If a prospective client gave fabricated records to an agency, must the lawyer disclose the fraud, and does it matter whether the lawyer takes the case?

Plain-English summary

A lawyer met with a prospective client who had given fabricated records to an administrative agency investigating the client; the agency did not know the records were false, and the fabrication occurred without the lawyer's knowledge or involvement. The Board assumed the records were already submitted, the investigation was early, and the records misrepresented material facts. It addressed disclosure duties if the lawyer takes the case and if the lawyer declines, and withdrew Adv. Op. 1990-7.

At the initial consultation, the lawyer must explain his or her professional obligations, including that the lawyer is prohibited from assisting illegal or fraudulent conduct (Prof.Cond.R. 1.2(d)) and that, because this is an agency investigation rather than a proceeding, Prof.Cond.R. 4.1 governs and may require disclosing material facts to avoid assisting fraud (Prof.Cond.R. 3.9, cmt. [3]; 4.1(b)). The Board noted Ohio's Prof.Cond.R. 1.6(d) is a stronger fraud-prevention rule than the ABA Model Rule, requiring disclosure to comply with Rules 3.3 and 4.1.

If the lawyer takes the case, the Board treated the fraud as ongoing (Rule 4.1(b) applies to ongoing or future, not completed, fraud). Before agreeing, the lawyer must remonstrate with the client and encourage correction of the false information, and should agree only if the client is willing to do so. If the client then fails to correct it within a reasonable time, the lawyer should withdraw to avoid assisting the fraud (Prof.Cond.R. 4.1, cmt. [3]); and if withdrawal is not enough to prevent assisting the fraud, the lawyer must unilaterally disclose the material facts to the agency, which may require disaffirming a document or affirmation of the client. If the lawyer declines, Prof.Cond.R. 1.18 protects the prospective client's confidential information as it would a former client's (Prof.Cond.R. 1.9(c)); because the lawyer is not representing the client in the investigation, Rule 4.1 does not apply and the Rule 1.6(b)(3) mitigation exception does not apply (the client did not use the lawyer's services), so the lawyer must not disclose the fabrication.

In practice

The opinion holds that, under the Ohio Rules of Professional Conduct as they stood at the time, a lawyer must not agree to represent a prospective client who provided fabricated records to an administrative agency unless the client agrees to correct the materially false information (Prof.Cond.R. 1.2(d), 4.1). Per the opinion, if after taking the case the client fails to correct the information within a reasonable time, the lawyer should withdraw, and if withdrawal will not prevent assisting the fraud the lawyer must disclose the material facts to the agency (Prof.Cond.R. 4.1, 1.6(d)). The opinion concludes that a lawyer who declines the representation generally must not, and has no obligation to, report the fabrication, because the prospective client's information is protected under Prof.Cond.R. 1.18 and the lawyer did not represent the client in the investigation.

Common questions

Q: Can a lawyer take a case for someone who already gave an agency fabricated records?

A: The opinion concludes the lawyer must not agree to the representation unless the client agrees to correct the materially false information, after the lawyer remonstrates and explains his or her duties.

Q: If the client won't fix the records after the lawyer takes the case, what must the lawyer do?

A: The opinion concludes the lawyer should withdraw to avoid assisting the fraud, and if withdrawal is not enough to prevent assisting it, the lawyer must disclose the material facts to the agency (Prof.Cond.R. 4.1).

Q: If the lawyer turns the case down, must the lawyer report the fabricated records?

A: The opinion concludes no; the lawyer generally must not report it, because the prospective client's information is protected (Prof.Cond.R. 1.18) and the client did not use the lawyer's services to submit the records.

Background and rules framework

The opinion interprets Ohio Prof.Cond.R. 4.1 (truthfulness in statements to others, including the duty in 4.1(b) to disclose material facts to avoid assisting client fraud; Model Rule 4.1), Prof.Cond.R. 1.6, including Ohio's stronger 1.6(d) disclosure duty (confidentiality; Model Rule 1.6), Prof.Cond.R. 1.18 (duties to prospective clients; Model Rule 1.18), Prof.Cond.R. 3.9 and its Comment [3] (advocate in nonadjudicative proceedings; Model Rule 3.9), and Prof.Cond.R. 1.2(d) (no assisting crime or fraud; Model Rule 1.2).

