The Regulation of Lawyers in Compliance

Abstract

The field of compliance has exploded in interest, attention, and growth over recent years. It has emerged as a popular career path for those trained in the law, giving rise to an influx of job opportunities for new law school graduates and seasoned attorneys alike. Additionally, compliance has tightened the essential interplay between business and law. Numerous compliance officers hold J.D. degrees and many also serve simultaneously as both an organization’s chief compliance officer and general counsel, thereby muddying the lines between the circumstances in which such services constitute the “practice of law” requiring adherence to professional rules of responsibility or non-legal work where such rules would typically not be applicable. This Article will analyze these important distinctions, as well as the lack of regulatory guidance for lawyers in the compliance function, by viewing the discussion largely through the lens of an often-unnoticed ethical rule — the American Bar Association’s Model Rule 5.7 — which requires lawyers to comply with the full range of professional conduct rules even when they are providing a non-legal “law-related service.” This Article will argue that the compliance function is a near-precise fit for this rule and will propose reform to the current regulatory model to ensure that the interests of lawyers, as well as the recipients of their services, are protected to the most fruitful extent possible in today’s compliance-driven era. While placing this examination in the context of current scholarly debate that challenges traditional “zealous advocate” models of attorney representation, this Article will claim that, without adequate and clear regulatory reform to establish guidelines for behavior, lawyers in compliance functions risk heightened personal liability due to potential ethical violations from their respective jurisdictions of admission.