable diligence in identifying and avoiding common internet scams, particularly where they can harm existing clients (citing Iowa Supreme Court Attorney Disciplinary Board v. Wright). Accordingly, a lawyer who receives an internet solicitation should conduct a reasonable investigation to verify the person is a legitimate prospective client, should not depart from customary intake procedures, and should hold deposited funds until the bank confirms the funds are actually collected rather than merely that a check has "cleared."

In practice

The opinion holds that, under the New York rules as they stood at the time, the duty of confidentiality to a purported prospective client persists until the lawyer reasonably concludes, after diligent investigation, that the person is a fraudster; only then may the lawyer report. Per the opinion, two further duties follow from a trust-account scam: a competence-based duty (Rule 1.1) to investigate internet intake requests and avoid common scams, and a duty under Rule 1.15 and Rule 1.4 to safeguard client funds and promptly notify any clients harmed by a loss from the trust account.

Common questions

Q: Can I report an internet scammer who posed as a client to the bank or police?

A: Yes, but the opinion conditions it on diligence: you may report only after a reasonable investigation leads you to conclude the person was not genuinely seeking legal services. Until then, Rule 1.18(b) treats them as a prospective client whose information you may not disclose.

Q: Do I owe confidentiality to someone who turns out to be a fraudster?

A: The opinion concludes you do not, once you reasonably determine the person's purpose was to defraud you rather than obtain legal services. The presumption of confidentiality under Rule 1.18 applies until that reasonable conclusion is reached.

Q: A counterfeit check drained funds belonging to my other clients. What must I do?

A: Per the opinion, the loss implicates your Rule 1.15(a) fiduciary duty to safeguard client funds, and Rule 1.4(a) requires you to promptly notify the harmed clients of this material development.

Q: Can falling for a scam itself be an ethics violation?

A: The opinion reads Rule 1.1 competence to include reasonable diligence in identifying and avoiding common internet scams, especially where they can harm existing clients; a lawyer who fails to exercise that diligence may violate Rule 1.1.

Background and rules framework

The opinion interprets New York Rule 1.18 (duties to prospective clients; Model Rule 1.18) and Rule 1.6 (confidentiality; Model Rule 1.6) on the confidentiality question, and Rules 1.1 (competence; Model Rule 1.1), 1.15 (safekeeping property and trust accounts; Model Rule 1.15), and 1.4 (communication; Model Rule 1.4) on the duties to existing clients. It applies the NYSBA framework treating a communicator as a presumptive prospective client absent a reasonable conclusion of fraud.

Citations and references

Rules of Professional Conduct:

  • Model Rule 1.18 / NY RPC 1.18 (duties to prospective clients)
  • Model Rule 1.6 / NY RPC 1.6 (confidentiality)
  • Model Rule 1.1 / NY RPC 1.1 (competence)
  • Model Rule 1.15 / NY RPC 1.15 (safekeeping client funds; trust accounts)
  • Model Rule 1.4 / NY RPC 1.4 (communication)

Cases:

  • Iowa Supreme Court Attorney Disciplinary Board v. Wright, 840 N.W.2d 295 (Iowa 2013), competence violation for failing to investigate a common scam
  • Lombardi, Walsh ... v. American Guarantee & Liability Insurance Co., 924 N.Y.S.2d 201 (3d Dep't 2011), trust-account fraud and insurance coverage

Other opinions cited:

  • NYSBA Ethics Op. 923 (2012): a purported prospective client seeking to defraud is not owed confidentiality
  • NYSBA Ethics Op. 833 (2009): no duty to respond to an unsolicited representation request
  • California COPRAC Ethics Alert (Jan. 2011): internet scams targeting lawyers

See also

Source

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