Citations and references

Rules of Professional Conduct:

• Ohio Prof.Cond.R. 4.1(b) and cmts. [3]-[4] (Model Rule 4.1)
• Ohio Prof.Cond.R. 1.6(b)(3), (d) (Model Rule 1.6)
• Ohio Prof.Cond.R. 1.18(a), (b) and Prof.Cond.R. 1.9(c) (Model Rules 1.18, 1.9)
• Ohio Prof.Cond.R. 3.9, cmt. [3]; Prof.Cond.R. 1.2(d) and cmt. [13]; Prof.Cond.R. 1.4(a)(5)

Cases:

• Disciplinary Counsel v. Cicero, 134 Ohio St.3d 311, 2012-Ohio-5457, confidentiality owed to a prospective client

Other opinions cited:

• Ohio BPC Adv. Op. 1990-7: disclosure of a prospective client's fraud (withdrawn by this opinion)
• Ohio BPC Adv. Op. 2016-10: confidentiality owed to prospective clients

See also

• Ohio BPC Op. 2016-010: Duty to Preserve a Prospective Client's Confidential Information
• Ohio BPC Op. 2020-002: Preparing a Deed at a Real Estate Agent's Direction
• Ohio BPC Op. 2019-006: Delivering a Former Client's File

Source

• Landing page: https://ohioadvop.org/advisory-opinion-index/
• Original PDF: https://www.ohioadvop.org/wp-content/uploads/2020/04/2020-03-Final.pdf

Original opinion text

Reproduced from the official source for research purposes. The linked source is authoritative.

OPINION 2020-03
Issued April 3, 2020
Withdraws Adv. Op. 1990-7

        Duty of Disclosure of Prospective Client’s Fraudulent Conduct

SYLLABUS: A lawyer should not agree to represent a prospective client who has
provided fabricated records to an administrative agency, unless the client agrees to
correct the materially false information. If after the lawyer undertakes the representation
the client fails to correct the materially false information within a reasonable time, the
lawyer must withdraw from representation to avoid assisting the client in an illegal or
fraudulent act. If the client places the lawyer in a position where withdrawal is not
sufficient to avoid assisting the client in an illegal or fraudulent act, the lawyer must
disclose the material facts to the administrative agency. A lawyer who declines to
undertake the representation of a prospective client who has provided fabricated records
to an administrative agency has no obligation to, and in most circumstances must not,
notify the agency of the fabricated records.

This nonbinding advisory opinion is issued by the Ohio Board of Professional Conduct
in response to a prospective or hypothetical question regarding the application of
ethics rules applicable to Ohio judges and lawyers. The Ohio Board of Professional
Conduct is solely responsible for the content of this advisory opinion, and the advice
contained in this opinion does not reflect and should not be construed as reflecting the
opinion of the Supreme Court of Ohio. Questions regarding this advisory opinion
should be directed to the staff of the Ohio Board of Professional Conduct.
 65 SOUTH FRONT STREET, 5TH FLOOR, COLUMBUS, OH 43215-3431
Telephone: 614.387.9370 Fax: 614.387.9379
www.bpc.ohio.gov

HON. JOHN W. WISE RICHARD A. DOVE
CHAIR DIRECTOR
PATRICIA A. WISE D. ALLAN ASBURY
VICE- CHAIR SENIOR COUNSEL
KRISTI R. MCANAUL
COUNSEL

                                OPINION 2020-03
                               Issued April 3, 2020
                            Withdraws Adv. Op. 1990-7

          Duty of Disclosure of Prospective Client’s Fraudulent Conduct

SYLLABUS: A lawyer should not agree to represent a prospective client who has
provided fabricated records to an administrative agency, unless the client agrees to
correct the materially false information. If after the lawyer undertakes the representation
the client fails to correct the materially false information within a reasonable time, the
lawyer must withdraw from representation to avoid assisting the client in an illegal or
fraudulent act. If the client places the lawyer in a position where withdrawal is not
sufficient to avoid assisting the client in an illegal or fraudulent act, the lawyer must
disclose the material facts to the administrative agency. A lawyer who declines to
undertake the representation of a prospective client who has provided fabricated records
to an administrative agency has no obligation to, and in most circumstances must not,
notify the agency of the fabricated records.

QUESTIONS PRESENTED: The requesting lawyer has met with a prospective client
who previously offered fabricated records to an administrative agency investigating the
client. The administrative agency is unaware that the records are fabricated. The
fabrication was completed without the lawyer’s knowledge or participation

   1). If the lawyer agrees to the representation, does the lawyer have an obligation

to reveal the existence of the fraudulent records to the administrative agency?

   2). If the lawyer declines the representation, does the lawyer have an obligation

to reveal the fraudulent records to the administrative agency?
Op. 2020-03 2

APPLICABLE RULES: Prof.Cond.R 1.6, 1.18, 3.9, 4.1

OPINION: The questions posed do not indicate whether the prospective client has
already provided the fabricated records to the administrative agency or has simply
proposed to offer the records. Likewise, the questions do not provide details as to what
type of records were provided and whether the records contain material information.
Nor do the questions provide any information about the timing of the prospective client’s
initial consultation with the lawyer, such as whether the prospective client is seeking
advice at the onset of the administrative agency investigation or at its completion. For
the purposes of this opinion, the Board assumes the prospective client provided the
records to the administrative agency prior to the initial consultation with the lawyer, that
the investigation is in its early stages, and that the fraudulent records contain information
that either misrepresents or falsifies material facts.

Duties Upon Initial Consultation

   During the initial consultation, the lawyer must discuss with the prospective client

the lawyer’s professional obligations and the limitations on his or her conduct due to the
Ohio Rules of Professional Conduct. See Prof.Cond.R. 1.2(d) cmt.[13] & 1.4(a)(5). The
lawyer must explain to the prospective client that while representing the client in the
course of the investigation he or she is ethically prohibited from assisting the client in
illegal or fraudulent conduct. Prof.Cond.R. 1.2(d). When a lawyer represents a client in
connection with an investigation of the client’s affairs by an administrative agency, rather
than a proceeding before an administrative agency, Prof.Cond.R. 4.1 dictates the lawyer’s
conduct in interactions with the agency. See Prof.Cond.R. 3.9 cmt. 3.
As such, the lawyer must explain to his or her prospective client that he or she will be
required to disclose material facts, to the extent reasonably necessary, in order to avoid
assisting the client in illegal or fraudulent conduct. Prof.Cond.R. 4.1(b). Because most
people are familiar with the concept of confidentiality and the attorney-client privilege
restrictions placed on attorneys, the prospective client will likely question how the lawyer
could be required to disclose material facts and information about the representation.
The lawyer must reiterate his or her obligations under Prof.Cond.R. 4.1 and explain to
the prospective client that the specific rule governing disclosure of information,
Prof.Cond.R. 1.6, specifically addresses the lawyer’s duty to disclose material facts to the
Op. 2020-03 3

extent reasonably necessary to avoid assisting in illegal or fraudulent conduct of the
client.1 Prof.Cond.R. 1.6(d) & 4.1(b), cmt. [3].

Duties Upon Agreeing to Representation

     The Board observes that Prof.Cond.R. 4.1(b) applies only to ongoing or future

fraudulent acts and does not apply to completed fraudulent acts. Prof.Cond.R. 4.1,
cmt.[4]. In this particular instance, the prospective client’s fraudulent conduct is ongoing.
It is reasonable for the lawyer to assume that because the investigation is in the early
stages, the prospective client intended for the administrative agency to review and rely
on the fraudulent documents throughout the investigation. Prior to agreeing to the
representation, the lawyer must remonstrate with the prospective client and encourage
the client to correct the materially false information provided to the agency. The lawyer
should only agree to the representation if the prospective client is willing to do so. If after
agreeing to the representation and upon a commitment from the client that he or she will
correct the materially false information provided to the agency, the client fails to do so
within a reasonable time, the lawyer should withdraw from representation to avoid
assisting an illegal or fraudulent act by the client. See Prof.Cond.R. 4.1, cmt. [3]. If the
client puts the lawyer in a position that withdrawal is not sufficient to prevent the
assistance of the client’s illegal or fraudulent act, the lawyer must unilaterally disclose
the material facts to the administrative agency. Id. The lawyer should remain mindful
that disclosure may require disaffirming an opinion, document, or affirmation of the
client. Id. The client should be placed on notice that this type of disclosure could occur
in the course of representation due to the lawyer’s thorough warning and explanation to
the client of his or her duties under the Rules.

Duties Upon Declining Representation

     A prospective client is any person who consults with a lawyer about the possibility

of forming a client-lawyer relationship. Prof.Cond.R. 1.18(a). Even if a client-lawyer
relationship does not form after consultation, a lawyer may not use or reveal information
learned in the consultation except as permitted by Rule 1.9(c). Prof.Cond.R. 1.18(b). The
effect is that the lawyer consulted must treat the prospective client’s confidential
information in the same manner he or she treats confidential information of former

1
The Ohio Rules of Professional Conduct includes Prof.Cond.R. 1.6(d) that specifically requires lawyers to reveal
information in order to comply with Prof.Cond.R. 3.3 and 4.1. This rule is a stronger fraud-prevention rule not present
in the A.B.A. Model Rules of Professional Conduct.
Op. 2020-03 4

clients. Thus, information may only be used or revealed as the rules would permit or
require or when the information has become generally known. Prof.Cond.R. 1.9(c)(1) and
(2). Both the Supreme Court of Ohio and this Board have previously indicated that a
lawyer owes a prospective client a reasonable expectation of confidentiality, and
therefore, must not reveal confidential information disclosed to the lawyer by a
prospective client. Disciplinary Counsel v. Cicero, 134 Ohio St.3d 311, 2012-Ohio-5457; Adv.
Op. 2016-10.

   If the lawyer declines representation of the prospective client there is no

requirement under the Ohio Rules of Professional Conduct that the lawyer reveal the
client’s fraudulent act in providing fabricated records to the administrative agency.
Because the lawyer is not representing the client in connection with the investigation of
the administrative agency, any disclosure required pursuant to Prof.Cond.R. 4.1 does not
apply. Further, the permissive guidelines for mitigation of a substantial injury due to a
client’s commission of a fraudulent act under Prof.Cond.R. 1.6(b)(3) do not apply because
the prospective client did not use the lawyer’s services to provide the fabricated records
to the administrative agency. Consequently, the lawyer must not disclose the prospective
client’s fraudulent acts to the administrative agency.

CONCLUSION: When a prospective client consults with a lawyer about undertaking
representation of the client, after the client has already provided fabricated documents to
an administrative agency, the lawyer must describe his or her professional duties and
obligations to the client. A lawyer must inform a prospective client that he or she is
prohibited from assisting the client in any illegal or fraudulent conduct and, in some
circumstances, may even be required to reveal confidential information to the extent
necessary to avoid assisting the client. A lawyer must not agree to represent a prospective
client who has provided fabricated records to an administrative agency unless the client
agrees to correct the materially false information. If, after the lawyer undertakes the
representation, the client has not corrected the materially false information within a
reasonable amount of time, the lawyer should withdraw from the representation.
However, if the client puts the lawyer in a position where withdrawal is not possible, the
lawyer must reveal confidential information to avoid assisting the client in an illegal or
fraudulent act. If the lawyer declines representation of the prospective client there is no
requirement under the Ohio Rules of Professional Conduct that the lawyer reveal the
client’s fraudulent act in providing fabricated records to the administrative agency.